Fool me once, shame on you. Fool me twice, shame on me. 

Noble was not a successful venture on the ASX. Earlier this year on August 28th, 2019 the company was delisted from the ASX for not paying listing fees. Before then, the company had been halted on the exchange since March 17th, 2017 when the company failed to file its financial statements with the Australian securities commission. Later that fall, on October 27th, 2017 it was announced that the managing director of Noble, Miguel Palomino had resigned for personal/health reasons. On December 7th, 2017 after further investigations into the accounts of the US Entity, GPS Lab, it became apparent that up to $2.5m USD had been misappropriated from GPS Lab by Mr. Palomino.

A second important announcement as part of the LOI with Noble was that William Hayden would join MXR as a non-executive chairman upon closing of the transaction. At the time of the LOI, William Hayden was a director of Noble, however, he later resigned on January 2nd, 2019. He remains a director of Ivanhoe Mines (IVN) as well as other Canadian listed companies including Trilogy Metals (TMQ). A big name such as Mr. Hayden was the perfect catalyst for MXR and the LOI; a geologist by trade and a director of a multi-billion dollar company - a name such as Mr. Hayden lent credibility to the direction MXR was proposing with this deal.  Indeed, as shown in Figure 1 below, by early 2019 the company was touting Hayden as being involved with the company.

Figure 1: Snapshot from an archived page of the Max Resource Corp webpage showing William Hayden as a member of management. This page has since been taken down.

Fast forward 6 months and on January 9th, 2019 MXR announced that it had secured 100% of 89 mineral applications for a total area of 1,757sqkm located within the Choco Department of Colombia. 63 of the 89 applications, representing 1,270 sqkm were outside or adjacent to the Novita area, which was the subject of the proposed Noble Transaction above.

2019: MXR Resumes Trading

MXR resumed trading on January 30th, 2019. Upon coming off-halt, the company rapidly appreciated in value, beginning the morning's trading session at a share price of 0.12 CAD and ending the day with a 0.20 CAD close; a gain of 67%. What provided the catalyst for such a gain, aside from the previously announced LOI with Noble? Well, an NR was also released that day (January 30th, 2019) stating that initial exploration on one of the Noble land claims (Novita), henceforth referred to as the company's 'Choco Precious Metals Project' had identified 'free gold' from five conglomerate trial pits.

The Pit Pictures (Janaury 30th, 2019)

Figure 2: Pictures of the pit samples as provided in the January 30th, 2019 new release.

The company quickly became the focus of several retail communities including here on CEO.ca, where MXR would become one of the most followed companies at the beginning of 2019. The hype was made more credible when several well respected members of the community also provided exposure. Vince (@stateside) Marciano wrote about MXR as part of his 'stateside report' in February, 2019 and user @ayeyou provided an excellent detailed study on grade estimates for the pits using his own setup and experience with gold mining & prospecting. The company also engaged with promotional companies, beginning with 'Star Finance GmH', a company ran out of Europe by Michael Adams (click here for twitter). MXR was taking its story global, and needless to say, the market was hungry for the first assay results for these pit samples.

Pit Picture Observations

The pit pictures would continue to feature in subsequent NRs, but in an inconsistent fashion. Below in Figure 3 is an image released by the company in a NR dated February 6th, 2019.

Figure 3: Pit pictures released in a February 6th, 2019 NR.

There are several observations with this image when comparing with Figure 2 (from January 30th, 2019) - they are as follows:

1. The photo of the pit 1 sample in Figure 2 is different than in Figure 3.
2. The photo of the pit 3 sample in Figure 2 is attributed to pit 6 in Figure 3.
3. The photo of the pit 4 sample in Figure 2 appears to be the same as in pit 4 in Figure 3, except the photo has been flipped 180-degrees about the vertical axis (i.e. a mirror image).

One could argue that I am nit-picking here, but accurate and consistent messaging lends credibility to a company and their story. In my opinion inconsistencies such as these only act to revoke it. An additional inconsistency is observed by studying the images of pit 2 & 3 from Figure 2 in closer detail (attention to this was drawn on by several members of the CEO.ca community). Shown below in Figure 4 is a close-up inspection of the sample profiles from these two pits; the two profiles are very similar when overlaid. Were these two images from the same sample, but attributed to two different pits?

Figure 4: Inspection of the pit pictures from January 30th, 2019 NR. Shown are the pit pictures from the NR (top). Shown below that is a close inspection of pit samples 2 & 3 (middle) and a comparison of their shape profiles (bottom).

In my opinion the quality of these photos and its reporting is poor. It is 2019; what camera took these photos? Was it an old digital camera, an old camera phone? These photos were taken in 2019, right? Overall the use of these pit pictures was a demonstration of inconsistency on behalf of the company.

Inconsistency: The photos of the pit samples and to which pits they are attributed to change between NRs.

'Next Week'

Regardless of the aforementioned issues with the pit pictures, momentum was still very much behind MXR. In early February, 2019 the share price broke the 0.30 CAD resistance level, setting a new high for the stock. With pit assay results eagerly anticipated the company received conditional approval for the Noble transaction on February 11th, 2019 and issued a subsequent NR on February 14th, 2019 stating that the company was 'receiving the initial sampling analysis results sometime next week'. The results would never be announced...

The company discussed some elements of their sampling plan on February 24th, 2019 (see Figure 5 below):

Figure 5: The sample methodology proposed by MXR on February 14th, 2019 for the pit sampling.

Two weeks would pass, and by February 28th a further 5 NRs would be released by the company:

1. February 19th, 2019: MXR adds Colombian geology expert to the advisory board (Dr. Chris Grainger).
2. February 20th, 2019: MXR agrees to 100% sale of North Block of Gachala project to Tasca Resources (later became Universial Copper, UNV)
3. February 22nd, 2019: MXR completes geological survery over a 1,000 Sq km area of the Choco conglomerate property.
4. February 25th, 2019: MXR raises $1.1M CAD through the exercise of warrants.
5. February 27th, 2019: MXR releases LWIR survery results following survey (February 22nd, 2019).

As demonstrated above, lots of news - but no pit sample results. However, 'delays do happen' and 'results are not material until approved by the in-house Geo.', these, at the time, were all plausible reasons for the delayed results. A 1-2 week delay is nothing if you've hit the motherlode. Hype was still in abundance among investors, most notably due to the LWIR results released on February 27th, 2019 (see Figure 6 below). The red/yellow shaded areas which purportedly correlated with known, historic gold bearing conglomerate areas shot the share price from the mid 0.30s to its peak, 0.50 CAD (albeit for 15 mins or so). If visible gold was found in pits at the corner of this map; maybe MXR really had hit the jackpot. The release of the pit sample results was now more necessary than ever.

Figure 6: The LWIR results released on February 27th, 2019 by MXR.

Time passed, weeks passed - where were the pit results? Every news release became a significant event - what new information would be revealed? Every morsel was poured over with great scrutiny for any indication as to the status of the pit results. The phrase 'next week' even begun trending #nextweek alongside another favorite #theyreworkingonit. For every NR the community, either wrongly or rightly, convinced itself there must've been some greater meaning, examples included:

1. NR: The company issuing 0.60 CAD stock options to consultants (March 20th, 2019) 'The Greater Meaning': Clearly the company knows what they have on their hands - they must be confident these 0.60 CAD stock options will get exercised, right?
   
2. NR: The company & shareholders approve the Noble transaction for the Choco conglomerate property (April 3rd, 2019) 'The Greater Meaning': Ah ha - this must be why the pit results were delayed? The company can't release results from a property which is still subject to an agreement. With this approval for the agreement complete, we can get on with the pit results!
3. NR: The company engaged with Maricom for investor relations and bilingual investor access (April 10th, 2019) 'The Greater Meaning': Why would the company engage with an investor relations firm if they didn't have something good to promote? The pit results must be right around the corner!

This was surface mining, the grades, numerically, didn't need to be stellar - anything over 1 g/t would be significant. On April 16th, 2019 results finally did come, from a pit, of sorts. 'Next week' had arrived, or so most people initially thought.

April 16th, 2019 - Surface Sample Results

On April 16th, 2019 the company reported results from two pit-like samples on the Choco property which had tested positive for both gold and platinum. Unlike the majority of MXR's previous NRs, the company released this NR at 09:30 am (EST). i.e. market open on April 16th. The usual time, as is common for junior miners is 08:00 am (EST), providing 1 hours and 30 mins for the news to be absorbed before the opening bell at 09:30 (EST). As a result, the market didn't have much time to absorb these results; MXR had found gold and reported the results - at a best guess - it was time to buy.

I remember being in a coffee shop at the time these results were released. I was fixated on the price action within the first 10-30 minutes. Between 09:30 am and 10:00 am the stock climbed, bids of $100s, turned to $1000s, and then into $10,000s. The share price steadily crept out of the high 0.20 CAD range (where the share price had settled on those impatient for pit results) and into the 0.30 CAD bracket. However, by 11:00 am a peak of 0.35 CAD was beginning to decline; MXR was beginning to sell-off as the market came to a realization of what these results actually were:

1. Firstly, these were not the long sought after pit results. They were in fact surface samples from the alluvial material which rests on top of the conglomerates (see Figure 7).
   
2. Second, because of their alluvial nature (an admixture of coarse (concentrates) and fine grains (tailings)) the results reported were of concentrates. The company reported: The concentrates of sample 001 graded 340.84 g/t gold and 111.03 g/t platinum and sample 002 graded 222.06 g/t gold and 113.83 g/t platinum, both samples were located within the 1,000 sq. km exploration zone. To anyone unfamiliar with mining, the figures of >100, >300 g/t for gold or platinum are astonishing - but context is everything. Such numbers for grab samples are not uncommon, because these kinds of samples are taken over small small and are often cherry-picked. Combined, this methodology can artificially drive up the grade in units of g/t. If these were the reported grades for drill holes; wherein large lengths of drill core, representative of a general trend in geology are produced, then these would be truly bonanza-style grades. Alluvial sampling is a little more uncommon, these numbers were promising, but incomplete because only the concentrates were reported. For the full grade to be known, both the concentrates and tailings would be required.
   

Figure 7: Table of concentrate grades released by MXR on April 16th, 2019.

Likely as a result of the above reasons, the share price closed the day on April 16th, 2019 below its opening price, despite even best efforts of CEO Brett Matich in doing an interview with FTMIG. Not only were these samples not from the conglomerates, but without both concentrate and tailings grade - the total grade was unknown. And in this business, uncertainty leads to selling.

The April 16th, 2019 was an important departure point in the success of MXR in 2019. By this time, the pit results were 7 weeks overdue; and for some, 7 weeks is too long to have money tied up in a venture exchange stock. Here, another adage springs to mind:

Give them a number or give them a date, but never give both at the same time.

With pit results still missing, and now these surface results confusing the picture - the community was split on where MXR would end up next. Join me again in Part 2 of this article series as I go over the next chapter of the MXR story, involving missing presentations, suspicious & prophetic CEO.ca posts and a new property in the MXR portfolio as the company headed North while the share price headed South.

Disclosure: I have/or previously held shares in MXR. I have no affiliation with the company or CEO.ca. All opinions leveraged from this text are my own only. The accuracy/inaccuracy of any details reported here are also my own and the reader is encouraged to seek out official documentation from the company for verification of statements made in this article.