• Symbol: MGG: TSX Venture Exchange
  • Shares Issued: 237,482,662
  • Options: 8,020,000
  • Warrants: 53,592,500
  • Fully Diluted: 299,095,162
  • High Net Worth Private Investors ~55%
  • Precious Metals Funds ~20%
  • Retail ~15%
  • Management ~10%

All of Minaurum’s projects are located in Mexico:

1) Aurena and Santa Marta

These two projects are located in the Oaxaca-Chiapas Region, southeast of Mexico City.

Aurena is a gold skarn discovery that appears to be on hold, i.e., the grades are nothing special and the drill results are stale, i.e., done in 2011. Minaurum is looking for someone to do a joint venture on the property. Let’s just say it isn’t worth too much.

Santa Marta is a 7,310 hectare gold-copper (VMS) project in Oaxaca State, south of Mexico City. The property was optioned it at one time in late 2013/early 2014 by J. David Lowell’s company, Lowell Copper Ltd. However, due to low copper prices, Lowell Copper gave up its option and returned the project to Minaurum. However, it is worth noting the David Lowell opted to keep the 7.5 million shares of MGG, since he still considers Santa Marta a valuable asset that needs to be drilled. Minaurum is presently working to secure drilling permits. With the rebound in copper prices, perhaps Minaurum will be able to JV the project, or eventually do some drilling to prove up the potential of the property. Certainly it is a valuable asset waiting to be monetized.

2) Adelita and Alamos

Located in Southern Sonora State, the Adelita project is a copper-gold-silver skarn mineralization and porphyry discovery. Drilling has demonstrated 300m of vertical continuity on the Cerro Grande skarn target discovery with the porphyry target still undrilled. Seven target areas have been identified. Pan American Silver operates the Alamo Dorado Mine just 6 km to the west of Adelita. The silver grades 62 g/t at Alamo and the only drill holes at Adelita show similar grades, so Adelita might have potential. Minaurum is looking to JV the property.

The Alamos silver project is currently the main focus of Minaurum’s management. The best explanation of what Alamos is all about is to be found in the video below where Dr. Peter Megaw explains the potential of Alamos—in short, the hunt is on, using more modern exploration techniques, to find rich, high grade veins in a district scale operation.

https://www.youtube.com/watch?v=zZz4JdkhaMs&feature=youtu.be

Minaurum is currently conducting a 5,000-meter drill program at Alamos—it started on August 3rd and is targeting seven vein structures. Once those targets are drilled, the company intends to drill some additional targets in the piano-key style areas that Dr. Megaw mentions in his video. It would be well worth one's time to read the press release re the start of drilling.

Certainly Alamos is the key to near-term stock movement — a couple of good width holes with high grades could get a lot of investors excited.

3) Vuelcos del Destino and Biricu – State of Guerrero

“Vuelcos del Destino is the largest single untested gold skarn target intrusive complex measuring 12 sq. km, located on the southeastern portion of the 31 million ounce Guerrero Gold Belt ("GGB"). Vuelcos is only 20 kilometers from Gold Corp's Los Filos mine (16.27 Moz gold), which was recently purchased by Leagold Mining, backed by mining promoter and billionaire Frank Giustra, and Endeavour Mining founder Neil Woodyer.” — From Minaurum’s website.

To get a good picture of what Vuelcos is about, it would be best to listen to this video by David Jones, the geologist who probably knows the Guerrero Gold Belt as well as anyone. After listening to that video you may wonder why Minaurum hasn’t explored it yet; after all the GBB is home to many multi-million ounce gold deposits, so why hasn’t it been explored? The simple answer, of course, is that Minaurum has never had enough cash to do the large scale drilling needed to prove up a resource. On the other hand, David Jones, knows what he may have there, so why give it away by doing a JV, unless you get a partner willing not only to spend big dollars, but also able to pay Minaurum fairly and to cut them a good deal.

Note that Vuelcos is federally permitted and drill ready.

So, might Alamos be the stepping-stone to raising a lot of funds that would enable them to drill Vuelcos? Yes, a rhetorical question. And might Minaurum find a valuable JV partner? Let’s hope that Leagold becomes interested over time. What might whet Leagold’s interest in Vuelcos? Read on re Biricu.

Biricu is listed on Minaurum’s website, but there’s no content posted yet. Wonder why? It all started with a press release on November 4, 2015, where Minaurum agreed to lend $770,000 to Guerrero Ventures, Inc. (GV.v) via a demand loan that gives Minaurum the right to convert the loan into a 55% interest in Guerrero’s Biricu Project, subject to certain conditions. And Minaurum can earn another 20% by providing an additional $153,000 funding to be used within 24 months for exploration on the project. So for less that $1 million, Minaurum gets 75% of the Biricu Project.

So, just what is Guerrero Ventures’ Biricu Project? From the GV website:

The Biricu Property is in close proximity to several operating gold mines and significant gold discoveries, including:

  • El Limon-Los Guajes owned by Torex Gold (TSX:TXG)
  • Bermejal, Los Filos and Nukay owned by Goldcorp (TSX:G) [Now owned by Leagold]
  • Ana Paula controlled by Newstrike Capital (TSX-V:NES)

Mineralization in the GGB was first discovered in 1924 and inventories have continued to grow since. The Biricu Property contains identical reactive carbonate and sandstone host rocks as known deposits in the region. Moreover, intrusive rock types identified are identical to those seen in Goldcorp’s Los Filos Project deposits as well as in Torex Gold’s El Limon deposits.

A reconnaissance exploration work program commenced in mid-February 2012, under the direction of David Jones, a leading GGB geologist and a technical consultant to Guerrero. Exploration activities to date have focused in the northern half of the property in target areas such as Punto Rojo, Hornfels Hill and Eastern Ridge. Work completed to date over the property includes geological mapping and prospecting, 298 rock samples, 187 stream sediment samples and 390 soil samples. In addition, a VTEM airborne magnetic and electromagnetic survey of 1,403 line kilometers was completed in September 2012. A follow-up airborne gradiometer magnetic survey of 2,052 line kilometers was completed in December 2014. An initial diamond drill program of 5,300 meters was completed in December 2014.

Now if you read that carefully, perhaps you noted that David Jones (he of Los Filos fame and a member of Minaurum’s BOD) was the technical consultant to Guerrero Ventures? What the website did not say is that the Biricu Project landholding is immediately next door to Los Filos and to Minaurum’s Vuelcos del Destino landholdings.

Let’s do some simple math: GV’s Biricu landholdings are 41,000 hectares and Minaurum’s Vuelcos landholdings are 8,831 hectares. Combined that would be 49,831 hectares, or 498 square kilometers. Leagold's Los Filos property, including Bermejal, is 10,433 hectares, or 104 square kilometers.

Why do I combine the two landholdings? The answer lies in the SEDAR filings of MGG and GV. The facts are 1) that GV has about $5,000 cash on hand, but $621,000 of current liabilities, 2) Minaurum can demand payment on the loan at any time, and 3) the current loan due to MGG stands at $999,880 including accrued interest.

This information is from GV’s latest filing on SEDAR:

  • As at December 31, 2016 and March 31, 2017, Minaurum advanced a total of $905,000 under the loan agreement. Minaurum has also incurred an additional $313,081 in exploration expenditures on the Biricu Property as at December 31, 2016 and March 31, 2017. Minaurum has not demanded repayment of the loan.
  • In June 2016, the Company and Minaurum entered into an amendment to the loan agreement whereby the Company can by notice in writing to either: i. fund its share (which is deemed to be 25%) of the exploration expenditures incurred on the property by paying to Minaurum $73,770 in cash; or ii. not fund its share of the exploration expenditures and dilute its interest in the property to 23.06%.

Cutting to the chase, it is obvious that Minaurum will be taking over the Biricu Project from Guerrero Ventures. Combining the two properties will give Minaurum one of the largest landholdings in the Guerrero Gold Belt and will just beg to be thoroughly explored now that Leagold is on the scene.The combined lands now abut Leagold’s Los Filos and El Bermejal properties and put Minaurum gold in great company — notice the nearby players and their mines? I’m sure David Jones is rubbing his hands together and can’t wait to see the drills turning.

Investment Thesis:

  • Strong management team led by CEO Darrell Rader, including Dr. Peter Megaw and David Jones on the Board of Directors
  • Closely-held shares with a strong European base of investors (55%), good ownership by management (10%), a few funds (20%) and the remainder held by retail
  • Adequate funds on hand, approximately $5 million
  • Drill program in progress at the Alamos Silver Project—could yield some nice results and movement in the share price; results are expected at the end of September
  • Minaurum’s GBB landholdings hold the real future value of the company, in my opinion. At the moment the GBB values are largely being ignored by investors, except for long-term shareholders; that should change as MGG unlocks the value in Alamos and then uses the proceeds to drill in Vuelcos del Destino and Biricu.

Note: I am long Minaurum Gold. $MGG