Merry Christmas & Buon Natale!
What I like from the Cdch update last week is that CDCH said “they will post the complete contract with a detailed list of the properties as soon as practical” hopefully this will come out soon so we can get more info
Is anyone hoping that Santa will leave them a million shares of MDMN under their Christmas tree??? HO…HO…HO…
Merry Xmas to all and to all a good night!
A JV will involve no upfront money, a considerable expense outlay being undertaken by the JV and MDMN receiving a 2-3% NSR once the project reaches production a few years down the road. Could be of considerable value but Auryn/MDMN/CDCH will not hold equity in the pro forma entity. Standard industry practice.
I agree with the general sentiment about how JVs with a major end for the junior. But I think Auryn has indicated the outcome for the entire property should be somewhat more complicated than this. As Auryn has again confirmed that they intend 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.
One can safely assume that with another year of planning under their belt they have a pretty strong conviction that such production will be meaningful and profitable. And once there is cash flow even on part of the property then there is a cash flow value to the property which is quite different from the ideas behind a JV.
It will be curious to see how they structure a JV. Will it be for only part of the property? Or will the terms instead just be more favorable on the larger targets (like the PN) because of the cash flow? Even large companies are interested in meaningful short term cash flow opportunities on long term products. Big copper companies in some cases have recently been selling long term gold streams on their copper properties to gold companies in order to fund the long term exploration and development of the copper resource. So if Auryn can develop that gold resource sufficiently with current production it could very well have as much value as whatever percentage or NSR of the copper / moly remains with Auryn after a copper exploration JV. Auryn’s strategy in all of this should be come much more clear in 2018.
Totally agree with your comments on the smaller scale gold production opportunities. They will be valued independent of the larger projects that are JV’d. I’d highly doubt that Auryn would consider JVing the entire property nor would any larger partner have as much interest in the Fortuna at this stage. So we will have a “sum of the parts” investment but the JVs will involve NSRs not equity. NSRs can be incredibly valuable but it’s going to take several years to fully recognize/discount that value. Either way, any headlines involving a JV with a major should add a nice bump to the share price.
If we are able to take the cash flows generated and use those funds for further drilling/exploration ( ie: do a good part of what a major would be doing in a JV ) in proving up the property would we be in a stronger position whereby we could retain a percentage of the equity in the proforma entity or at a mininmum, get a larger NSR ( 4-5% )?
In one of the write-ups from the Informational Meeting CHG commented that a JV partner would likely gain an increasing percentage ownership as it successfully drilled and defined the resource in 2 or 3 stages. There would likely be no NSR discussion until a PFS could define and model resource, mine life, production and capital cost. I recall an estimate that the initial phases leading to production could take 7-10 years. This is why an early JV would be more desirable than expending early cash flow on such an effort. Any JV will take on the major drilling/exploration expense and provide the expertise leading up to a PFS which will take quite a few years. A smaller NSR of 2-3% after a PFN has determined the target area to be economical is more likely and the industry norm. Announcement of a JV with a major or mid-tier producer will certainly benefit both the short-term shareholder and the long-term investor.
AURYN announced it’s intent on becoming a junior and major mining company. AURYN will likely look to meet or exceed it’s earlier annual gold production goal of 75K oz. Rapid development on gold production opportunities leading to substantial cash flow will override any extensive drilling on the PN or LDM. Expect the high grade vein in the Larissa Adit to be one such opportunity. Efforts to self fund by maximizing production on the Caren vein are necessary to fund expansion to reopen the Fortuna mine, IMO. The focus will be on the easiest and most rapid projects leading to cash flow, not those that will be an excessive cash drain.
It does in fact look like our guys are looking to first focus on easy income opportunities. Why would they bring in Dr. Sillitoe, unless they were thinking along those lines? Major Mining companies have their OWN people to evaluate/plan/design projects, right? If there is a way we can do BOTH (grant a JV on one part of our property and produce on another), it would probably be best for us…
I don’t know the answers to any of the questions/speculation that’s been going on here, but I do know that it sure is nice, after about a decade and a half (for me), to see the only topic of discussion on this forum being about mining and our future as a company!
Endless amount of shares for sale @.0035
Regarding NOL carryovers:
These regs are basically half a century old and can no longer be relied upon. Subsequent tax legislation including P.L. 99-514, P.L. 98-369, P.L. 97-248, P.L. 96-589, P.L. 94-455 substantially changed this antique. Treasury Dept. is way behind updating regs. Go to the IRC not ancient Treasury Regs if you want to learn what current law is. Or hire a tax attorney or CPA. I wouldn’t hold out much hope for MDMN’s NOL carrying over to a succeeding entity for any number of reasons.
I’m showing .0033x.0035 (3.9 million x 900k) with 7.6 million traded. The 5 million share block that had been sitting at the ask was taken out this morning when the bid was .0032x.0038. I would think we shouldn’t be in the .003s much longer, but what do I know?
Medinah’s books are totally unaudited. Les cooked the books for twenty years. If the IRS wanted to audit there is no way MDMN could stand up and prove the NOL numbers. No reason to chew that bone. Just wait and see what happens.
Earlier I saw to 2 3 million share blocks go off at the ASK😃
Then a 3 million share BID popped up towards the close
Hopefully the seller disappears after this week. I’m not sure why someone would be selling aside from year end tax losses. As I previously explained, there is a compelling arbitrage opportunity with MDMN’s share price, though obviously it is not a guarantee. Although there are still logistics necessary with regards to the consolidation, with that news behind us, I’m hopeful for some sort of geological update. I think that is really what the market is looking to hear.
Audited GAAP financials /unaudited bogus financials and tax basis net operating loss carry forwards are completely different animals with no relationship in this context. But I agree, they won’t be relevant whatsoever.
Not sure that they have much geology stuff to tell us. We know that likely as of a month ago, they probably hadn’t started full gold production yet and it is very unlikely they have done much significant exploring of the rest of the mountain since they have been looking to conclude a JV for more than a year.
It would be nice to see the Silitoe report but recall that he was simply reviewing existing geology information that was available almost a year ago.
I think the key here is a positive announcement about gold production and the signing a JV(as good or better than an industry standard agreement) with a Major that will be the signal to kick start the “massive” planned exploration program.
I am quite curious why it appears to be taking so long to conclude a JV since they have been taking about for more than a year.
Have they concluded one awhile ago and simply not told us? Unlikely
Are they holding out for better terms? Possibly.
Have the potential JV partners (or Auryn) simply require something to be completed first? (Private to Public, acquiring more claims, completing due diligence.) Possibly.
Are there multiple Majors involved adding to the complexity to completing a JV? Possibly…as it has always been assumed that ultimately a consortium would be needed to fully develop the mountain and spread out risk.
Looking forward to the answers to these questions in the New Year!
NOTE TO MODERATORS: Seems little reason to continue to split the Cerro/Medinah discussions threads since now the Companies are nearly completely linked together as a poster can’t really talk one about without talking/referring to the other. This comment coming from the one most in favor of the split discussion threads previously. Please consider. Thanks!
WELL MIKE it was you who made us split these two in the past where 99% of us told you they one in the same! LOL