AUM - Australian Mining Investments

[greggy]

Snippit from ABC news article today:
http://www.abc.net.au/news/newsitems/200607/s1685442.htm

Director Wayne McCrae says he has kept shareholders well informed and is putting their interests first.

"The only thing I'm interested in doing right now is drilling it up as quickly as we can, before a major mining house makes a bid for us, which may happen and it may not, but to get the best value we can for shareholders," he said.

Mr McCrae says the company has been put under the microscope.

"We've addressed all their concerns, I've been doing this for 30 years and I've addressed all their concerns all the time," he said.

"I guess one person looks at it one way and one looks at it another.

"But as long as the shareholders are happy, as long as the ASX is happy and ASIC are happy, I think everyone is happy."

Mr McCrae says he hopes the company's shares will resume trading today after being suspended.

If Wayne is right and the shares are relisted today then our wait is probably over.

 

[ALFguy]

If Wayne is right and the shares are relisted today then our wait is probably over.

Wouldn't that be nice.....But still depends on whether ASX are happy.

 

[noirua]

All the small mining stocks on the ASX will be watching the outcome of AUM with great concern. If anything goes disastrously wrong then the whole castle comes tumbling down. Comments in the Poseidon days: " I was walking across the tenement and kicked a rock, by golly there is nickel all over the surface of this place ", we know the result. Bre-X followed 18 years later and now AUM.
It would therefore be extremely surprising if the ASX allowed trading to start with the prospects of a boom collapse scenario staring them in the face.

 

[greggy]

All the small mining stocks on the ASX will be watching the outcome of AUM with great concern. If anything goes disastrously wrong then the whole castle comes tumbling down. Comments in the Poseidon days: " I was walking across the tenement and kicked a rock, by golly there is nickel all over the surface of this place ", we know the result. Bre-X followed 18 years later and now AUM.
It would therefore be extremely surprising if the ASX allowed trading to start with the prospects of a boom collapse scenario staring them in the face.

I agree. I'm hoping that things turn out well, otherwise we may have a bloodbath on our hands in the speccie sector. Still an optimist though. Better things to come.

 

[aobed]

All the small mining stocks on the ASX will be watching the outcome of AUM with great concern. If anything goes disastrously wrong then the whole castle comes tumbling down. Comments in the Poseidon days: " I was walking across the tenement and kicked a rock, by golly there is nickel all over the surface of this place ", we know the result. Bre-X followed 18 years later and now AUM.
It would therefore be extremely surprising if the ASX allowed trading to start with the prospects of a boom collapse scenario staring them in the face.

Actually, this raises an interesting question. Is it possible for the ASX to intervene and set an appropriate price for a share price in the instances where the market has managed to get the price quite wrong to protect the ASX? I'm not suggesting that is the case with this particular company but in general?

 

[ALFguy]

Actually, this raises an interesting question. Is it possible for the ASX to intervene and set an appropriate price for a share price in the instances where the market has managed to get the price quite wrong to protect the ASX? I'm not suggesting that is the case with this particular company but in general?

I would be shocked if they had that sort of power. Who are they to decide on an appropriate trading price! :

 

[greggy]

I would be shocked if they had that sort of power. Who are they to decide on an appropriate trading price! :

Share prices should be left to the free market to decide, not the ASX, especially when they are so SLOW in taking any action.

 

[ALFguy]

Sure this has been mentioned before but just for clarify.
Once the announcement is out, how long before trading resumes?

Also, if/when we go into pre-open, would someone be so kind as to post an updated IAP? please!

 

[parmigianich]

Gruezi..
Just joined- hopefully I will become a regular

I bought up almost 100,000 AUM shares back in Feb on my fathers advice at an average price of $0.165. At the same time he was pushing me towards CitiGold (CTO) and I accumulated over 300,000 shares in CTO for an average price of $0.1675. CTO has been trading in the $0.30- $0.40c range for the past couple of months so by no means have I done badly there but still it would have been nice if I rather had bought a few more AUM. lol. I sold about 90% of my holding in AUM Monday last week as soon as they hit $3 and am happy I did so despite them trading as high as $10 just 2 days later. I am gernerally quite skeptical about the prospects of the so called discovery but I really don't have much of a clue. The company definitely seems to have handled itself poorly but maybe in some sense that is almost to be expected from such a junior exploration company. Hopefully and more importanly their technical skills and integrity are up to scratch. Talking to my father he seems to think, for those that missed the boat with AUM, that Sedimentary Holdings (SED) could potentially be the next AUM. They are a gold exploration company and have a 30% interest in the Cracow gold project (Newcrest 70%). Gold is currently being produced at Cracow and SED are now trading at a multiple of 8 times earnings, while exploration continues. The operation as it currently stands is far too small for Newcrest to normally have any interest in whatsoever so obviously they hold good hope of further discoveries on the site which does makes SED very interesting. But for now anyway I am still holding more than 9,000 AUM shares and am just as eagerly anticipating this anouncement as I know all of you must be.

 

[hillman]

thanks for your comment...well done!! you have been a smart player ...please say a prayer for us 'hardy' people who are developing ulcers by the second!!!!

 

[krisbarry]

It must be a lot of stress for all AUM holders, I feel your pain, I will say a few prayers

 

[aobed]

one hour to go till the end of trading today.. looks like no announcement today. Another day to wait for AUM holders

 

[Staybaker]

Also, if/when we go into pre-open, would someone be so kind as to post an updated IAP? please!

When it goes into pre-open, the IAP will be changing rapidly, second by second. I don't see much point anyone posting the IAP here because it would be immediately out of date before anyone even sees it.

Cheers, Staybaker.

 

[ALFguy]

When it goes into pre-open, the IAP will be changing rapidly, second by second. I don't see much point anyone posting the IAP here because it would be immediately out of date before anyone even sees it.

Cheers, Staybaker.

Yeah I appreciate that, but some indication of the range would be helpful I'm sure. Unless of course it's really 'all over the show'.

 

[dcart3r]

something to think about - if it turns out AUM has in fact scored a major find on the scale thus far suggested, it is very likely a big mining co. will make a bid for AUM once the find has been confirmed 100%. this will obviously put a price floor in place with the potential for a good ol' fashioned takeover bidding war between some of the big players. i imagine some of the insto brokers are just as eager to see the ann as the rest of the retail investors out there, but for quite different reasons

 

[dcart3r]

Yeah I appreciate that, but some indication of the range would be helpful I'm sure. Unless of course it's really 'all over the show'.

i have access to that information, so will try to post it provided it isn't too highly volatile

 

[greggy]

i have access to that information, so will try to post it provided it isn't too highly volatile

Still waiting for AUM to come back on. No new announcements. So sick of waiting, I bought some Sunshine Gas (SHG) this afternoon. They have 50% interest in a UK oil play to be drilled in Aug 06. The prospect contains potentially well over 500 million barrels of recoverable oil. The stock has around 22 million cash and is capitalised at 78 million. Tollhurst Noall has a spec buy on it (latest research dated 26/6/06). If they strike oil who knows where it goes. As always, do your own research before buying.

 

[crayfish]

-----------------------------

'Find of the Century'. Unquote

pfffft...anyone ever heard of Olympic Dam, Century, Cannington, Prominent Hill, Ernest Henry? These are "world-class" discoveries in the true sense.

And while there's all this Poseidon talk let's compare this AUM phenomonon with something relatively recent and relevant wrt share prices, drilling and resource announcements. I recount...

MNR discovered Prominent Hill in 2001 in JV with BHPB. The ASX announcement saw a rise in MNR share price from 0.16 to 1.60 in a day, before hitting the giddy heights of 3.00 a few weeks later upon announcement of follow up results. (Keep in mind that gold and base metal prices were quite a bit different from our current situation at the time). The reason for the spectacular increase was largely due to: 1) the geological similarity between PH and OD mineralisation, and 2) the width and grade of the intersections.

All the same the MD of MNR repeatedly said that one hole does not make a mine, and he was right - even he admitted that the 3.00 mark was breached purely due to hype.

It took MNR the best part of 3 years to drill out PH to a stage where a JORC compliant resource could be estimated...3 years for 100Mt! All this time the MNR share price yo-yoed with every drilling update. IIRC MNR released detailed sections and plans with almost every announcement...in effect anyone who knew anything about resource estimates could have done a 'back of the envelope' estimate themselves just by using the info in these announcements. By the time OXR acquired MNR, one MNR share was valued at around $2.20...not a bad return for the true believers (yes, I am happily amoungst them).

In comparison,

Here we have a situation where AUM have done exactly the opposite. A few months and 59Mt magically appears...

1. Plans and sections are garbage - no labelling of drill holes.
2. Assay results - Cu only - from just a few holes announced (their announcement mentions 106 holes). Have I missed something?
3. No tabled Co results.
4. No tabled Au results. In fact the announcement states: "Although gold has just been added to our assay mineral list it will also add an additional revenue stream to the project." Oh really? How can an estimate include gold credits with ummm, how many assays?
5. The only decriptions of geological setting come from an old CRA report:

"CRA described in “addition to the shear zone copper in realization at Double Oxide it appears that the previous drilling also intersected copper values at shallow depth some distance removed from the shear zone. CRA explained conceivable, therefore a flat layer of copper extends laterally away from the mineralized shear zone. If the layers was widespread tonnages could be significant and mining would be a simple proposition”. (Excerpt from CRA August 1992 Report)."

Could someone please translate the second sentence for me please? Is it a CRA report explaining what CRA did in the past? If the layers was??? In fact the wording and grammer is extremely poor/unprofessional throughout the entire document, to the extent that it is questionable whether anyone actually read it before its release.

Another example: "They described the “principle mineralized structure, the Double Oxide share..." Don't they mean shear?

Surely if they have drilled this out to resource satus then they would be able to give their own account of the geology...

6. AUM refer to Rocklands as an "orebody" - Ouch. A deposit yes, but an orebody it is not.

7. The biggy of them all. Non-JORC compliance. What are the geographical extents of the "orebody"? How many samples were used in the calculation? Have inter-laboratory checks been undertaken? What are their QAQC results like? What method was used for the resource calculation, Kriging? What size are their "ore-blocks"? How well do they know the surface position of their drill holes? Were downhole surveys undertaken, and if so, did they use a method that wasn't going to be effected by all the magnetite in their "orebody"? How did they calculate the SG of their samples, and ultimately, the SG of their "ore-blocks"?

Unfortunately, unless they are much more advanced on point 7 than they are letting on, then I can't see a JORC-compliant resource "just around the corner".

In addition, all "proper" mineral explration companies that I know of actually have a "proper" website oulining projects and prospects.

 

[cuttlefish]

crayfish, good post - its good to hear a frank critique of the reports they've released. In relation to the 106 drill holes that they keep bandying about I think it relates to historical drilling results they've got that were done by CRA and others years ago. They released a report in December 05 (before they started drilling) that assessed the potential resource as 49 mill tonnes of 1.6% Cu ore, but I'm not sure if they've ever provided any detailed data about those historical drill results back then or in any of the announcements they've done since - if they had it might give more of an idea of why they've come up with the resource estimates they have. Supposedly that report back in Dec was reviewed by an independant geologist.

 

[michael_selway]

Gruezi..
Just joined- hopefully I will become a regular

I bought up almost 100,000 AUM shares back in Feb on my fathers advice at an average price of $0.165. At the same time he was pushing me towards CitiGold (CTO) and I accumulated over 300,000 shares in CTO for an average price of $0.1675. CTO has been trading in the $0.30- $0.40c range for the past couple of months so by no means have I done badly there but still it would have been nice if I rather had bought a few more AUM. lol. I sold about 90% of my holding in AUM Monday last week as soon as they hit $3 and am happy I did so despite them trading as high as $10 just 2 days later. I am gernerally quite skeptical about the prospects of the so called discovery but I really don't have much of a clue. The company definitely seems to have handled itself poorly but maybe in some sense that is almost to be expected from such a junior exploration company. Hopefully and more importanly their technical skills and integrity are up to scratch. Talking to my father he seems to think, for those that missed the boat with AUM, that Sedimentary Holdings (SED) could potentially be the next AUM. They are a gold exploration company and have a 30% interest in the Cracow gold project (Newcrest 70%). Gold is currently being produced at Cracow and SED are now trading at a multiple of 8 times earnings, while exploration continues. The operation as it currently stands is far too small for Newcrest to normally have any interest in whatsoever so obviously they hold good hope of further discoveries on the site which does makes SED very interesting. But for now anyway I am still holding more than 9,000 AUM shares and am just as eagerly anticipating this anouncement as I know all of you must be.

SED not bad low fwd PE

SED - Earnings and Dividends Forecast (cents per share)
2005 2006 2007 2008
EPS -1.0 2.4 4.3 3.8
DPS -- 0.0 0.0 0.

EPS(c) PE Growth
Year Ending 30-06-06 2.4 8.3 --
Year Ending 30-06-07 4.3 4.7 79.2%

AMI chief sold at high price

Date: 13/7/2006
Author: Jamie Freed
Source: The Sydney Morning Herald --- Page: 25

Australian Mining Investments (AMI) has held its stockholders' meeting near the copper prospect it owns in Queensland. A tour of the Rocklands tenements and a name change of the company to CuDeco were also on the agenda, but after the Australian Securities & Investments Commission intervened, no vote was taken on the issuing of stock options to directors. AMI is still under pressure to release more specific information on Rocklands, after its share price rose dramatically despite experts saying the form in which the drilling results were published was unusual. Executive chair Wayne McCrae meanwhile has accused rival Exco Resources of espionage, claiming it sent geologists with global positioning system devices onto the Rocklands site. He has made a paper profit of about $A2m due to the recent stock price increase

thx

MS