Medusa Share Discussion Threads

[nielsc] 27/7/2016 21:00

Ilostthelot,Gold pushing up should make the higher AISC less of an issue hopefully.Cheers,Niels

[ilostthelot] 27/7/2016 14:39

Hopefully the market likes it. They said that costs would drop around August yet have told us to expect AISC of 1000-1100. Are they expecting higher costs when sinking the shaft?

[ilostthelot] 27/7/2016 14:35

The AISC is still a bit to high.At least they've hit the 108k Ozs.

A sensible production target for next year. Another $5M banked. This time next year we'll be sitting on close to $45 M with the service shaft hopefully complete and we will be a cash cow once again.

[stevea171] 27/7/2016 09:43

Medusa releases Q4 production report after market close today.
Mixed bag as could have been expected ....

CORPORATE
The Philippines Department of Environmental & Natural Resources, through Memorandum
Order No 2006-01 dated 8 July 2016, requires mining companies to be ISO14001 certified.
Medusa’s Philippine entities’ are ISO14001 certified on 23 June 2016.

FINANCIALS
As at 30 June 2016, the Company had total cash and cash equivalent in gold on metal account
of approximately US$22.0 million (31 Mar 2016: US$16.8 million).
The Company sold 25,519 ounces of gold at an average price of US$1,331 per ounce in the
June 2016 quarter (YTD: 108,529 ounces sold at an average price of US$1,173 per ounce;
Mar 2016 quarter: 20,999 ounces sold at an average price of US$1,173 per ounce).

[roguetreader] 25/7/2016 20:34

For further balance and a different perspective, I have copied Stevea171's post from Hotcopper (Steve hope you don't mind):

'From the 2015 Medusa Annual Report:
WORKFORCE. The Company is an equal opportunity employer that aims to provide a safe and healthy, hazard free work environment. As at 30 June 2015 the Company employed 2,471 regular workforce and 2,774 contract workers (mining, engineering, service provision, etc.).

This workforce of approx 5,200 is about 95% plus local Philippino people with only a few % ex-pats. So approx 5,000 local people who rely on Medusa for their jobs, pay taxes, receive benefits of schools for their kids, local facilities, etc provided by Medusa.

Does anyone seriously think the new Government is going to close down Medusa, put all these people out of work, lose taxes and political support from such a significant employer who is expected to be ISO 14001 compliant within a few months in accordance with the directive from last year of the Department of Environment and Natural Resources issued Administrative Order 2015-07.

Gina Lopez says she wants to replace eco-destructive mining with eco-tourism. Medusa has a very small footprint as it's an underground mine. It is integrated into the local community and has a history of more than 10 years of working with the local people. Lets see 5,000 local people find new jobs running eco-tours 12 months a year for a few wealthy American and Aussie tourists in a tiny past of the island of Mindanao!'

[goldminer70] 25/7/2016 16:38

Greenleaf wrote
down 7% ouch!
what was that about?


I have long believed that Medusa is a leaking ship. It is not surprising, Chip wrote that there were 4,800 Pilipino and 48 expat employees at Co-O, If I were a mining analyst I would searching for inside information of what is happening at the mine. I am sure the price I would have to pay a spy for the information would repay itself several times.

When the production fell a couple of years ago, due to refurbishment the shareholders were not aware how much the production had fallen, but the market seemed to know. In April 2013 production fell 23% from the previous quarter, and the share price fell 25% in the last month to the day before the announcement.
In Jan 2015 production rose 28% from the previous quarter and the share price rose 40% in the last month to the day before the announcement.
This pattern has followed fairly consistently.

A month ago the share price was 68 Aus Cents and it rose to 78 cents 2 weeks ago and I was optimistic the results were going to be good, but falling back to the level they were a month ago makes me think they will be about the same as the last quarter (although the PoG has risen).

Incidentally I did an exercise on when the announcements were made. Of the last 16 announcements, 8 have been made on a Tuesday, and 4 on a Thursday.
But recently, like all information from MML it has been as late as possible. With 31st July on a Sunday I think it will be between tomorrow and Friday, more likely at the end of this week.

Goldminer70

[roguetreader] 25/7/2016 16:02

Chip
I agree with your core points above. My thoughts were / are that if Co-O was to be impacted by this change of law and its application, then if applied 'consistently ' across the country, mining within the Phillipines is likely to be hit vey hard indeed. So from that perspective I think the probability of it happening is unlikely, however, the actions of politicians with a 'cause' can never be fully discounted, hence, my attempt to step back and assess my own objectivity. I am also wholly discounting Bananghilig from any contribution to getting MML to fair value at the moment so am not overly concerned with the impact of the law changes from that perspective, in the short term.

I think if the circa 4,800 jobs plus all of other ancillary positives that MML brings to the local community were to be put at risk by this change, it would generate significant local protest. I am going to sit tight and hopefully we get positive clarification soon. In the mean time hopefully Boyd has some good news from MML this week with the Quarterly report!
RT

[chipperfrd] 25/7/2016 12:38

RT

According to the last time I updated my notes re employed staff at Co-O, it was 4,800, but may well have changed since. Of those, 48 were expats.

As for the new political incumbents and their stance on mining, I am adopting a "wait and see" attitude. MML have been working Co-O for many years and appear to be well integrated within their community. Hurting existing operations that employ significant numbers plus the ancillary services and community benefits (taxes, schools, medical, farming loans, et al) that accrue would appear counter-productive, but who can tell with politicians!

However, any anti-mining stance might well make new start-ups and licencing applications more difficult or time consuming, which might well further delay any progress at Bananghilig - but there is clearly nothing in the MML price that reflects that, or any other, additional future operations for MML anyway.

Whether the rhetoric will result in a general slowdown of mining in the Philippines is a moot point. Incoming politicians often have to modify their attitudes when faced with the economic outcomes of their decisions, so I will wait and see.

In my view, MML is already very under-valued based on it's fundamentals so I have no intention of reducing my own holdings. But I do have a lot of other PM stocks so I am not proportionally over-exposed. Perhaps I might feel somewhat differently if I held a larger weighting within my overall portfolio.
Chip

[roguetreader] 25/7/2016 11:21

I see cncventure has made an interesting post on Hotcopper, stating his reasons for reducing his MML holding around the new government's anti mining legislation. Whilst having my own concerns and understanding his reasons, with Medusa's environmental track record and them being a narrow vein mine rather than a open pit, I am currently viewing cnc's worst case scenario as unlikely (see his post on Hotcopper for detail). However, having been burned on a number of occassions over the last few years I am somewhat more risk averse so would be interested in other opinions around the possible impact of this legislation on MML.
RT
P.S. does anyone know how many people are employed at the Co-O mine?

[greenleaf] 25/7/2016 10:58

down 7% ouch!

what was that about?

[augustusgloop] 25/7/2016 06:00

From chip's post on the MML numpty thread

For interest I have applied this methodology to some of their earlier years and get the following for their All-In Costs (AIC) - ie not just their All-In Sustaining Costs (AISC). Obviously, their AIC went very high during their maximum expansionary Capex years.

FY 11 ~ $733/oz
FY 12 ~ $1926/oz
FY 13 ~ $2120/oz
FY 14 ~ $1826/oz
FY 15 ~ $1079/oz
FY 16 ~ $950/oz (est)
-------------------------------------

You must have a different definition of 'expansionary' than I do.

2011 production - about 100k ounces
2015 production - just under 100k ounces

Thus in this period, there was no expansion what so ever.
Thus, your AIC is really AISC.

They lied when they said that the capital expenditure was to increase production - the results clearly show that it wasn't even enough to sustain the earlier production.

[stevea171] 22/7/2016 16:42

Tightfist. Hi. Yes, the assumption must be it will be the new CEO. I hope he will be wearing a bullet proof vest and steel knee caps!

Not his fault I know but until there are some sackings or resignations from the Board I doubt he will get much of a hearing from Institutions or anyone else, let alone anyone put any new money into the company the way things stand.

I would like to go in a masochistic way to hear what he has to say and make a first hand appraisal but I may be in Ukraine. TBD. Yes, would be nice to meet up with you and others if I'm not away.

[tightfist] 22/7/2016 16:18

Hi Steve,

Thanks for the heads-up on the Medusa presentation in London on September 8th; I guess it will be Boyd Timler flying solo, now that Ribert Weinberg has resigned. It's reassuring that a London presentation is still supported, maybe Boyd wants to build bridges with CF Ruffer Gold, now the largest ii.

I will be going on the 8th and hope to meet some other BB'ers there. We should have (Q4 production and 2017 guidance next week) the final results published before Sept 8th and, I hope, the outcome of the consultants strategy review should they decide to share it with us?

Cheers, tightfist

[chipperfrd] 22/7/2016 13:20

Hi Niels,

Sorry, I did not notice you were quoting for the total short position. I always net out the Longs - so it's habit and built into the bottom-line of my COT spreadsheet!

Commercials total futures short positions in silver work out at 23,974 tonnes and with options added it comes to 25,786 tonnes. It would appear that it is the futures + options figure that you are quoting.

All the best.
Chip

[nielsc] 22/7/2016 12:56

Chipperfrd,Yes a very tongue in cheek question.Getting my numbers from hereHttp://www.cftc.gov/dea/options/deacmxsof.htmNote I was just quoting the commercial short position, not the net short position of the commercials. They may very well be pitted against each other.Cheers,Niels

[chipperfrd] 22/7/2016 09:10

Niels,

I'm sorry, I get a different result to you for the report on the 12th.

Commercials were long 54,035 silver futures contracts and short 154,155 contracts. Hence net short 100,120 contracts of 5,000 oz per contract.

This equates to 100,120 x 5,000 = 500,600,000 oz. Dividing by 32,150.7 to get it into metric tonnes gives 15,570 tonnes. At that level they are at an all-time high and they comprise 47% of total Open Interest, which itself is at an all-time high of 33,377 tonnes.

You are obviously joking when you say "do you THINK that there could be naked shorting going on"? Clearly, given that the COMEX is a paper market, it is pretty much ALL naked!!

With Open Interest currently at well over a full year's silver production from all global sources there is no possibility that anything like that amount of silver could be held by futures traders. But as futures are purely paper derivatives of the metal no one should expect such a market to actually back it's paper with anything other than a token amount of actual physical.

What futures traders do with their cash is no business of mine. But what I object to is the price of those derivatives being used to price the world's trading of actual physical!!! That is a complete SHAM and a disgrace!
Chip

[nielsc] 22/7/2016 08:15

Chipperfrd,

o/t

Interestingly the commercial silver position on the COMEX as of the 12th July shows the longs decreasing their position by 229t while the shorts added another 34t to their position. So the commercial short position now stands at 25786t.

Given that in 2015 global silver production was 27589t that is a pretty hefty short position. Do you think there could be naked shorting going on perhaps? ;-)



Will see tonight if the short position has increased any in the effort to push silver down.

Cheers,
Niels

[aim_trader] 18/7/2016 13:23

Medusa Mining will be presenting to investors at the Chesterfield Mayfair Hotel at the Proactive One2One Investor forum on the evening of 8th September from 6pm. To register to attend this event, please click here:

[stevea171] 17/7/2016 09:37

This new Mayfair presentation by Medusa is likely to be after FY results.
Can it be they have some good news to present for a change?

Proactive Investors One2One Investor Forum - London

FERRUM CRESCENT LIMITED ORD NPV (DI)
Landore Resources Ltd.
Medusa Mining Limited

Sep 8th 2016, 6.00 pm
Chesterfield Mayfair Hotel, 35 Charles Street, Mayfair

[chipperfrd] 14/7/2016 15:40

Indeed Niels!

COMEX open interest for Silver was 32,868 tonnes as of the 5th July report. Clearly this is somewhat higher than annual production of silver from all sources!

422 tonnes of silver contracts stood for delivery in May. Followed by 95 tonnes in June. July delivery is moving up by the day and currently stands at 247 tonnes.

The Commercials were net short 15,360 tonnes on the 5th (yet another record high!!).

COMEX vaults allegedly hold 779 tonnes as Registered for delivery (down from a maximum of 2,186 tonnes on 1/4/15) and 3,972 tonnes of client silver (down from a maximum of 5,069 tonnes on 15/10/15).

So it is well set up for a big move!
Chip

[nielsc] 14/7/2016 15:14

Chipperfrd,I heard Eric Sprott raising the possibility that some of the bullion banks have broken rank and they are no longer all acting in unison.Looks like gold is being beaten down to try and control the price of silver. I feel that silver is going to be the one that breaks free from the shackles of the Comex first.Cheers,Niels

[ilostthelot] 14/7/2016 12:28

Thanks Chip.

[chipperfrd] 14/7/2016 10:23

Interesting new website that constantly checks the arbitrage opportunities offered by the difference between the LBMA/COMEX paper prices and the Shanghai metal prices.

Quite how valid it might be is a moot point - only time will tell!



Chip

[ilostthelot] 14/7/2016 09:48

That's the gap filled on the gold chart , hopefully a bit of consolidation above $1300 now before the results send us over a $1.