COMSTOCK MINING, INC LODE NYSE
We feel this stock is a STRONG
BUY based
upon several factors.
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Short Covering On News - Stock Has Strong Advance
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Gold Is In A Strong Uptrend
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The Company Has Reorganized Paying Off All Debt
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Several Institutional Investors Have Recently Taken
Positions SEC
13D Filings
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LODE Holds Valuable Gold Properties And Mining Assets
Fully Permitted
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LODE Owns Valuable Shovel Ready Real Estate In
Addition To Mineral Rights MORE
LODE is
building a strong base and should breakout testing the $0.50
level reached earlier this year
10 Day Chart
Unaudited Financials
VRGINIA CITY, Nev., July 31, 2018 (GLOBE NEWSWIRE) --
Comstock Mining Inc. (the “Company”) (NYSE American:LODE)
today announced selected unaudited financial results for the
fiscal quarter ended June 30, 2018.
Second Quarter 2018 Selected Strategic and Operational
Highlights
- Received $2 million
in cash proceeds for the Lucerne option agreement, in
April, advancing into the second phase of the Lucerne
Mine Project’s development with Tonogold Resources Inc.
(“Tonogold”);
- Discovered, at the
Dayton Resource, 3 feet of 0.246 opt Gold and 3.553 opt
Silver, including the identification of multiple, new,
mineralized structures;
- Retained Behre
Dolbear to produce a stand-alone, NI 43-101 technical
“Resource” report and a Preliminary Economic Assessment
technical report, both for the Dayton Resource Area;
- Advanced
screening-level, economic analysis of a pilot-processing
facility with Itronics, Inc., using their KAM-Thio
metallurgical recovery processes on Dayton material;
- Estimated annualized
additional cost reductions of $1.25 million from
Tonogold reimbursement subsidies; and
- Secured additional
water rights and property in Silver
Springs, Nevada, expanding strategic
alternatives.
Mr. De
Gasperis commented, “Last month, the U.S. Treasury
(TSRMF)
confirmed that Storey
County, NV and parts of Silver
Springs, NV, in Lyon
County, had been certified as newly created
Opportunity Zones. Shortly thereafter, the Vidler Water
Company announced the sale of 500-acre feet of water rights
in Lyon
County, Nevada to a real estate
developer for $10 million, or $20,000 per acre foot.
Additionally, a Vidler subsidiary agreed to sell over 70
acre feet of water to a developer near Reno for
$35,000 per acre foot. These incentives and comps
demonstrate how we are growing and entitling our assets in a
rapidly industrializing region and positioning them for
profitable monetization.”
Second Quarter 2018
Selected Financial Highlights
For both the three-month
and six-month periods ending June 30, 2018, every category
of cost was down as compared to the prior year period.
During the quarter ended June 30, 2018, the Company reduced
total Operating Costs (all categories) by 24%, or more than
$0.6 million, as compared to the second quarter of 2017.
These improvements include approximately $0.2 million in
reimbursements from Tonogold. The Company’s net loss
for the quarter ended June 30, 2018, was $2.4 million, or
($0.04) loss per share, as compared to net loss of $2.9
million, or ($0.08) loss per share for the comparable 2017
period.
For six-months ending June 30, 2018, the Debenture was
reduced to $8.4 million, representing an over 21% reduction
from the original debenture obligation. Cash and cash
equivalents at June 30, 2018, were $1.5 million.
Mr. De
Gasperis added, “Our cost reduction
efforts and this subsidizing partnership have allowed us to
further reduce our net spending while efficiently advancing
both of our mining projects. Tonogold is making excellent
progress on the Lucerne assessment and should have an NI
43-101, Property of Merit technical report, authored by
Behre Dolbear in the next month or so. The Company’s
efforts are now focused on advancing the Dayton project. The
new discovery and updated technical reports will confirm the
value we expect to deliver in Dayton.”
Exploration and Development - Lucerne Resource Area
The Company’s option agreement with Tonogold gives them the
right to lead engineering, development, drilling and
test-work, all towards completing a technical and economic
feasibility assessment and ultimately, to earn into a joint
venture for the future development and mining of minerals
from the Lucerne Property.
This quarter, the
Company received a $2 million payment as Tonogold elected to
advance into the second phase of the Lucerne Mine Project
option. The Company immediately used $1.5 million of the
proceeds, as required, to pay down its debenture, and then
paid down an additional $0.25 million of the debenture.
Tonogold can now earn a 51% interest in the Lucerne
Property, by advancing the exploration and development
activities by making cumulative capital expenditures of $7
million by October 3, 2019, and $20 million by April 3,
2021. Tonogold has progressed on the technical assessment of
the Lucerne Project and plans on issuing two National
Instrument 43-101 compliant reports, the first is scoped as
a “Property of Merit” report, expected imminently this
summer, and the second should represent an updated Resource
Report, also NI 43-101 compliant, later this year.
Dayton Resource Area
The Company recently exposed, sampled and revealed a newly
recognized, mineralized, cross-cutting shear zone, dominated
by black and orange ferro-manganese clays with bronze
colored bands. The Company previously reported
historic assays that identified a continuous zone of
mineralization in the Dayton of more than 205 feet with an
average grade of 0.054 ounces of gold per ton. The full
extent of the shear zone has not yet been exposed. A one
meter (approximately 3 feet) wide sample of the material was
collected and fire assayed for gold and silver. The
samples led to a new discovery of 3 feet of 0.246 opt Gold
and 3.553 opt Silver, including the identification of the
following elevated values for a number of elements:
Gold |
Silver |
Cadmium |
Lead |
Selenium |
Thallium |
Tungsten |
Zinc |
Au |
Ag |
Cd |
Pb |
Se |
Tl |
W |
Zn |
7.50 ppm |
110.5 ppm |
12.9 ppm |
46 ppm |
32 ppm |
7.8 ppm |
22 ppm |
102 ppm |
0.246 opt |
3.553 opt |
N/A |
N/A |
N/A |
N/A |
N/A |
N/A |
Previous multi-element analyses conducted in the Company’s
resource areas have typically showed very low base metal
content (typically between 10-20 ppm) and non-detectable
values of Cadmium (Cd), Selenium (Se), Thallium (Tl), and
Tungsten (W). This specific zone has a very different
geochemistry signature, with much higher values. The
Company plans additional sampling and geological mapping to
define the full extent of the shear zone.
The Company has retained
the independent mining advisory firm of Behre Dolbear to
produce a separate NI 43-101 compliant technical report for
the Dayton resource area, anticipated during the fourth
quarter of 2018, followed by a Preliminary Economic
Assessment (“PEA”). This first report will provide an
updated resource estimate and support the subsequent scope
of publishing a NI 43-101 compliant PEA for the Dayton
project.
The Company has also
been collaborating with Itronics, Inc., on Dayton
mineralized materials. Itronics previously reported
positive results from initial testing of its clean
processing technology. The leaching test results
demonstrated that the residual silver, gold, base metals,
and cyanide can be recovered from previously leached
material as well as new mineralized samples from the Dayton,
creating a potentially efficient and environmentally
attractive process. The metals were recovered while the new
KAM-Thio residual solution was substantially regenerating
during the extraction process, thereby reducing the net
consumption of the materials, and creating a potentially
compelling economic solution.
Itronics also reported that the cyanide residual in the
cyanide leached material was removed by the new leaching
process, neutralizing the solution to drinking water
standards. These results could dramatically reduce
reclamation costs and associated bonding, while adding the
prospect of alternative uses for the materials.
Operating Costs
Our cost
streamlining, primarily implemented in 2017, and continuing
through 2018, lowered operating costs in all categories by
well over $6 million, as compared to 2016, exceeding our
targets while still expanding our lands. These 2017 actions
have already realized an additional $0.6 million in savings
in 2018, that are expected to total $2 million in savings
for the full year 2018, as compared to 2017. We are lean and
positioned to grow our assets, their readiness and their
values in the latter part of 2018.
Corporate - Strategic Water Rights and Land
On May 30, 2018, and amended on June 22, 2018, the Company
entered into an agreement for the purchase of 100% of the
membership interests of Downtown Silver Springs, LLC
(“DTSS”). DTSS holds an option for the purchase of
approximately 160 acres of centrally located land in Silver
Springs, Nevada, and separately, holds an option to
purchase 350 units of water rights (equaling 392 acre-feet)
and 200 units of sewer rights.
The option to purchase the 160 acres of land allows the
Company to purchase the land for approximately $3.5 million
and expires on October 15, 2018. The option to purchase the
water and sewer rights allows the holder to purchase the
water rights for $5,800 per acre foot and the sewer rights
for $7 per sewer unit and expires on December 31, 2018.
The water rights and sewer unit usages are not restricted to
the 160-acre parcel. The Company has paid $0.8 million
toward the approximately $3.5 million purchase price for the
land.
Liquidity & Capital Resources
The Company’s shares outstanding July 25, 2018, were
57,286,428. At quarter end March 31, 2018, the Company’s
shares outstanding were 53,391,428. The proceeds from the
3,895,000 shares issued via a purchase agreement with
Leviston Resources were used to secure the strategic water
rights and land in Silver
Springs, NV. The Company also has cash
and cash equivalents of $1.5 million at June 30, 2018.
Outlook
Mr. De
Gasperis concluded, “We are aggressively
positioning both our mining and non-mining assets, including
a strategically expanded water portfolio, so that we can
maximize the value for our shareholders, either through
larger monetization of these asset packages or using the
water and other rights to strategically expand our mining
platform. We are in discussions on all of these fronts
with the expectation that we will monetize these assets so
that we are debt free, with funding, to develop and expand
our mining resources, production lives and maximize the
potential value as gold prices and markets improve.”
Conference Call
The Company will host a
conference call today, July 31, 2018, at 8:00 a.m. Pacific
Time/11:00 a.m. Eastern Time. The live call will
include a moderated Q&A, after the prepared comments by the
Company. The dial-in telephone numbers for the live
audio are as follows:
Toll Free: 1-877-260-1479
Direct: 1-334-323-0522
Confirmation Code: 6553001
The audio will be available, usually within 24 hours of the
call, on the Company website:
http://www.comstockmining.com/investors/investor-library
About Comstock Mining Inc.
Comstock Mining Inc. is a Nevada-based,
gold and silver mining company with extensive, contiguous
property in the Comstock
District and is an emerging leader in
sustainable, responsible mining. The Company began acquiring
properties in the Comstock
District in 2003. Since then, the
Company has consolidated a significant portion of the Comstock
District, amassed the single largest known repository
of historical and current geological data on the Comstock
region, secured permits, built an infrastructure and
completed its first phase of production. The Company
continues evaluating and acquiring properties inside and
outside the district expanding its footprint and exploring
all of our existing and prospective opportunities for
further exploration, development and mining. The near-term
goal of our business plan is to maximize intrinsic
stockholder value realized, per share, by continuing to
acquire mineralized and potentially mineralized properties,
exploring, developing and validating qualified resources and
reserves (proven and probable) that enable the commercial
development of our operations through extended, long-lived
mine plans and developments that are economically feasible
and socially responsible.
Forward-Looking Statements
This press release and any related calls or discussions may
include forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical
facts, are forward-looking statements. The words “believe,”
“expect,” “anticipate,” “estimate,” “project,” “plan,”
“should,” “intend,” “may,” “will,” “would,” “potential” and
similar expressions identify forward-looking statements, but
are not the exclusive means of doing so. Forward-looking
statements include statements about matters such as: future
industry market conditions; future explorations or
acquisitions; future changes in our exploration activities;
future prices and sales of, and demand for, our products;
land entitlements and uses; production capacity and
operations; operating and overhead costs; future capital
expenditures and their impact on us; operational and
management changes (including changes in the board of
directors); changes in business strategies, planning and
tactics; future employment and contributions of personnel,
including consultants; future land sales investments,
acquisitions, joint ventures, strategic alliances, business
combinations, operational, tax, financial and restructuring
initiatives; including the nature and timing and accounting
for restructuring charges, derivative liabilities and the
impact thereof; contingencies; environmental compliance and
changes in the regulatory environment; offerings,
limitations on sales or offering of equity or debt
securities; including asset sales and the redemption of the
debenture and associated costs; future working capital,
costs, revenues, business opportunities, debt levels, cash
flows, margins, earnings and growth.
These statements are based on assumptions and assessments
made by our management in light of their experience and
their perception of historical and current trends, current
conditions, possible future developments and other factors
they believe to be appropriate. Forward-looking statements
are not guarantees, representations or warranties and are
subject to risks and uncertainties, many of which are
unforeseeable and beyond our control and could cause actual
results, developments and business decisions to differ
materially from those contemplated by such forward-looking
statements. Some of those risks and uncertainties
include the risk factors set forth in this report and our
Annual Report on Form 10-K for the fiscal year ended
December 31, 2017, and the following: adverse effects of
climate changes or natural disasters; global economic and
capital market uncertainties; the speculative nature of gold
or mineral exploration, including risks of diminishing
quantities or grades of qualified resources; operational or
technical difficulties in connection with exploration or
mining activities; contests over our title to properties;
potential dilution to our stockholders from our stock
issuances, recapitalization and balance sheet restructuring
activities; potential inability to comply with applicable
government regulations or law; adoption of or changes in
legislation or regulations adversely affecting our
businesses; permitting constraints or delays; business
opportunities that may be presented to, or pursued by, us;
acquisitions, joint ventures, strategic alliances, business
combinations, asset sales, and investments that we may be
party to in the future; changes in the
United States or other monetary or
fiscal policies or regulations; interruptions in our
production capabilities due to capital constraints;
equipment failures; fluctuation of prices for gold or
certain other commodities (such as silver, zinc, cyanide,
water, diesel fuel and electricity); changes in generally
accepted accounting principles; adverse effects of terrorism
and geopolitical events; potential inability to implement
our business strategies; potential inability to grow
revenues; potential inability to attract and retain key
personnel; interruptions in delivery of critical supplies,
equipment and raw materials due to credit or other
limitations imposed by vendors; assertion of claims,
lawsuits and proceedings against us; potential inability to
satisfy debt and lease obligations; potential inability to
maintain an effective system of internal controls over
financial reporting; potential inability or failure to
timely file periodic reports with the SEC; potential
inability to list our securities on any securities exchange
or market; inability to maintain the listing of our
securities; and work stoppages or other labor difficulties.
Occurrence of such events or circumstances could have a
material adverse effect on our business, financial
condition, results of operations or cash flows or the market
price of our securities. All subsequent written and oral
forward-looking statements by or attributable to us or
persons acting on our behalf are expressly qualified in
their entirety by these factors. Except as may be required
by securities or other law, we undertake no obligation to
publicly update or revise any forward-looking statements,
whether as a result of new information, future events, or
otherwise.
Neither this press release nor any related calls or
discussions constitutes an offer to sell or the solicitation
of an offer to buy the Debenture or any other securities of
the Company.
Comstock Mining Advances the Dayton Resource Development,
Schedules 2018 Dayton NI 43-101; Discovers 3 feet of 0.246
opt Gold and 3.553 opt Silver in Crosscutting Mineralization
Comstock Presents Strategic Overview, Holds Annual Meeting,
Nominates and Elects Mr. J. Clark Gillam as Director
Q1 Results And Earnings Call Transcript - Q2 July 31
Comstock Mining Advances Strategic Mining Joint Venture and
Reduces Debt; Tonogold Completes $3 million of Additional
Investment, Advances Strategic Agreement