The Mining Play

Medinah/Auryn - 2018 Q3 General Discussion


#1

Lets start the new quarter off right…


#2

Okay. This will be a quarter to remember. :wink:

Hey, a broken clock is right twice a day.

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#3

GCC,
You are so right as you reminded us before closing out the Q2 thread and beginning Q3, many don’t go back and comment on the previous quarter! Many also don’t bother to check links that would benefit a greater understanding of just where things are with the ADL.
A few days ago WIZ posted this link (along with the comment “The ADL is truly a massive greenfield mining site.”):

Back in January (2018 Q1) there were two very interesting posts, first by HR and then followed by CHG (see the full discusion):

Continuing the discussion from Cerro/Medinah/Auryn- 2018 Q1 General Discussion :sunrise_over_mountains::

Continuing the discussion from Cerro/Medinah/Auryn- 2018 Q1 General Discussion :sunrise_over_mountains::

One misses a lot if they don’t go back and reread a lot of the thoughts and discussions that other shareholders have taken time to post as this “investment” evolves. The truth is that this stock has taken far too much time for most shareholders to envision an eventual ROI. Much interest has been lost because we are not seeing results. How many here have taken a look at the incredible optimism overall in “the junior” miners as shown on the GDXJ chart beginning in 2016? There was generally enthusiasm in the entire sector. Comparatively, junior minors did not perform well during the 2017 year and interest dropped off noticably during Oct and Nov last year.

Could there be a good reason for AURYN not to proceed to start funding the exploitation of a new mine due largely to waning interest and diminishing profitability in the sector? Could a better strategy be to expend funds by expanding and acquiring adjoining claims while the sector was depressed? Is this part of AURYN’s strategy?

Has anyone been following TheRod’s many postings on “Other Mining Stocks” the past couple of years? There is a great amount of DD on the other thread. As a comparison check all the postings that the Barkerville Exploration Project has accomplished since 2016 and how it’s chart has been performing. Barkerville is only one of many examples on the other thread:

also see TheRod’s post #350 (2018 Q2) Barkerville:

Cow and Island Mountain deposits only -

1.60 M oz measured and indicated category (8.1 million tonnes grading 6.1 g/t Au)

2.16 M oz of gold in the inferred category (12.7 million tonnes grading 5.2 g/t Au)

2.16 M oz of gold in the inferred category (12.7 million tonnes grading 5.2 g/t Au)

Barkerville is only one example of a greenfield project that is so far ahead of the exploration done by AURYN on the ADL. There are many other examples presented on the Other Mining Stocks thread of greenfield projects. A better perspective could be gained by comparing progress to the many other greenfield stocks that have been followed by several posters on the other thread and how those stocks have performed, IMO.

Generally speaking, Market Cap is a very inappropriate method for determining valuation. We don’t know what we don’t know. Are we really basing a valuation on the balance sheet of a company only holding a minority interest in the underlying asset? As the WIZ recently reminded us, “The story is FAR from over.”

As much as I’d like to be optimistic about the next quarter, it may be better for shareholders to reign in their expectations of a quick recovery for CDCH/MDMN/AURYN stock prices. We do not even have a consolidated stock on the market yet. There is much work to getting our stock in shape so that it can perform well, along with AURYN announcing some great early mining results this next season or perhaps a JV. Timing in this sector is important.


#4

Generally it has not proven to be useful, but I will throw a little crazy new Q3 speculation out there:

Why the recently announced RTO of a Masglas Limited Peruvian subsidiary (Masglas Peru) with a Canadian company via the acquisition of yet another property in a new country (Peru)? What does this have to do with anything ADL?

Tonight over beer and baseball I am sort of convincing myself this has to do with these lines in the recent announcement:

The San Nicolas assets also include ownership of the 24 hectare property upon which the Cosinsa Mill sits. The Cosinsa Mill had been used in the past to process oxide mineralization from the San Nicolas Mine over the past few decades. The owners of the San Nicolas Project mined and processed surface and underground oxide gold, silver, copper, lead, and zinc mineralization from the mine, … The mine operated until January of 2016 when it closed due to technical and financial issues as the attempt was made to transition from oxide production to sulfide production. The transition would have required a new mill and the company was unable to acquire financing. [1]

Why bother making so much mention of the mill that doesn’t fit this property?

think … think … think. So Masglas has been looking for a way to go public and as recently as Dec 15, via Auryn they were saying they were planning to:

Focus “our resources on becoming an active gold producer by reopening the Fortuna gold mine and actively exploring and mining the gold veins found in the Larissa tunnel.”[2]

And one more little item, in June 2016 Auryn stated re. the Merlin veins:

Metallurgical tests conducted at laboratories in Perú returned an average gold recovery greater than 90%. Test conditions confirmed the best recovery method entails use of a Falcon gravimetric system processing previously concentrated ore.

There are various concentrator systems that are becoming quite popular these days with smaller / mid size companies. But they usually / often require a crusher / mill in front of them to make fine ore that can then be run through the concentrator. See a tiny example here: https://www.youtube.com/watch?v=TbTlgg92r0s

Finally, mills of any size are hugely expensive, costing millions or even tens of millions of dollars depending on tonnage and other capabilities. But let’s just think for a second … what if I could get a used mill? Could I save money that way? Yes you can … sometimes lots. Here is a company (Almaaden Minerals) that is buying a lightly used mill system (albeit 7000 tpd so quite a bit bigger than what is needed for the Merlin) in Alaska and transporting it to Mexico and saving $70M on their project. [4]

Hmmm … some pieces are starting to fit together here…

Masglas acquires this San Nicolas property for a song (I’m guessing) which just curiously happens to come with a mill no longer suitable for that property. Masglas does an RTO with a Canadian public company on the basis of that property and thus goes public and accesses public markets / financing as they previously suggested. And in the process they get a mill that might potentially be just right sized for the high grade ore of the ADL. Couple that with a little concentrator action and that would put them right where they said they wanted to go 2 years ago and as recently as 6 months ago.

Cash flow generated from production at the Caren Mine project will provide the funding required for the aggressive exploration program at the high-potential porphyry mineralization at the Pegaso Nero target, as well as further drilling at the Merlin-Fortuna targets [3]

I have been wrong many times in the past and will be again. But this makes sense to me from multiple angles. If there is anything to it hopefully to go along with those new claims around the ADL, Auryn has been working on permitting so there could all be in place. Mining / Mine construction season is approaching …

Just some CHG speculation …

===========

  1. https://globenewswire.com/news-release/2018/06/29/1531932/0/en/Western-Troy-Announces-RTO-with-MASGLAS-Peru-S-A-C-and-a-One-for-Five-Share-Rollback-of-its-Common-Stock.html

  2. http://aurynmining.com/auryn-sells-mining-claims-cerro-dorado-inc/

  3. http://aurynmining.com/caren-mining-preparation-commences/

  4. http://www.almadenminerals.com/NEWSROOM/2015/AlmadenNR_Oct19-15.pdf


#5

Bravo! May be thinking quite outside the box, but making a lot of sense. Have another beer and watch some more baseball! :joy:


#6

Most of the imagery on Google Earth for the ADL area has been updated to late March 2018. I took a cursory look around and did not spot any changes from the Dec. 2017 images.


#7

The date of the aerial photos changed but it appears still to be the exact same image that was previously dated December, 2017.


#8

Just wondering who in the heck would be selling at .0032 ???

I guess somebody who just can’t wait any longer.

Thanks for the opportunity, but sorry you had to sell …


#9

Could be somebody who doesn’t believe the asset is worth $70M. There are dozens/hundreds of properties out there with: better defined resource, closer to production, more reputable management with market caps under $50M. Do some of these other plays represent a potential WCD? Not all of them but nobody knows enough about our properties to assume one way or another. We’re trading at what many people see as fair value.


#10

Yet you are still here to grace us with your presence! :slight_smile:

The home run potential remains if Auryn partners up and actually does something instead of apparently just playing around. The Alto is a WCD just waiting for a competent party to come along and develop it.


#11

and waiting and waiting and more waiting. by this time if we have any coal there we will have diamonds too


#12

Hey George, go back and read Kevin’s post last week. “This will be a quarter to remember” let’s see what happens in the next 3 months


#13

Wow. A wink and a comment about a broken clock.

Please don’t think I know anything more than you do about what’s next. I just happen to know that the worst is likely behind us with LP and JJ out of the picture and that AURYN isn’t out to screw us. They are trying to develop it and we will see what the property has as things unfold.


#14

Well the hands fell off of this clock and it is not digital, so it can’t even tell time right once a day, at least that is how I feel about Auryn and MDMN. The silent is deadly and a simple courteous update would really be nice since it is way over due!


#15

Well thank you Kevin for confirming we are still in the dark.


#16

Does anyone remember seeing these photos? Looks like the entrance to the Larissa tunnel on Dante photo?

Found it


#17

No…

It is associated with their reverse merger Company I believe.


#18

Thank you mike! If you look closely MC is wearing his Auryn vest :thinking:


#19

Y. I’m here until the end of the year. The problem with the “home run” thesis is that it needs to assume that any partner in a potential JV would be willing to front all of the capex and still give us a decent piece of the pie while bringing the “WCD” into production. If our deal is anything like the last one (gave up 70% for a few million $ spent and a standstill scenario) there won’t be any crumbs left for the likes of you and me. Even if this is the ultimate home run and we end up with 25% of the assets we would still need a $4 billion valuation for CDCH to reach 10 cents. Is it more likely we get a “10 bagger” here or with any number of other junior miners with 50-100M shares outstanding, a decent resource, a high likelihood production, trading at 5-10 cents??? How many $4B market cap companies are you familiar with? How long would it take to reach this valuation in the most optimistic of timelines? (Pretium has a $1.5B valuation).

I’m not trying to be the perennial wet rag but, when people ask how anyone could possibly be selling MDMN at .003, there is a very reasonable explanation. Dare to dream but try to understand the odds while you’re at it.


#20

An AURYN vest? Really! Where can I get one? If all shareholders order one right now will it get the Larissa adit/Caren vein funded and kick-started?
Perhaps we just need a poll to get this started! :rofl:

The odds increase when one …
Thinks Big, & Dreams Bigger!

There is no quick fix, but solutions are better than a new litany of boring complaints. :eyeglasses: