Corrado de Gasparis announced that Comstock Mining Incorporated would attend and exhibit at the American Exploration & Mining Association’s 123rd Annual Event Held at the Sparks Nugget Hotel last week.
From the obligatory press release, De Gasparis is quoted: “We are looking forward to participating in an excellent AEMA conference, where most of our industry comes together and a tremendous amount of business can take place, efficiently, right in our own backyard.”
Nothing like some huge, tremendous, efficient industry business going down right here in our own backyard. Sadly, none of it will benefit Storey County.
CMI Stock Returns to NYSE Compliance after Reverse Stock Split.
The NYSE removed the below compliance rating from CMI’s Stock after the successful completion of a 5 for 1 reverse stock split.
“We are pleased with our ongoing compliance with the NYSE American listing standards and we could not be prouder of our commitment to and collaboration with this world-class platform,” explained de Gasperis.
At the time of the reverse split, the price per share went from 13 cents per share to 65 cents per share. As of today, less than six weeks after the split, CMI shares are trading at 34 cents a share.
Today CMI Stock is trading at a pre-split value of .06
But that’s not all. Corrado de Gasparis continued, “We look forward to providing our investors with more frequent updates on our ongoing agreement for the potential joint venture with Tonogold, the monetization of our non-mining assets, and the planned development activity for the Dayton Resource Area, toward full feasibility.”
As expected, the Tonogold joint venture has produced exactly zero mining activity at the Lucerne Pit. Our sources tell us that they are in the process of mining the data relating to the drilling and other lode analysis done over the past five years to determine if they will continue with the venture. Given the grade of the ore and what it will take to get it into the gold bar smelter, we fully expect Tonoigold to come to their senses and not make the $20 million dollar payment in April.
But the flim-flammery of Tonogold is nothing compared to the flat-out lies every time they open their press release mouth.
Consider These Two Fantastic Claims Seen Every Comstock Mining Press Release:
The Company’s goal is to deliver up to $500 million of accretive share value by 2020, both through its existing mineral resource development targets and the ongoing development of the various partnerships, ventures and exploration and development activities that, all together, are capable of sustaining production equivalent to 100,000 gold ounces per annum. (Since I was 8 years old, gentle reader, my goal has always been to start in Center Field for the San Francisco Giants.)
Claim One: $500 million of accretive share value by 2020
To consider the remarkable audacity of this statement, you have to look at the data.
The chart above represents the stock price from when Goldspring took over from Plum Mining and we watched our first episode of the de Gasparis Winfield show. In looking at the first chart, we can see the stock is trading at .345 at the close of business today December 11th. There are 46.3 million shares outstanding. That is a market cap of $16.45 million dollars. The second chart above shows the stock needs to climb to $11.55 per share by December 31, 2019.
In order for CMI stock to have a $500 million share value by 2020, the stock needs to rise 2939% in 24 months. I’ll have my statue next to Willie Mays at ATT Park before that ever happens.
Claim Two: At some magical point, Comstock Mining will generate the “production equivalent to 100,000 gold ounces per annum.”
To show how absurd this nonsense is, we have to make some assumptions based on opaque or non-existent data. In looking at the 10-k reports (which you can see here), we find revenue generated from mining operations. Rather than monkey around with trying to figure out the percentage of Silver to Gold that CMI has produced (knowing that Lucerne has historically produced more Silver than Gold), let’s assume all the precious metal they have extracted is gold.
Here is a look at their revenue from mining operations to date:
With this in mind, looking at the above chart, CMI has generated $76.5 million in revenue. That’s a lot of gold. Just how much gold? We eyeballed the average price per ounce in each calendar year and came up with the chart below showing the annual production of gold in ounces:
Wow. That’s a lot of gold. However, if you pencil it out, it’s roughly 51,973 ounces of gold. Total. From 2009 to 2017. Yes, CMI has produced roughly 6,500 ounces of gold a year or about %6.5 of 100,000 ounces of gold per year.
To produce 100,000 ounces of gold per year, CMI will have to increase production by %1439 percent. I will have my own plaque in Cooperstown before that happens.
Comstock Mining pretends to be a wonderful company and an asset to the community.
It is not.
Pay no attention to the de Gasperis behind the curtain. He’s a charlatan.
As a community, we need to wake up from this bad dream and put Comstock Mining in the rear view mirror.
CMI has 12 employees. Clearly they are ready to dominate the mining industry! Maybe the County can bail them out and then offer mine tours at a loss of taxpayer dollars.
I can’t imagine there are 12 employees on the payroll. A quick investigation of a recent business license application shows Zach Spencer, owner of the Comstock Comical, starting a company called Zephyr Communications.
I’m guessing it’s because the writing is on the wall…
If they had followed through on their five year production plans I saw 5-10 years ago, we’d see something by now. But their five year plans seem to change repeatedly. And now, no production plans in sight. What happened to the American Mining and Tunneling Association? They are mining ready and have all the stuff just sitting there? There are still YouTube videos out there with the CEO Corrado talking about production–and now, not even a whisper or hint of a production date. It seems like there needs to be a CEO blog on their sight of EXACTLY why they changed their plans to zero production and are busy selling land as their primary source of income. It doesn’t help much to be debt free if you are also income free. What exactly happened and where did the production planning go? There’s definitely something we’re not seeing or privy to, but we’re not being told what that is…
Great points, Jack. I’m going to do a piece to update the situation on CMI with a piece here shortly.
I think the following data accurately displays the squandering of assets and good faith that’s happened from just a financial perspective–courtesy of http://www.stocksplithistory.com. If you invested 10,000 dollars in 2010, you’d be left with 230 dollars in 2018.
Start date: 07/27/2010
End date: 12/10/2018
Start price/share: $6.50
End price/share: $0.15
Dividends collected/share: $0.00
Total return: -97.69%
Average Annual Total Return: -36.23%
Starting investment: $10,000.00
Ending investment: $230.71