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Ximen Mining Corp. (TSX.V: XIM; NASDAQ: TSX.V: XIM; NASDAQ: TSX.V: XIM; NASDAQ: TSX.V: XIM; NYSE: NYSE) made its breakthrough (financial) breakthrough last week when it was announced that the budding gold producer was receiving a $ 5 non- dilutive cash injection into its ultra-high-grade Kenville underground mine launch in southern British Columbia MILLION US $ (approximately $ 6.4 million CAD) will be received once government mining permit is granted.
The delay in granting approval was the main reason for the poor stock price performance in recent months - but this is exactly the opportunity for a massive stock price increase.
At Ximen there is now a strong news flow and approval is expected in the next 7 weeks. By then, at the latest, there will probably be no stopping the share. Technically, the Ximen share is at the beginning of a strong and long-term upward trend, as the chart analysis indicates. A quick doubling of the price to the all-time high at $ 0.80 CAD (approx. 0.52 EUR) is becoming more and more likely as the technical indicators point to a new uptrend that has obviously already started.
Full version / ore from the 257 tunnel of the Kenville underground mine.
The press release ( German / English ) from Friday after the market closed makes it clear that the Kenville deposit is larger than expected. Rock samples collected near the Kenville underground mine in 2020 impressively show that high-grade gold, silver and copper are present directly on the earth's surface:
Full version / source
Full version / Ximen now controls the area around the Kenville gold mine. source
With more than 9 g / t gold, 72 g / t silver and 1.27% copper , the best results were achieved in the Venus property part. In 1900-1941, the Venus and Juno mines produced approximately 3,444 ounces of gold, 3,070 ounces of silver, and some copper and lead from just 5,411 tons of mined ore, for an average grade of 19.8 g / t gold and 17.6 g / t silver can be calculated.
Recordings from the Venus underground mine show that ore was only mined sporadically and that more ore is available for mining using modern underground mining methods:
Full version / cross section through the historical Venus underground mine. source
Approximately 1 km east of the Kenville Underground Mine is the Oro Fino property, where quartz-gold mineralization similar to that of Kenville has been discovered. This suggests that the Kenville mineralization continues into the Oro Fino property and is much larger than previously thought.
Full version / quartz vein ore fragments directly on the earth's surface at Oro Fino . source
Approximately 1.5 km southwest of the Kenville underground mine is the Josie property portion where a 10 m wide vein of quartz was discovered: records show extremely high grade gold (15 g / t), silver (240 g / t) silver and copper ( 5%) . Ximen was able to find another vein directly on the earth's surface with 1.76 g / t gold, 41 g / t silver and 1.01% copper :
Full version / Newly discovered quartz vein directly on the surface of the earth in the Josie property part. source
About 3.8 km south of the Kenville Underground Mine , Ximen was able to find a quartz vein enriched at 3.99 g / t gold on the Pingree property portion .
Conclusion & outlook
Die Laborergebnisse von 9 weiteren Gesteinsproben stehen noch aus und sollten in Krze eintreffen bzw. verffentlicht werden. Die bisherigen Ergebnisse besttigen, dass rund um die Kenville-Untergrundmine noch viel mehr Gold, Silber und Kupfer vorkommt, als bisher vermutet.
It was therefore a logical step for the Ximen management to acquire additional properties around the Kenville mine over the past few months. For financiers and strategic partners it is immensely important that a prospective gold producer not only owns a promising mine, but controls the entire area. Because once production begins, on the one hand more explorers will be drawn to the area and, on the other hand, a manufacturing company must think long-term and have ore replenishment options at an early stage. Only then does a prospective producer also become a takeover candidate for large gold mining companies and / or attractive for strategic partners / financiers such as the Swiss metal trading company, which provides funds of approximately $ 6.4 million CAD (non-dilutive;refundable in gold after start of production).
With only 72 million shares currently on the market, Ximen as a prospective gold producer has an extremely tight share structure - and the stock market valuation is only 17 million EUR. The $ 5 million USD loan must be repaid with around 3,000 ounces of gold . Ximen announced last week that the funds would be used, among other things, to mine a 10,000 t bulk sample and build the new tunnel in the Kenville underground gold mine.
Assuming a conservative gold content of half an ounce of gold or 15.6 g / t, the upcoming 10,000 t bulk sample would contain around 5,000 ounces of gold ( thanks to high recovery rates of up to 99% ) with a current sales value of around $ 11, 7 million CAD . After deducting the loan repayment (in gold), around $ 5 million CAD would remain in the cash register. A great deal for the company and for us shareholders!
As soon as the approval has been received ("within 8 weeks", according to the news last week), the loan will be paid out and the bulk sample can be dismantled immediately, thereby making money. After an initial 10,000 t bulk sample, Ximen could apply for a 50,000 t bulk sample , from which around 25,000 ounces of gold can be extracted (current sales value around $ 60 million CAD ). For a long time I can no longer imagine the Ximen share at such a low price level and would not be surprised by a strong upward trend from today with a new all-time high in a few weeks.
Chris Anderson, President and CEO of Ximen, commented on today's news: "This non-dilutive financing is an important milestone in the development of the Kenville goldmine into production. After months of negotiations, we are delighted to be able to partner with an experienced A company that understands our industry and that allows us to take the final step towards meeting our cash flow needs. "
During the past few months, Ximen has not only increased its fleet of vehicles for the Kenville mine start and brought it into shape (so that mining can begin immediately after the approval has been granted), but has also diligently repaired the "257" tunnel entrance of the formerly producing Kenville underground mine, All official requirements met and applications with detailed documentation submitted for a mine start.
All that was missing was the approval of the mining authority. It turned out that due to COVID-19, faster processing of the Ximen applications was not possible. So there were annoying delays that made themselves felt with a falling Ximen share price. The Ximen share has lost around 55% of its value since summer 2020 and is therefore listed at a relatively cheap level - a long-term price increase over the next few weeks should follow from today, because:
As it became known last week, the approval should be given in the next 8 weeks. Such a large amount of funding as last week should also convince the authorities that Ximen is also financially well positioned to reliably turn its production plans into reality. Only local workers from the neighboring city of Nelson are to be employed for the mine operation, as the news incidentally noted. This is putting significant pressure on the authorities to create new jobs and allow a significant flow of money into local communities.
The success of the modernization work at the Kenville Mine Portal provides convenient access to the existing 257 adit to mine the high grade gold resources identified by drilling in 2009. In total there are still 373,238 ounces of gold ready to be mined, which at the current gold price have a sales value of $ 875 million CAD :
With an average of 22.9 g / t gold is this allows an exceptionally high degree of resource that very high profit margins. This has become very rare worldwide, as most underground mines have much lower gold grades. In addition, last year Ximen confirmed with tests that the gold recovery rate is 99%. This means that almost all of the gold can be extracted from the rock, with Ximen conservatively using a mixture of high and low grade ore with a conservative average grade of 17.1 g / t gold . Not even the 5 highest grade underground gold mines in the world have such a high recovery rate:
Source: Mining.com / Gold recovery rates are from company reports ( here , here , here , here , here )
New tunnel construction
The 373,238 ounces of gold that can be mined with the 257 adit are by no means all that is in Kenville. With the construction of a new tunnel, Ximen wants to mine additional gold deposits. Ximen is secretly planning to mine gold from 2 tunnels at the same time in order to inspire shareholders with growth prospects after the start of production of the 257 tunnels.
The resources listed above are based solely on drilling in the 257 adit in 2009, which has been followed by further drilling programs to discover new gold veins at depth to the west and south of the existing adits. These "new" resources, most of which have already been confirmed with drilling, are to be mined with a new gallery that has yet to be built and will be several hundred meters long to reach these deposits. However, there should also be gold-rich zones on the way there, which can be mined with large samples during the tunnel construction and converted into cash.
The following graphic shows how easily the 2009 resource can be mined with the existing 257 tunnel and how the new tunnel to be built ("new decline") will remove the new gold deposits in the west (" New Target West Area ") and south (" New Target South Area ") is to reduce:
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The past few months have been difficult times for Ximen shareholders as regulatory approval has been delayed and news of the Kenville gold mine has stopped. British Columbia was one of the hardest-hit provinces in Canada by COVID-19 restrictions. There were major delays at rock analysis laboratories and mining authorities. The situation seems to have improved noticeably, however, because Ximen is expecting approval in the next 8 weeks. Since Ximen is able to state a tight time frame for the expected approval to be granted, this indicates a confirmation from the authority.
The $ 5 million non-dilutive loan enables Ximen to get a substantial amount of cash on favorable terms in one fell swoop that is needed to accelerate Kenville production even faster.
With a current market valuation of just $ 29 million CAD and only 72 million shares outstanding, it's rare to find a budding gold producer as cheap as Ximen. The time is now (over) ripe to really go full throttle. This should now be reflected in a sustained rise in the share price, as official approval is only a (short) question of time.
From a technical point of view, the Ximen share is at the beginning of a new upward trend, as the consolidation within the (green) triangle formation has been completed and the dissolution movement out of the triangle (so-called thrust) has already started and, by definition, aims at the resistant triangular high (> $ 1.10 CAD) into a new support so that another upward trend can start. A massive share price increase is expected for the coming weeks