Why is the takeover of Aurelian Resources relevant to Century shareholders you may ask. Well Kinross is paying $88 per inferred ounce for Aurelian's 13.7 million inferred ounces in Ecuador. Ecuador! At one end of the mining friendly jurisdictions in the world you have Quebec, Canada and near the other end you have countries like Venezuela, Bolivia and Ecuador and some African countries.
In April, the share prices of all mining companies operating in Ecuador took a beating after the government adopted a decree that would suspend mining activity in medium and large-scale exploration projects, and revoked concessions, limiting the total concessions held by one company to three. Shortly thereafter Aurelian suspended operations.
Ecuador is planning to introduce new mining legislation to give the country more control of mining and a much larger share of revenues. In the face of all of this adversity, Kinross offers $88/inferred oz - a premium of 63%. This shows how much the majors need replacement ounces.
At the other end of the scale, Century has almost 5 million ounces, primarily in Quebec. Discounting the value of infrastructure to mine those ounces and outstanding debt, those ounces are currently valued at less than $2/ounce and 1.3 million of those ounces are reserves.
I simply can't imagine someone not offering 10 times this amount for those ounces and even then it would be a small fraction of what Kinross is paying for ounces in Ecuador.
It is simply mind-boggling that we are at 5 cents per share. I see Wega refusing to accept more than 5 cents per share again today. As their offer of 5 cents is taken out, they keep replacing it and have already sold 1.2 million shares today and they sold 2.6 million shares yesterday.
8 comments:
Wega is simply exercising their agenda such as it is. I hear whispertalk that PK will let go of the CMM reins. Of course, until it is in writing it is a rumour.
The Lamaque mine ... is it suffering from the McWatters days? How much confidence can anyone put in the recently filed 43-101? Does anyone reading know enough about Lamaque/43-101 to offer an opinion?
Carib, can you contact Kinross and point them in PK's direction?
You are absolutely right, Carib; about this sordid CMM saga being mind-boggling.
I wonder whether Wega's relentless dumping can not be considered a form of share price manipulation, with the sole objective of punishing PK(or could there be other more sinister objectives? e.g. drive CMM into bankruptcy & pick up the pieces at fire-sale prices?). And us poor retail shareholders are just "collateral damage". Mind-buggling, indeed!
Carib. How bout putting a daily
estimate on how many shares we
think Wega has left on the blog.
I know not all RBC sales are
Wegas but I'm sure most are.
roxy, it's almost impossible to say how many shares Wega has left.
This is what we do know:
According to Sedi filings, on Feb 1, they owned 25,557,646 shares.
Of these 25+ million, 12,074,500 were bought in the market, primarily through RBC and Byron, and 13,483,146 were acquired in a PP. We don't know what brokerage handled that transaction, but my guess that it was Canaccord since they appear to be Century's broker.
As of the last Sedi filing, Wega claimed to still hold 15,355,146 shares - a reduction of 10,172,500 - all sold in the market by RBC.
Since June 1, Canaccord has sold 12.9 million shares. There is no other institution other than Wega with that number of shares. Of course it could be several large retail shareholders or someone like Wega shorting the stock through Canaccord. It's impossible to know.
Since July 4 when Wega last declared insider sales, RBC has sold another 5.94 million shares with 4.5 million of those in the past 2 days.
We know from the numbers now that not all of the combined Canaccord/RBC selling came from Wega because the combined sales are in excess of 28 million shares (unless they are shorting more shares than they own/owned and considering the vindictive nature of their selling, that is entirely possible).
If none of the Canaccord sales are from Wega selling/shorting the stock, then Wega may still have close to 9.5 million shares. That's only $475,000 worth if they keep selling at 5 cents.
There is however no limit on the number of shares you can naked short through Canaccord on the TSX-V.
Today's trades have been posted.
optimusprime,
How much confidence can anyone put in the recently filed 43-101?
I am beginning to wonder the same thing? If Wega noticed something in the Lamaque 43-101 don't they have to report it to the proper authorities?
Nino, well someone did complain to the BCSC about the way the 43-101report was originally written by the independent consultant. BCSC instructed CMM to revise it using the proper terminology, that was more definitive and conclusive. The reserves were re-calculated and remained unchanged. The BCSC reviewed the 41-101 and accepted it for filing. The SJ 43-101 was calculated in accordance with the BCSC requirements for Lamaque by a separate independent consultant. The Blaine office has 8 employees poring over all the Lamaque geological data that covers 5 or 6 decades, and are entering into the Vulcan software model. When viewed on a computer monitor all drill holes are detailed and 3-D images are generated. They're 100% complete to the 500 foot level and 60-70 % complete to the 1000 foot level. The model outlined 100,000 previously unknown ounces in the West Plug.
Wega invested in Century Mining last year when CMM did not have 43-101's for either the Lamaque or San Juan. Read their banker's reports (Pareto Securities), they clearly stated that although there are no 43-101's, they are not worried, they know the gold is there. Interestingly, they ridiculed Bay St. and Wall St. for being sticklers for 43-101's. Wega did all their 2007 DD without the 43-101's. If anything, the Lamaque 43-101 should have given them confidence that there are 4.6 million ounces.
One sad part (of many sad parts) about our situation is that there is essentially no significant new gold deposits being found. The larger companies don't really explore and the junior companies are no longer finding any new deposits of relevance. In addition, the large deposits that are held by junior companies are being gobbled up by larger companies at a rapid pace, especially in Canada. Yet, here we sit with 4.6M ounces (and counting) in the most well regarded mining area in the world (Quebec, Canada). It's too bad we don't have the cash to ramp up tpd to a high enough level where economies of scale can take effect, and demonstrate to the market that Lamaque can handle the cost pressures of today's economy.
With 4.6M ounces of gold (and potential to get beyond 10M ounces one day, especially with the surrounding properties within our portfolio), and world wide gold deposits becoming depleted (with no new significant decoveries), Lamaque is bound to one day become a valuable asset. It would be real sad if we no longer own it when it reaches that stage.
By the way, I have previously mentioned 4 possible directions that might work well for Century, but I forgot to mention a 5th scenario (which I have been thinking about for a few weeks now, if things broke down with getting major financing dollars). The 5th possible direction is to try to get a deep pocketed J/V partner to buy their way into the project (there are some companies out there in unsafe environments, with large cash positions, that might want to gain better balance by deversifying into Quebec). If it's a mid-tier J/V partner then we could give up operating control to the bigger company. With proper capital infusion and better management then perhaps the 150,000 annual ounces might one day also still be attainable.
Anyway, (I mentioned earlier about large junior deposits going fast) here are just a few examples of large junior deposits that have been gobbled up by larger companies in recent times:
1) Marimar (Canada) by Newnmont
2) Aurelian (Equador-unstable) by Kinross
3) Viginia's Eleonore (Canada) by Goldcorp
4) Viceroy (Argentina-unstable) by Yamana
5) Cumberland (Canada) by Agnico-Eagle
All of the sellers received mega dollars for these deposits.
Lamaque will have its day. The question is will it still belong to us shareholders when it reaches that point or will it be sold by us prior to then for a fraction of it's true value?
Sure is vewwy,vewwy quiet around here. I see Wega still going at it, wonder if we will ever find out WHY?
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