MUX is a new recommendation this month in the only investment newsletter I subscribe to, fwiw. Looks like they’re getting some more attention.
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MUX is to high for me now, I think MDMN is a better deal.
My opinion is mux is a bit overpriced for the moment. I would say about 2.00 would be a fair value at the moment
Really…why? They have no debt, something like 60 million in the bank, hitting their projections and are in the process of getting permits for a new mine in Nevada(construction likely 2018) and throw off a small dividend twice a year. Oh and the big boys have been taking larger positions of late.
It will go higher, but you won’t have a 10 bagger, maybe $6 t’il year end.
Anyone looking for a company with really good leverage to silver prices may want to have a look at Bear Creek Mining. Market cap of around $300 mill. The NPV of their deposit goes up $60 mill for every $1 increase in silver, if lead and zinc go up at the same % to silver than the NPV goes up $120 mill. If/when the mine (open pit) is built the first five years they will have a negative AISC due to their high zinc and lead in one area of the deposit. After that, estimated AISC is under $4/oz silver for life of mine. Mine payback is under four years and strip ratio is around 1.7:1.
They are also in arbitration right now with the govt of Peru after their permitting for another mine was pulled for supposedly political reasons. They are very confident that they will be getting some money from the settlement, all of which would go towards their current project and would reduce the money needed for capex by 10-40%
I spoke with management for quite a while at a recent Vancouver conference and they think they are in a good position moving forward. Large institutional and insider ownership. They were at the Sprott conference last year which means the Sprott group is invested. I know of at least two of the newsletter writers are also recommending it at the moment. If silver goes on a tear over the next few years, this one should do extremely well.
MUX is a far safer play than MDMN and hundres/thousands of other junior miners. It may not have the potential upside (not sure how high MDMN’s upside is at this point), but you will not lose your shirt with MUX…unless the price of gold collapses. With MDMN, we’re looking for a final out play…we always have been. There is no guarantee there as history has acutely shown all MDMN shareholders. MUX is an investment you buy and hold for a long time…collect dividends while it steadily increases share price over time.
That being said, MUX is a bit pricey right now if you’re looking for an entry. I’d prefer to wait for pullbacks to take positions in and dollar-cost-average accordingly.
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Myself, with MUX I keep a core position that I don’t trade. Then I have some that I flip when the price is up and buy back in on the dips gradually increasing my position with the profits. That’s just me 
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A head’s up on the gold chart for anyone interested. (I’ll try to post the chart I’m talking about once I comment, but I’m using software from my broker and not sure if it will post).
On the weekly interval chart, which is a pretty big picture view, gold futures opened above the convergence of the 20 ema and the 130 ma, so there’s some good support at the 1220 area. The next resistance area on this chart is at the 50ma which is currently right around 1270. My guess it it will find some resistance somewhere in the 1250 - 1260 range, which would occur at the white moving avg. on the second chart I post (if I can). If it pushes through then it should get into the 1270’s. If it breaks through there then we could see a move into the 1300’s in a month or so depending upon how strongly/quickly it goes.
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Silver is in an interesting spot here. On the first daily interval chart, silver hit the white 130ma and has found resistance for now. The green above it is the 200ma. The second chart is the weekly interval showing that, for now, the price is above the weekly blue 50ma. If you look at the candle from the previous week, silver moved above that MA but closed below it. So there’s some evidence to support a pullback for silver from here. I’ll update when there’s more clarity.
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Silver made a run to just under its 200ma (green line) on the daily chart I’m posting here. Gold had a decent run at the same time. It’ll be interesting to see what they do from here. Kind of interesting to see gold and silver rising along with the Dow & S&P.
Gold looks like it is getting ready to test resistance at the 130ma (white line on the chart) right around 1252.00. If it does silver should go with it. We’ll see if that momentum moves silver above its 200ma.
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McEwen Mining Announces Friendly Acquisition of Lexam VG Gold
TORONTO, Feb 13, 2017 (GLOBE NEWSWIRE via COMTEX) –
McEwen Mining Inc. (“McEwen Mining”) MUX, +0.71% (MUX) and Lexam VG Gold Inc. (the “Company” or “Lexam”) (LEX) (otcqx:LEXVF), have entered into an agreement pursuant to which McEwen Mining would acquire all of the issued and outstanding securities of Lexam by way of plan of arrangement (the “Arrangement”) and Lexam would become a wholly-owned subsidiary of McEwen Mining. The proposed arrangement is subject to approval by the shareholders of Lexam.
Pursuant to the Arrangement, each Lexam common share (a “Lexam Share”) would entitle the holder to receive 0.056 of a McEwen Mining share (the “Exchange Ratio”). Lexam shareholders would receive a premium of 30% to the 30-day volume weighted average price (VWAP) of the Lexam Shares.
“Lexam’s assets include multiple advanced exploration projects located in the prolific gold camp of Timmins, Ontario. Lexam’s primary projects are past producers with defined resources and excellent infrastructure. The proposed transaction would give the Lexam shareholders access to McEwen Mining’s technical and financial resources enabling the projects to be advanced towards production. Lexam shareholders will also gain exposure to a growing gold and silver producer, with a diversified portfolio of projects throughout the Americas,” commented Rob McEwen, Chief owner of both McEwen Mining and Lexam.
Benefits of the Transaction for Lexam Shareholders:
Ability to fund development and construction of the Timmins Properties with McEwen Mining's existing financial resources;
Access to McEwen Mining's experienced and disciplined management team with an accomplished history in gold exploration, open-pit and underground mining, and mine development;
Exposure to McEwen Mining's diversified portfolio of producing operations and development projects; and
Lexam shareholders receive an attractive premium of approximately 30% to the 30-day VWAP of the Lexam Shares and greatly enhanced liquidity of dual stock exchanges within the US and Canada.
Benefits of the Transaction for McEwen Mining Shareholders:
Adds Measured and Indicated gold resources of 1,468,500 ounces and Inferred gold resources of 954,000 ounces to McEwen Mining's resource base in a premier geopolitically stable mining jurisdiction;
Enhances McEwen Mining's development and production pipeline with the potential to commence production of the Timmins properties within 24 months; and
Substantial exploration potential.
Details of the Arrangement
If the Arrangement is completed and based on the current outstanding Lexam Shares, McEwen Mining will issue a total of 12,689,709 shares of McEwen Mining common stock (the “McEwen Mining Shares”) to the shareholders of Lexam. Based on a price of USD $4.23 per McEwen Mining Share, being the closing price on the NYSE on February 10, 2017, the Exchange Ratio represents an offer price of CDN $0.31 per Lexam Share, being a premium of 30 % over the volume weighted average price of Lexam Shares for the period comprising the 30 trading days ended on February 10, 2017.
In order to comply with NYSE rules, Robert R. McEwen will not be entitled to receive newly-issued shares of McEwen Mining representing more than 1% of the currently issued and outstanding shares of McEwen Mining without obtaining the prior approval of McEwen Mining shareholders, which is expected to be obtained at the next annual meeting of McEwen Mining shareholders. If such shareholder approval is not obtained, McEwen Mining will pay for such excess shares in cash.
To be effective, the Arrangement must be approved at a meeting of the shareholders of Lexam (the “Lexam Meeting”) by: (i) at least 66 �…"% of the votes cast on the resolution to approve the Arrangement by the Lexam Shareholders present in person or represented by proxy and entitled to vote at the Lexam Meeting; and (ii) at least a majority of the votes cast on the resolution to approve the Arrangement by the minority Lexam Shareholders present in person or represented by proxy and entitled to vote at the Lexam Meeting. The minority shareholders are defined by securities legislation and, among others will exclude the shares of Lexam held by the directors of McEwen Mining, including Mr. Robert McEwen.
The Arrangement agreement includes customary deal protection and non-solicitation provisions in favour of McEwen Mining, including a break fee of $2.1 million payable to McEwen Mining in certain circumstances, and fiduciary out provisions for the benefit of Lexam. Lexam is entitled to a reverse break fee of the same amount payable in certain other circumstances.
Completion of the Arrangement is also subject to certain other conditions including approval by the TSX, the NYSE and the Ontario Superior Court of Justice (Commercial List).
The Arrangement was approved by the Board of Directors of each of McEwen Mining and Lexam upon recommendation, in each case of a special committee of independent and disinterested directors, after the special committees consulted with their independent legal and financial advisors. Messrs. Robert R. McEwen and Richard Brissenden noted their respective conflicts as directors of Lexam and McEwen Mining and abstained from voting in connection with the approval of the Arrangement by the Board of Directors of each company.
Overview of Lexam’s Timmins Properties
Upon closing, McEwen Mining will own 100% interest in the Buffalo Ankerite, Fuller and Davidson Tisdale properties, and a 61% interest in the Paymaster property, with the remaining 39% of mineral rights held by Goldcorp Inc.
Lexam controls a cluster of four past-producing gold properties, both with open-pit and underground potential. The properties are located within the world-renowned Abitibi greenstone belt in proximity to the Porcupine-Destor Fault Zone. Lexam’s projects are situated within two claim blocks, one in the northern part of Tisdale Township (the Davidson Tisdale block located approximately five kilometres southeast of Timmins city centre) and a second block of contiguous claims comprising the Buffalo Ankerite, Fuller, and Paymaster properties located in Tisdale and Deloro Townships roughly nine kilometers to the east-northeast of Timmins city centre. The relative locations of the properties can be seen in Figure 1 below.
Figure 1: Lexam VG Gold Property Locations: Attachment
ABOUT MCEWEN MINING (www.mcewenmining.com)
McEwen Mining has an ambitious goal of qualifying for inclusion in the S&P 500 Index by creating a high growth gold and silver producer focused in the Americas. McEwen Mining’s principal assets consist of the San Jos� Mine in Santa Cruz, Argentina (49% interest), the El Gallo Mine and El Gallo Silver project in Sinaloa, Mexico, the Gold Bar project in Nevada, USA, and the Los Azules copper project in San Juan, Argentina.
McEwen Mining has a total of 300 million shares outstanding. Rob McEwen, Chairman and Chief Owner, owns 25% of the Company.
Technical Information
The technical information contained in this press release has been reviewed and approved by Kenneth W. Guy, P. Geo, a consultant to Lexam VG Gold and a Qualified Person within the meaning of National Instrument 43-101 “Standards of Disclosure for Mineral Projects” (“NI 43-101”).
(1) Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
(2) The quantity and grade of reported Inferred resources are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured mineral resource category.
(3) The mineral resources herein were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council. For additional information about these mineral resources , see www.lexamvggold.com/resources.php, where all the technical reports used are available. These technical reports are also available under Lexam’s profile on SEDAR (www.sedar.com).
(4) Lexam’s resources are as follows:
- Open Pit: 35,500 ounces (“oz”) gold (“Au”) Measured from 0.45 million tonnes grading 2.44 grams per tonne (“gpt”) Au, 741,300 oz Au Indicated from 12.12 million tonnes grading 1.89 gpt Au, 358,400 oz Au Inferred from 6.28 million tonnes grading 1.79 gpt Au;
- Underground: 63,600 oz Au Measured from 0.36 million tonnes grading 5.56 gpt Au and 628,100 oz Au Indicated from 4.06 million tonnes grading 4.82 gpt Au, 595,800 oz Au Inferred from 4.24 million tonnes grading 4.35 gpt Au.
(5) The resource estimates contained herein do not constitute a Feasibility or Pre-Feasibility study and contain no mineral reserves within the meaning of NI 43-101 or SEC Industry Guide 7. The mineral resource figures referred to in this press release are estimates and therefore insufficient to allow meaningful application of the technical and economic parameters to enable an evaluation of technical or economic viability and no assurances can be given that the indicated levels of gold will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. While Lexam believes that the resource estimates included in this press release are well established, resource estimates are imprecise by their nature and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such estimates are inaccurate or are reduced in the future, this could have a material adverse impact on Lexam. In addition, this news release includes Inferred resources that are too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves.
All resource estimates reported by Lexam VG Gold are calculated in accordance with NI 43-101 and the CIM classification system. These standards are different from the standards generally permitted in reports filed with the SEC. For further information see http://www.lexamvggold.com/US_Cautionary_Statement.php.
Lexam is one of a handful of smallish Canadian miners that Rob Mcewen made a private investment in, not unlike Inventus. Shareholders have speculated that Lexam would be an eventual acquisition by MUX and that came to fruition today.
Hey Rick,
I assume most here give Rob the benefit of the doubt on his decision making, but do you have any thoughts on this acquisition outside of that?
I’m not very familiar with the specifics of Lexam other than their primary properties are in the heart of the Timmons historic mining district controlled by Gold Corp. No doubt McEwen was already familiar with this area due to his stint with Gold Corp and through Lexam he locked up the surrounding properties. I think the prospects are probably pretty favorable given the district and the players involved.
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There are a few miners announcing earnings this month for anyone keeping a watch list.
Not an endorsement, here are those with announcements I know of this month, FWIW:
PAAS 2/14
TAHO exdiv 2/24
AUY 2/16
AG 2/22
SSRI 2/23
Anyone here have others to add to this short watch list?
Also, for anyone interested in the Hot Maden deposit in Turkey (mentioned on the other thread by Brecciaboy), SAND has a 2% NSR on a portion of this deposit which is not yet in production. Mariana Resources’s Hot Maden discovery in Turkey is said to be one of the highest grade gold-copper discoveries made in the last decade.
Looks like watching was the right move to make!
Kerrisdale Capital Releases Negative Report on Northern Dynasty Minerals Ltd. (NAK) and Announces Conference Call Schedule
BY PR Newswire
— 9:30 AM ET 02/14/2017
NEW YORK, Feb. 14, 2017 /PRNewswire/ – Kerrisdale Capital, a private investment firm, has released a report on Northern Dynasty Minerals Ltd. ( NDMWF ) , a US$1.1 billion Canadian mining company that owns an undeveloped copper and gold deposit in Alaska. Kerrisdale believes that Northern Dynasty is worth nothing because its key asset is not commercially viable, which is why four major mining companies previously involved with the mine have abandoned it, by dumping shares of Northern Dynasty they’d previously bought, gifting shares to charity, or, in the case of Anglo American, simply walking away from their 50-50 partnership with Northern Dynasty even after sinking more than $500 million into investigating Pebble’s prospects.
The full report can be found at http://kerr.co/nak.
Kerrisdale has a short position in Northern Dynasty and stands to benefit if its share price falls.
Trading Halt
BY Canada NewsWire
— 10:35 AM ET 02/14/2017
TORONTO, Feb. 14, 2017 /CNW/ - The following issues have been halted by IIROC:
Company: Northern Dynasty Minerals Ltd ( NDMWF )
TSX Symbol: NDM
Reason: Single-Stock Circuit Breaker
Halt Time (ET): 10:23:23 AM ET
IIROC can make a decision to impose a temporary suspension (halt) of trading in a security of a publicly-listed company. Trading halts are implemented to ensure a fair and orderly market. IIROC is the national self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada.
Wow!!!
The short guys are always very smart and one step ahead of everyone else to be sure.
I went through their report and couldn’t find much obviously wrong about it.
The most damning part of it is that they purportedly have good info on the exact reason previous partners walked away and the allegations that Northern Dynasty deliberately withheld the results of feasibility studies that showed it was a net negative.
One interesting thing about the Pebble…despite what the shorts are saying it is a low grade deposit…it actually has a very large volume of high grade material but can only be mined by subsurface methods:
I wonder if they could simply go with an underground mine and mine it at a much smaller scale?
In any case, this report kills the project/investment unless a Major steps in again as a partner to validate things. I would expect shareholder lawsuits over all of this.
In how it relates to the Alto, it shows just how important it is to be close to infrastructure and have a decent grade because otherwise the capital costs to start up a large mine are so huge that there almost nobody left in the World that is willing to take on that kind of risk.
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Mike, i think we have (Medinah and Auryn), a much better property and close to a major city than Northern Dynasty Minerals .