Hey Bonzo, current share count 58,300,334
I think its time for some specifics and some real answers NOW, or that statue from the Nevada lawbook just might apply...
I think by end of business is only fair!
And please don't insult my intelligence with assays are looking better than expected..duh! would they say anything else. Answers are long overdue, remember form the AGM, wayyyyyyyy overdue!
Here's a worksheet, lets see if they can fill in the blanks!
WORKSHEET: PUTTING A VALUE ON MEDINAH
$/SHARE
ANDACOLLO RELATED
01)______ Mining value of Andacollo properties themselves- (234 claims in various stages of development, several ready for immediate production, limited drilling has already yielded 6 million tons @ 2gms AU/ton). In their in depth report to Sierra La Plata S.A. (Medinah's wholly owned subsidiary in Chile), The prestigious consulting firm of A.C.A. Howe Chile ltd. highlighted the following: 1) Two primary targets for development: - La Colorada, with zones 30 to 40 meters in width and strike zones of 250 meters open in all directions and averaging 2.05g Au/ton, and La Violetta, with gold outcroppings (0.28 million tons grading 1.29g Au/ton) and projecting south from the Dayton mine on to Medinah claims. Two additional targets areas are: the Mercedes, with drilled probable reserves of 810,000 tons grading 1.25g Au/ton, and the Toro, with probable reserves of 1.32 million tons grading 1.79g Au/ton. Additional testing on other claims show gold values ranging from a low of .41g Au/ton to a high of 3.12g Au/ton. Howe concurs with the Chevron study, indicating 3,303,000 tons at 2.37g Au/ton from vein material plus 33,430,000 tons at 1.31g Au/ton from manto structures, which remain to be confirmed by further drilling. Medinah's properties border the North and West edges of the Dayton Gold operation (130,000,000 tons of ore grading .70g Au/ton) and includes six claims within the Dayton boundaries. Medinah now controls more than 1750 acres in the Andacollo field (approximately 2.75 square miles) with additional acquisitions under negotiation. Further to evaluating and verifying data, Howe has completed the following field work: 1.) established a 40 kilometer (24 mile) gridline. 2.) magnetic surveys over gridded areas. 3.) Reconnaissance geological mapping. 4.) 1000 feet of hand trenching. 5.) 353 grab and channel samples. Given the above factors, Howe recommends a two-phase program: Phase I- Additional mapping, sampling, bulldozer trenching and geophysics surveying. Phase II- Drill testing on the target areas- 8000 meters (24,000 feet). Cost of the above project is projected at $1,350,000, funding of which is now in progress.
Other properties of merit at Andacollo controlled by Medinah include Cobre Morado, one to ten, Mina Verde, Berta one to five, Ultima one to three, Mac Pato, Alianza, Lanzazo one to four, Nicolas one to twenty seven, Corazon de Jesus one to two, Espacio one to four, Capacho one to five, Volcan one to sixteen, Maria Luz, Beagle, Gabriella, Nueva, Eduardo Uno one to twenty, Eduardo Dos one to twenty, Eduardo Tres one to twenty, Turista one to one hundred. In addition to these properties Medinah has registered numerous additional claim blocks over these areas to create more contiguous land groupings. On a map one can easily visualize Medinah's properties blocking the much needed expansion possibilities for Dayton.
02)______ Strategic value at Andacollo -Dayton or their successor desperately needs the surrounding properties, which are also of higher ore grade, to increase the mine life for this $110 million facility. Medinah has put together a very appetizing array of properties enclosing Dayton's property. Conventional wisdom would dictate one major taking over this whole area. The key here is the state of the art facility that Dayton has built. It needs a lot of ore to stay busy, the higher head grade of the Medinah properties is critical to increase the dwindling mine life of Dayton.
03) Victory in pending lawsuit in Chile. This would have far reaching consequences. The three properties in question have very high ore grades as well as tremendous strategic value- being in the middle of the Churamatta pit. A victory to Medinah would:
a.) Probably bring Dayton to the negotiating table on their knees.
b.) Make the U.S. and Canadian lawsuits a relative cakewalk. All eight claims for relief in the U.S. lawsuit seem to parallel the Chilean lawsuit. The idea of "blood out of a turnip" does not apply since Dayton has a $110 million state of the art facility, a large liability insurance policy, and the co- defendants are rumored to be carrying large liability policies also.
c.) Necessitate a compensation payment to Medinah for all of the gold retrieved from these properties over the last six to nine months, in addition to the compensation for the now famous bulldozing incident.
d.) Open the door for a major to come in and coalesce this entire area into one mining project utilizing the economies of scale present and the mining facility of Dayton. Up until the litigation at Chile was over the majors, had to sit and watch. Negotiations between Medinah and a certain major are at an advanced level currently.
e.) Finally give Medinah the credibility they sorely miss being a BB stock in the post Bre-x era. If management was indeed telling the truth about Andacollo then maybe the Santiago assets are as good as advertised.
f.) Perhaps cause the shorts to start covering-some shorts were probably betting on Goliath not David.
g.) Possibly exacerbate the downward spiral of Dayton leading to a potential liquidation, any awards made in the 3 trials may be attached to Dayton's plant, except for those covered by the large liability policies. A preemptive visit by the insurance carriers to Medinah would probably be expected. They would not want to go to court on this case. The Dayton facility itself is producing at a record pace of 10,000 ounces/month in October and November, and 11,000 ounces in December. Only $7 million is owed to the banking syndicate on the mill. To keep this mill busy in the near future and to extend the extremely skinny mine life, Dayton has to acquire the nearby properties for survival. The much higher head grade of the Medinah properties would seem very appealing.
h.) Possibly set up a bidding war between Newcrest and Dayton for Medinah's assets. Dayton needing them for survival and Newcrest to implement their area consolidation play.
i.) Induce a lot of buy orders to be triggered by fence sitters (especially in South America).
j.) Cause the debenture holders of Dayton to get involved, flexing their huge muscles, trying to salvage their $69 million investment in Dayton.
k.) Possibly cause Dayton's banking syndicate to pull out entirely.
04)______ A victory in the U.S. lawsuits.
05)______ A victory in the Canadian lawsuits.
SANTIAGO RELATED
06)______ Alto de lipangue (see Gordon House report) drilling to commence 2/2/99. This is the huge target recently delineated by the IP study showing a textbook pantleg anomaly, supergene enrichment zone,etc.
07)______ Las dos Marias (see Gordon House report). Drill targets include a large shear zone,
an intrusive body, and the mantos.
08)______ Carin and Puange placer properties (approximately 170 million cubic meters at 1.5 gm AU/ton=+/- 8.3 million ounces of Au). A Russian consortium and their attorneys are currently negotiating a deal for these placer properties. The consortium has been on site for several months testing. Their results were far in excess of Medinah's results of 1.5 gm Au/ton average. The Carin property will be the first to be developed. Much of the necessary equipment is already on site. SR. Juan Jose Quiano is brokering this transaction on behalf of Medinah. A large cash up front component could expedite the share buyback program.
09)______ Catan vein (2.8 km x 2.5M wide x 1000 m @ approx. 15.5 gm/ton). A 70-meter access tunnel was completed in mid December. Intersecting the vein 1,000 feet below its surface showing, truly an immense vein. This represents extremely near term cash flow as stock piling continues. Shipments to the refinery should commence by February, 1999. Channel samples by the company are averaging in the neighborhood of ½ oz. per ton (15.5 gm/ton), ACA Howe's team corroborated these n averages in late Jan.1999. ACA Howe's report will be out within a week or so (+/- 2/5/99). Distinct possibility of 8.2+ million ounces of gold.
10)______ Lucio vein
11)______ Loncomilla
12)______ Ipon island and other "Santiago" properties.
OTHER SOURCES OF VALUE
13)______ Extremely large, "built in" short position. Careful scrutiny of the trading over the last 18 months in conjunction with a recent share census has unmasked a potential 14-18 million share short position. Somebody or some company wanted Medinah to go away very, very badly. If Medinah pulls a stellar core at Alto de Lipangue in January, then this magnitude of a short position could fuel a very explosive market. Dozens of offers for financings and block purchases have been made by the shorts over the last 10 days, all have been refused. Holders of blocks of stock have been approached recently, they have also refused these offers. The shorts teamed up on the company about 18 months ago when the stock was at $2.35, management is having a tough time in forgiving them for the pain over the last 2 years.
14)______ Very high % of ownership by insiders.
15)______ The majority of people are in at much higher levels, past financing done @ $2.00.
16)______ The relationship with partner Juan Jose Quiano, professor of mining law, represents future access to other high quality properties, as well as a huge stamp of credibility for the company. Senior Quiano was approached by several majors before choosing Medinah.
17)______ A.C.A. How Chile recommends expenditures of $1.3 million on Medinah's Andacollo properties. These impressive properties have a tendency to get lost in the shuffle with all of the events occurring at Santiago.
18)______ The availability of 2 separate $10 million financing packages currently being evaluated. Raising needed capital has never been a problem for the company, some very deep pocketed individuals have been behind the company since day 1, they are big fans of Juan Jose Quiano and management.
19)______ Chile is currently 1 of if not the hottest spots on earth for mining expenditures.
20)______ Recently approved share buy back program will commence once cash flow permits. The nearest sources of cash flow are probably represented by an up front payment for the 2 placer properties by a Russian consortium of companies or the shipment of ore from the Catan vein.
21)______ Recent activity of Argentina Gold, Medinah's neighbor to the northeast, teaches us that the majors are in an acquisitive mood in this area around the Andes. Argentina gold also has a gold/copper porphry, their market activity may well serve as a template for the upcoming Medinah market. The current mining market is amply rewarding good drill results.
22)______ The infrastructure set up in Chile over the last several years, including working relationship with A.C.A. Howe and Company, the Chilean government, the setting up of the D.L. 600, the "S.A." post script to Sierra La Plata etc., Sr. Quiano and his mining, business and political colleagues, have created a very "well oiled" machine to do business in arguably the hottest mining area of the world.
23)______ The attention that Medinah has received from majors has been overwhelming. The upcoming drilling at Alto de Lipangue and Las Dos Marias will have a huge worldwide audience. Over the last 10 days the soon to be drilled Santiago properties have been inundated by the majors and their exploration teams. Negotiations are at different levels with the various majors, these are expected to go into high gear once drill results are obtained and/or the verdict and compensation are announced in court at Santiago. These results are due imminently.
24)______ Listing on the Frankfurt exchange (February 1999), if deemed appropriate by management.
25)______ Fully reporting status due in February, 1999.
26)______ Other properties in some very exciting neighborhoods. |
