Laurion Mineral Exploration Inc. V.LME

Fork In the Road

[Smitty64]

Been catching up on a ton of posts, keep myself occupied during the -8 degree weather (…just imagine the Ishkoday rn). As I’m reading, the overall consensus I’m getting is there is a fork in the road decision:
 

1. On one side, people think the Property Of Merit was done to have immediate (underlined due to the fact we could have waited a ~month to beef it up using the strong 2023 results) 3^rd party validation to prove to a VC/Private Equity company(ies) the potential of our asset. The VC/PE company would then spend the next 2-4 years drilling and injecting mass amounts of capital to develop an actual Mineral Resource Estimate and sell to a Major. The positive in this scenario is that the sale would be in the short term, and the negative is that the share price would be lower than doing the MRE on our own (I have been seeing a ”conservative” ~$2-$4 target with this stance). 

2. On the other side, people think we are going to use the findings of the Property Of Merit to raise substantial amounts of capital on our own (similar to GBR) and do the drilling ourselves over the next 2-4 years, then sell directly to a Major. This will cause dilution, but the goal here is that our diluted shares will equate to a much higher sale price than if we sell to a VC/PE in the short term. The positive in this scenario is that the share price would be much higher by doing the MRE on our own and selling direct (I have been seeing a “conservative” ~$8-$12 target with this stance).

Would love to see dialogue as to which option people prefer and if there are other options on the table.

[Smitty64]

Edit**:   Been catching up on a ton of posts, keep myself occupied during the -8 degree weather (…just imagine the Ishkoday rn). As I’m reading, the overall consensus I’m getting is there is a fork in the road decision:   On one side, people think the Property Of Merit was done to have immediate (underlined due to the fact we could have waited a ~month to beef it up

[CharlieBaba13]

I agree 100% with both scenarios.  If the $2-$4 option happens in the near future I am happy. ...I am also willing to wait 2-4 years for door number two, which I think is very realistic.  No matter where us share holders are in 2-4 years, these properties are going to prove 10mil geos whether it's LmE or another company proving it.  I'd rather it be door number two and LMe

[GoGoWings]

agree with all but da range of the immediate deal.  $2 is da high end, not da low end.

[GoGoWings]

typed positively    dats a good deal for everyone

[goldenI]

Third option: a combination of both (and a little of neither) A private equity firm does not want a mine, it wants an investment with a rate of return. I doubt many PE firms would have the experience or resources to take the Ishkoday to the next stage. Laurion have paid a retainer of 250k to USG to find a strategic transaction. Assuming the finder's fee is similar to others I have seen at 1-3

[Thebluestroy]

Honestly, it's probably going to be this. As long as we're not sitting at a sub .50 sp for the next 2 years I think more shareholders will be on board.  If a large investment is coming in to propel this to the next level then sp better climb to that $2+ range. 

[Smitty64]

Thanks for this option goldenl. Just so I am understanding correctly: You are saying that the USGC and the Advisor were brought on to felicitate a large injection of capital from a VC/PE (they would then gain a large percentage of ownership) which would give LME the financial resources to continue to drill over the next 2-4 years to develop an MRE while still maintaining majority ownership? This

[goldenI]

Thanks Smitty64,  I do. I think initially many will be disppointed with the fact that it isn't a buyout and that may cause some downward pressure on the SP, then it depends on the deal and whether it comes at a premium to the SP. People usually take a negative view of dilution, but if they communicate well I see that being a non-factor. With a cash infusion that covers a new year three

[Anthony13]

GoldenI.  I can respect your thought process but If this is a direction they would like to pruse why would  Cynthia reiterate multiple times that a disposition is the main goal of the management team.  To me this seems like quite an undertaking that will take quite a long time.  Either way something is going to happen sooner than later.  

[goldenI]

I think that this aligns with her goal. Cynthia never promised a buyout this year. She has a produced a technical report that meets the 43-101 definition of a Property of Merit for her only project. (100 pages). I think was significantly impacted by inflation and time delays over the pandemic.  I honestly have no idea what the Ishkoday is worth now. I have an idea of what's it worth

[Emeraldearl]

Finally a realistic post

[Smitty64]

Thanks again goldenI. Final question from my end:  In theory, we should then be able to determine LME’s direction (option 1, 2 or 3), in the short term. An upcoming release should announce either a massive capital injection (option 2 or 3) or a BO (option 1). Do you think they will openly release a PR stating this? Or will this be kept internally? If you think this announcement is happening,

[ahsineeg]

Smitty - here is the information you requested: May 1, 2018: Share Price $0.50 May 23, 2018: $1.7 million raised at $0.50 (non-flow-though) and $0.58 (flow-though) per share Sept 1, 2018: Share Price $1.88 Sept 11, 2018: $10 million raised at $1.45 per share Nov 1, 2018: Share Price $3.12 Nov 14, 2018: $3.5 million raised at $3.50 per share July 1, 2019: Share Price 3.96

[TraderRC]

Thank you for providing the detailed timeline Ahsineeg. I was wondering if you could outline where LME is currently in relation to the drilling in comparison to where GBR was at the time of the raising of funds.  For example, May 1, 2018, was the amount of drilling completed at $0.50 comparable to where LME is at today with a similar price. If LME has more drilling completed, where I that

[ahsineeg]

You can't fairly compare LME to GBR.  Different projects, different geologies, etc.  LME is a brownfield project....it has hosted TWO past producing mines which is a positive sign there is more gold (and base metals) in the ground...it just need to be properly defined.  Whereas GBR was discovering an entirely new (greenfield) project.  The geology is such that it is VERY

[Thebluestroy]

Well, lets hope we see the same steady growth of SP if a large capital raising event takes place this year with a ramp up in drilling.  Was GBR akin to LME in that a lions share of the holders were insiders? I think that also matters when it comes to SP.  Id like to see some real, tangible shareholder value this year if disposition truly isnt on the horizon for some time. 

[Thebluestroy]

Not a fan of dilution (especially what would be necessary to fund a super extensive drilling program) Not a fan of kicking the can down the road until 2026 either Sell it ASAP, take the $2-4 and sail off into the sunset. No matter how keen Cynthia is to keep trudging through the ishkoday, she is getting up there in age and another 2-4 years is likely too long for even her. Im sure the F&F

[JoJoHairBlo]

Nobody really knows what is in the ground, but just going by the 10M GEO's and for arguements sake, let's put a rough value of the Ishkoday at $4B. I would hope that putting 20 years of blood sweat and tears into this and laying all the difficult ground work that had to be done, Cynthia and the team would want a bit more than 15-25% of that.

[Not2smart]

I agree jojohair and to add.  Cynthia indicated over a year ago that LME is an acquisition target and I believe things are in the works.  The strike zone is larger then 6km x 2.5 km and in that 1000 pages of information we will not know exactly how many GEO are in the ground until it sells.  And to boot we have stock pile worth 25 million.  Think of what that strike zone may

[Thebluestroy]

Sure, however, Cynthia has earned an immense amount of money in that 20 years (well over 6 figures a year) and owns millions of shares that are already worth way more at current sp. All of her purchases since 2019 have been between 0.05 and 0.12 per share. Im sure a large majority of the F&F holders are well up on their preliminary investment as well.  I understand there is the

[JoJoHairBlo]

This all may be a bit of a red herring anyway.  I think it was at the AGM in 2022 that they addressed the NI-43-101.  Didn't they say that the report wasn't so much abut the data itself, but more about how the data was collected?   We might be going back and forth about numbers that don't really matter and aren't even going to figure in to the offer itself.

[Thebluestroy]

The more I think about this, the more I think we're going to see USCG / special committee bring a capital influx to expand the drilling (much like GBR).  USCG has NO experience in acquisitions even remotely close to what the ishkoday is worth even today. Most of their dealings are much smaller capital influx/advisory type deals many of which are under $100m.  Sicne the investor

[DouglasGVass]

The 43-101 technical report is a professional stamp of approval.  This is definitely a milestone for LME and proves that there are significant gold reserves accessible via a surface mine (less than 250M).  Prospective buyers are looking for the "lowest hanging fruit" when it comes to exploration properties. As I stated earlier the importance of proximity to power, water, and

[NoRealPlan]

Further to this... Earnings results for barrick et al have all spoken to increased gold prices helping earnings, but increased costs have scuttled any improvement on net profit. costs are way up... ... so LME is super sexy.

[Jimo82]

The proximity of the mine to current infrastructure must have the attention of any prospective buyer looking to acquire LME. This makes total sense for an open pit mine given the depth of the gold. That theory aligns pretty well with hiring Vikram and DRA Global to set up mining operations once the transaction is complete.