The Speculative Investor


Almaden Minerals (NYSE: AAU, TSX: AMM) [Shares: 120M issued, 149M fully diluted at 24 Jul 20]
Date / Location of update	Comments
28th December 2020, Weekly Update (Stock price: US$0.49)	Almaden Minerals (AAU) advised that Mexico's federal permitting authority, Secretaria de Medio Ambiente y Recursos Naturales (SEMARNAT), has rejected the company's environmental permit application (MIA) for the Ixtaca gold-silver project. SEMARNAT did not want to make a decision regarding the Ixtaca MIA until a court case that was preventing the project from proceeding had been resolved. However, AAU's management pushed for a decision on the MIA on the basis that the court case and the MIA were unrelated issues. With the benefit of hindsight it is clear that this was a mistake (everything is always clear in hindsight). By forcing SEMARNAT to make a decision while the project was embroiled in a controversial legal matter with potential country-wide significance, AAU's management increased the probability that the MIA decision would be negative regardless of the Ixtaca project's environmental merits. This is not the end of the story for AAU's Ixtaca project, as the company should be able to address SEMARNAT's concerns and resubmit the MIA. However, last week's news implies that even in a best-case scenario the project could be years away from receiving the permits required to begin mine construction. Last week's news caused the stock price to plunge to around US$0.50, which is roughly where it was the last time we highlighted the stock as a buy. In the intervening period it traded as high as US$1.20. We thought that AAU was a buy near its current level about five months ago, but due to the adverse change in company-specific fundamentals stemming from last week's news we currently view the stock as either a hold or a sell. We have removed the long-term AAU position from the TSI List. In the seven years that we followed the stock there were numerous buying and selling opportunities, but based on the 2013 entry level and last Friday's closing price the result was a large loss (about 77%). We also have removed Almadex Minerals (DEX.V) from the Small Stocks Watch List, since DEX's main asset is a royalty associated with the Ixtaca project. Note that if the gold sector's multi-year upward trend resumes as expected within the next few weeks then a better selling opportunity for AAU probably will emerge during the first half of next year. However, development-stage gold stocks that don't have major permitting obstacles should, on average, perform better than AAU during the next sector-wide rally.
7th December 2020, Weekly Update (Stock price: US$0.78)	Almaden Minerals (AAU) suffered a legal defeat in a Mexican court last week. In effect, AAU is being forced to own mineral rights that it doesn't want to own and that have no bearing on its Ixtaca gold-silver project, seemingly with the intention of involving the company in a case against the Government of Mexico that aims to reform the current system of mining concessions. This legal issue is preventing AAU from obtaining the permits needed to begin mine construction at the Ixtaca project, but it could end up hindering many other mining companies operating in Mexico. Last week's court decision does not affect AAU's ownership of the Ixtaca gold-silver project. Its main consequence is that AAU will remain embroiled -- through no fault of its own -- in a larger legal case against the Government of Mexico, and as a result there is no telling when the company will be able to obtain the permits required to move the Ixtaca project into the construction phase. From our perspective, this means that AAU will be a candidate for new buying on extreme weakness only.
9th November 2020, Weekly Update (Stock price: US$1.21)	Almaden Minerals (AAU) published its financial statements for the September-2020 quarter. They show that the company had C$4.1M of working capital and C$2.9M of long-term debt (owed to its affiliate company Almadex Minerals) at 30th September. The company began the quarter with C$2.5M of working capital and completed a C$2M equity financing in July, so cash consumption during the quarter was $400K. The current working capital should be enough to fund the business for at least another two quarters, but a lot still depends on what happens with the lawsuit that is preventing AAU from receiving the environmental permit for the Ixtaca gold-silver project in Mexico. Resolving this issue was delayed by the Mexican government's response to the COVID-19 pandemic and at this stage the timing of a resolution is unknown. Despite the legal obstacle that remains in the way of AAU's flagship project, the following daily chart shows that the stock has done very well in both absolute and relative terms over the past two months. The chart shows that last week AAU made a 2-year high in dollar terms and a 20-month high relative to GDXJ. This could be due to anticipation of a favourable legal resolution, but it also could be due to recommendations from other newsletter writers. At current metal prices, fair value for AAU would be well above US$2.00 if not for the above-mentioned legal obstacle.
21st September 2020, Weekly Update (Stock price: US$0.95)	Almaden Minerals (AAU) advised that while it awaits the outcome of its permitting application and related legal issues, it will resume exploration at the Ixtaca gold-silver project in Mexico with a focus on some previously identified high-potential targets that lie outside the currently defined reserve envelope. This paves the way for some positive news over the months ahead, but obviously the key to generating shareholder value is the removal of the legal obstacle that continues to prevent the project from moving forward. Also, AAU reminded the market that based on the FS completed about two years ago, the Ixtaca project is estimated to have an after-tax IRR of 57% and NPV(5%) of US$466M at gold and silver prices that are almost 30% below current prices (US$1425 for gold, US$20.00 for silver). With 120M shares outstanding, the aforementioned NPV is about US$3.90/share. Even if we discount this amount by 50% to account for the risk posed by the legal issues, AAU, which has doubled since we highlighted it as a buy two months ago, could double again from here with no change in metal prices.
14th September 2020, Weekly Update (Stock price: US$0.77)	Almaden Minerals (AAU) had a legal victory last week. In October-2019 Mexico's environmental authority (SEMARNAT) suspended its review of the environmental permit application (MIA) for AAU's Ixtaca gold-silver project until the resolution of legal proceedings regarding the Company's mineral concessions that encompass the area of the Ixtaca project. Last week the second district court in Puebla State notified SEMARNAT that the legal proceedings should not prevent it from resolving the MIA permit application. Although this is positive news for AAU, it doesn't have great significance since SEMARNAT's decision to postpone the MIA is not the main issue. Regardless of whether or not SEMARNAT approves the MIA the project cannot proceed until the legal proceedings regarding the mineral concessions are resolved in AAU's favour. We expect that AAU eventually will prevail in the courts, but the timing remains unknown.
10th August 2020, Weekly Update (Stock price: US$0.72)	Almaden Minerals (AAU) published its financial statements for the June-2020 quarter. They show that the company had C$2.5M of working capital at 30th June. Accounting for spending that has occurred and a C$2M equity financing that was announced since quarter-end, the company probably now has about C$4M of working capital. This should be enough to fund the business for another 2-3 quarters. AAU's primary focus continues to be the lawsuit that is preventing it from receiving the environmental permit for the Ixtaca gold-silver project in Mexico. Resolving this issue has been delayed by the Mexican government's response to the COVID-19 pandemic. Despite the stock being dirt cheap, our view since late last year generally has been that it won't make sense to undertake new buying of AAU shares until the above-mentioned legal obstacle is removed. That being said, we did highlight the stock as a candidate for new buying in both the 13th July and 20th July Weekly Updates when it was trading at around US$0.50. Over the ensuing 2-3 weeks it traded as high as US$0.84, so that suggestion worked well.
27th July 2020, Weekly Update (Stock price: US$0.58)	Almaden Minerals (AAU) announced a small equity financing last week. The company will be raising about C$2M by issuing new shares at C$0.65. With this financing we estimate that the company will have about C$3.5M, which at the current rate of spending should be enough to fund the business for about three quarters.
18th May 2020, Weekly Update (Stock price: US$0.43)	Almaden Minerals (AAU) published its financial statements for the March-2020 quarter. They show that the company had C$2.6M of working capital at 31st March, which, accounting for a C$2M equity financing, means that the company consumed about C$1.1M of cash during the quarter. AAU should have sufficient cash to fund itself for another couple of quarters. AAU's primary focus is the lawsuit that is preventing it from receiving the environmental permit for the Ixtaca gold-silver project in Mexico. The stock was dirt cheap 6 months ago and is even cheaper today due to the rise in the gold price, but it won't make sense to undertake new buying of the shares until the above-mentioned legal obstacle is removed. There is no telling how much longer this will take.
30th March 2020, Weekly Update (Stock price: US$0.30)	Almaden Minerals (AAU) published its financial statements for the December-2019 quarter. They show that the company had C$1.7M of working capital at 31st December, which is C$1.2M less than it had at the end of the preceding quarter. Subsequent to quarter end the company announced an equity financing that will add about C$2M to its treasury, so AAU should have sufficient cash to fund itself for another couple of quarters. AAU's primary focus is the lawsuit that is preventing it from receiving the environmental permit for the Ixtaca gold-silver project. There is no telling how much longer it will take to remove this legal obstacle. The stock is dirt cheap, but it probably won't make sense to undertake new buying of the shares until the above-mentioned legal obstacle is removed.
16th March 2020, Weekly Update (Stock price: US$0.28)	Almaden Minerals (AAU) announced a small equity financing last week. The company will be raising about C$2M by issuing new shares at C$0.41. The timing of this financing is unfortunate, but for risk management purposes it probably makes sense.
2nd March 2020, Weekly Update (Stock price: US$0.35)	Almaden Minerals (AAU) issued a press release last Thursday that provided a lot more information about the legal issue that has caused the environmental permitting process to be suspended at its Ixtaca gold-silver project in Mexico. It's a complicated story beginning in 2015 when an "Amparo" (a legal request for protection of rights in Mexico) was filed on behalf of a community (the "Ejido") that owns a small portion of the land associated with the original Ixtaca project mining concessions. Since this small portion of AAU's original concessions wasn't required for the Ixtaca project, AAU divided the original concessions into new/smaller concessions and then cancelled the concessions that overlapped the Ejido land. However, the cancellation was successfully challenged by whoever is representing the Ejido and so the Amparo remains in place. In effect, AAU is being forced to maintain ownership of mineral claims it does not want/need and has formally dropped. In October 2019 AAU was notified by SEMARNAT, Mexico's environmental authority, that the permitting process for the Ixtaca Project (called "MIA") had been suspended pending resolution of the Amparo. AAU then filed a formal request to SEMARNAT to revisit its decision on the basis that SEMARNAT's authority is limited to the regulation of environmental matters, that SEMARNAT is not a party to the Amparo, and that SEMARNAT has no legal basis to link its administrative review of the MIA to the Amparo. Discussions between AAU and SEMARNAT are on-going. We expect that the legal issues eventually will be resolved and that AAU will receive the permits required to move the Ixtaca project into the construction phase, but we have no idea when.
17th February 2020, Weekly Update (Stock price: US$0.45)	AAU is focused on the Ixtaca gold-silver project in Puebla State, Mexico. According to the FS completed in December-2018, at gold and silver prices of $1275/oz and $17/oz, resp., the project could be developed into a mine with an after-tax NPV(5%) of US$310M and an after-tax IRR of 42%. The cost to build the mine is estimated to be about US$170M. Based on the economics estimated in the FS, we think that AAU would be worth US$1.50-$2.00 today (3-4 times the current stock price) if the Ixtaca project was fully permitted. Therein lies the rub, because the permitting process has stalled due to a legal challenge. We think that the legal challenge eventually will be resolved, enabling AAU to obtain its environmental permit. However, we don't know when that will happen and in the meantime the stock will be 'dead money'. We will retain AAU, but we don't think it will be a good candidate for new buying until after the legal obstacle is removed.
18th November 2019, Weekly Update (Stock price: US$0.52)	Almaden Minerals (AAU) published its financial statements for the September-2019 quarter. They show that the company had C$2.9M of working capital at 30th September, which is C$1.1M less than it had at the end of the preceding quarter. AAU's primary focus is now the lawsuit that is preventing the company from receiving the environmental permit for the Ixtaca gold-silver project. It isn't known how long it will take to remove this legal obstacle.
30th October 2019, Interim Update (Stock price: US$0.54)	Environmental permitting has been the biggest risk facing AAU's Ixtaca project (Puebla State, Mexico) for a considerable time. Based on this week's news, that's clearly still the case. After the close of trading on Tuesday 29th October AAU advised that the permitting process for the Ixtaca project has been suspended by SEMARNAT, Mexico's environmental authority, pending resolution of the mineral title lawsuit reported by AAU in April of this year. The complainant in the lawsuit is a community of about 150 people, and the purpose of the suspension is "to protect the complainant's agrarian rights and lands, in order that the complainant is not affected by the mining concessions or possible mining activities." The AAU stock price fell 14% on Wednesday 30th October in reaction to this news. SEMARNAT's decision to suspend the Ixtaca permitting process makes no sense, because a) the aforementioned community is located well outside of the Ixtaca project impact area, b) AAU abandoned its mineral claims in the area of the complainant in 2017, and c) AAU has no interest in holding any mineral claims in the area related to the lawsuit. However, nonsensical decisions are not unusual when dealing with government departments. AAU probably will resolve this issue, but it almost certainly means that the environmental permit will be delayed. Prior to this news the permit was expected before the end of this year. Now there is no way to estimate when it will happen. On a risk/reward basis AAU is still an intermediate-term buy, but as a result of this week's news the risk has increased. Also, the delay in permitting means a delay in the timing of an eventual takeover of the company.
16th September 2019, Weekly Update (Stock price: US$0.71)	Almaden Minerals (AAU) advised that the environmental permit application (Manifestacion de Impacto Ambiental, or "MIA") for its Ixtaca gold-silver project (Puebla State, Mexico) was progressing. Recently the company submitted answers to formal questions posed by the environmental authority, SEMARNAT, as part of the standard MIA review process. AAU also advised that Dr. John Thomas has been appointed to the position of vice-president of project development. In this role and contingent upon permitting and project financing, he will be responsible for pre-development engineering and construction of the Ixtaca project. It's important that AAU's management proceed as if the company is going to move the project through to production, but the most likely and desirable end game for AAU is a takeover by a larger gold or silver mining company. We expect that receipt of the environmental permit, which is expected during the final quarter of this year, will pave the way for a takeover bid.
12th August 2019, Weekly Update (Stock price: US$0.77)	Almaden Minerals (AAU) published its financial statements for the June-2019 quarter. They show that the company had about C$4M of working capital at 30th June, which is about C$1M more than it had at the end of the preceding quarter. The increase was due to a gold loan from its sister company Almadex Minerals (DEX.V). The value of the loaned gold was C$2.9M at 30th June, so AAU consumed about C$1.9M of cash during the latest quarter. We continue to expect that AAU will attract a takeover bid soon after completion of the Ixtaca project's environmental permitting. According to the company's latest MD&A, the main environmental permit probably will be issued during the final quarter of this year.
24th July 2019, Interim Update (Stock price: US$0.78)	Although there have been signs of increasing speculation over the past week, there are still quite a few junior gold mining stocks with good projects that are yet to respond in a meaningful way to the gold rally. Also, in some cases even the ones that have achieved large percentage gains from their May-June lows appear to be at depressed levels when looking beyond the short-term. For example, the following chart covering the past 6 months suggests that Almaden Minerals (AAU) is stretched to the upside, with the stock price having gained 85% since its late-May bottom. However, if we step back and look at a chart covering AAU's performance over the past 5 years (see below) a very different picture emerges. The longer-term chart shows that the stock's recent surge began soon after a break below long-term support (as some of the best rallies do) and suggests that the rally might be still in its infancy.
20th May 2019, Weekly Update (Stock price: US$0.47)	Almaden Minerals (AAU) published its financial statements for the March-2019 quarter. They show that the company had about C$3M of working capital at 31st March, which is about C$1M less than it had at the end of the preceding quarter. This indicates that the rate of spending has dropped considerably now that the Ixtaca project's environmental permitting submission and engineering are complete. AAU has arranged to top up its treasury via a small (around US$2M at the current gold price) financing in the form of a gold loan from associated company Almadex (DEX.V). Specifically, Almadex has agreed to loan up to 1,597 ounces of gold to Almaden at an annual interest rate of 10%. The loan can be drawn in tranches as needed. We usually don't like it when companies with management in common provide financial support to each other, but in this case the arrangement makes commercial sense for both companies. This is because the Ixtaca project is the most important asset for both companies (DEX's most valuable asset is its 2% Ixtaca NSR royalty). Also, the gold loan from DEX reduces the dilution risk for AAU shareholders and enables DEX to generate some income from what was a dormant financial asset. We continue to expect that AAU will receive a takeover bid soon after completion of the Ixtaca project's environmental permitting.
22nd April 2019, Weekly Update (Stock price: US$0.55)	Almaden Minerals (AAU) advised that "a lower court in Puebla State [the state in which AAU's Ixtaca project is located] has ruled that Mexico's mineral title system is unconstitutional because consultation is not required before the granting of mineral title. The lawsuit was filed against the Mexican government regarding claims originally held by Almaden which covered a large area including the Ixtaca deposit." This doesn't appear to be a significant company-specific risk, because the claims associated with the lawsuit were already cancelled by the company and AAU's current claims covering the Ixtaca deposit are not the subject of this court decision. Similar lawsuits are underway throughout Mexico, so this news could be a sign that the risk of developing a mine in Mexico is on the rise. However, at this time we don't perceive it to be important.
25th March 2019, Weekly Update (Stock price: US$0.60)	Almaden Minerals (AAU) advised that it has submitted its environmental permit application, or Manifestacion de Impacto Ambiental (MIA), for the Ixtaca gold-silver project to Mexican authorities. Here are some of the important aspects of the MIA: - The mine plan avoids existing local domestic water sources and includes a new water storage reservoir that could add more than 2,000 m3 per day of water supply for community use. - The mine plan includes a dry-stack tailings facility that would include co-disposal of waste with filtered tailings, use much less water than traditional slurry facilities, reduce the mine footprint, allow for better dust control, and enable earlier rehabilitation of the tailings and waste rock disposal areas. - The mine plan involves the use of x-ray ore-sorting, which should reduce process tailings, process water usage, process energy requirements, and CO2 emissions. - The project is not located within any protected areas and has received archeological clearances from the Mexican government. Environmental permitting is by far the biggest remaining risk for the Ixtaca project. We expect that the elimination of this risk (via receipt of the required permits) will lead to a takeover bid for AAU from a mid-tier miner.
18th March 2019, Weekly Update (Stock price: US$0.59)	Almaden Minerals (AAU) published its financial statements for the quarter and year ending December-2018. They show that the company had about C$4M of working capital at 31st December, which is about C$4M less than it had at the end of the preceding quarter. This suggests to us that the company will do another equity financing soon. Our guess is that it will raise C$4M-$6M within the next month. Anticipation of an equity financing could maintain downward pressure on the stock price in the very short-term, but AAU's risk/reward remains very attractive. We continue to expect that AAU will receive a takeover bid soon after completion of the Ixtaca project's environmental permitting.
11th February 2019, Weekly Update (Stock price: US$0.71)	Almaden Minerals (AAU) is focused on the Ixtaca gold-silver project in Mexico. The project has a very positive FS and is now in the environmental permitting phase. At current metal prices it is easy for us to justify a value of US$1.50-$2.00 for AAU shares, versus the current share price of US$0.71. Also, AAU is not as risky as most other microcap mining stocks. Needless to say, we remain comfortable with AAU's inclusion in the List. Note that exposure to AAU's Ixtaca project also can be obtained by purchasing the shares of Almadex Minerals (DEX.V), because DEX's most important asset is its Ixtaca royalty.
17th December 2018, Weekly Update (Stock price: US$0.63)	Almaden Minerals (AAU) published the results of the FS for its Ixtaca (a.k.a. Tuligtic) gold-silver project in Puebla State, Mexico, after the close of trading on Tuesday 11th December. The overall plan is to develop Ixtaca into an open-pit mine with average annual production of around 200K gold-equivalent ounces. This suggests that the project is big enough to be of interest to a mid-tier gold or silver miner. The table inserted below outlines the salient details of the FS, but it's worth highlighting the following: 1. At gold and silver prices of $1275/oz and $17/oz, resp., the after-tax NPV(5%) is US$310M and the after-tax IRR is 42%. These metal prices are comparable to the prices assumed in the PFS completed in April-2017. 2. The economics estimated in the FS are almost identical to the economics estimated in the PFS. This is a little disappointing given the engineering improvements that the company touted over the past year, but the upshot is that the economics remain very positive. 3. Importantly, at gold and silver prices of only $1125/oz and $14/oz, resp., the after-tax IRR is still a healthy 25%. 4. The production, resource and reserve figures quoted in the table are gold-equivalent amounts using a gold/silver ratio of 75, but the reserves and production are roughly 50% silver and 50% gold. In other words, this is a silver project as much as a gold project. 5. The bottom line of the table shows our favourite measure of the extent to which a single-project exploration-stage mining company is over/under-valued. It is the EVCC/NPV ratio, or the company's enterprise value plus the estimated cost of building a mine divided by the mine's estimated net present value. The lower the EVCC/NPV ratio, the better the value. What we consider to be attractive value is indicated by an EVCC/NPV ratio of 1.0 or lower. In AAU's case, based on the figures in the just-released FS and the current stock price the ratio is 0.78. This is very low, even in the current depressed market environment. TABLE (refer to the 17th December Weekly Update) The main risk is the same now as it was 18 months ago: permitting. AAU intends to submit its environmental permit application to Mexican authorities in the near future. AAU's management is confident of getting the necessary approvals. However, mine permitting should never be taken for granted, even when the environmental engineering has been completed to a high standard and the local community is in favour of a mine being built (as appears to be the case here). Note that the plan for AAU does NOT involve putting the Ixtaca project into production. AAU's managers are explorers and prospect generators, not mine builders and operators. Instead, the goal is to sell the company to a mid-tier gold or silver miner. The most likely time for a takeover bid is shortly after the mine permits have been granted.
12th November 2018, Weekly Update (Stock price: US$0.51)	Almaden Minerals (AAU) published its financial statements for the September-2018 quarter, revealing that the company had C$8M of working capital at 30th September. This is C$3.3M less than it had at the end of the preceding quarter, meaning that the company consumed about C$3M of cash during the latest quarter. Assuming that the company spends about the same amount this quarter as it spent last quarter, it should end the year with working capital of C$4M-C$5M. This suggests to us that AAU will do its next equity financing during the first quarter of 2019. AAU is expected to reach two milestones before year end. They are FS completion and submission of the Environmental Impact Assessment for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico. The FS should confirm extremely positive economics for the project. We continue to expect that AAU will receive a takeover bid soon after completion of the FS and environmental permitting.
29th October 2018, Weekly Update (Stock price: US$0.58)	Almaden Minerals (AAU) reported some good results from infill drilling within the proposed pit at its Ixtaca gold-silver project, including 40m averaging 4-g/t gold. The drilling results won't add to the resource estimate, but they confirm the continuity of the mineralisation within the pit. We are looking forward to the Ixtaca FS, which should be complete before year-end.
8th October 2018, Weekly Update (Stock price: US$0.59)	Almaden Minerals (AAU) plans to use the Rock Creek mill formerly owned by Novagold and located in Alaska at its Ixtaca gold-silver project in Mexico. Using the second-hand mill saves a lot of money and substantially improves the economics of AAU's project. AAU advised last week that the mill has been dismantled and the mill components have been cleaned, crated and packed to ensure safe storage near the port of Nome, Alaska, ready for shipment to Mexico in 2019. AAU also advised last week that the Ixtaca FS is almost complete. We expect that the FS will reveal very positive economics at the current gold price.
13th August 2018, Weekly Update (Stock price: US$0.65)	Almaden Minerals (AAU) published its financial statements for the June-2018 quarter, revealing that the company had C$11.3M of working capital at 30th June. Although this is only about C$1M less than it had at the end of the preceding quarter, during the intervening period the company raised about C$9M via a private placement at C$1.00/share. This means that the company consumed about C$10M of cash during the latest quarter. The high quarterly cash burn was due to the company making its final payment on the second-hand mill it agreed to purchase three years ago. This payment accounted for C$6.1M of the quarter's cash expenditure. The aforementioned working capital amount should be enough to fund AAU through FS completion and submission of the Environmental Impact Assessment for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico. Both of these milestones are expected to happen before year-end. We continue to expect that AAU will receive a takeover bid soon after completion of the FS and environmental permitting.
23rd July 2018, Weekly Update (Stock price: US$0.69)	Almaden Minerals (AAU) announced very good news in the form of positive results from ore sorting trials carried out on samples from the Ixtaca gold-silver project in Puebla State, Mexico. The ore sorting tests were carried out using a commercial X-ray Transmission (XRT) sorter and a bulk sample from the limestone host rock in the Ixtaca Main zone. The limestone host rock comprised 82% of the metal produced in the 2017 PFS. According to AAU's press release, conventional XRT ore sorting technology: "Increases average mill feed grades for the limestone unit by 39% for gold, and 47% for silver; Is expected to significantly increase average annual metal production above the 147,900 ozs AuEq per year achieved in the 2017 PFS; Is expected to improve project economic metrics such as IRR and Payback (on an after-tax basis, 41% and 2.2 years, respectively, in the 2017 PFS); ...Is expected to result in only modest impact on capital costs; Has the potential to reduce the environmental footprint over the life of mine by: -- Reducing process tailings; -- Reducing process water usage; -- Reducing process energy requirements and CO2 emissions." AAU states that the detailed impact of ore sorting on the Ixtaca project will be evaluated as part of the ongoing FS, which is scheduled to be complete late this year. Considering the information outlined above it is clear that ore sorting will have a very positive impact on the Ixtaca project's economics. Unfortunately, for the types of stocks we are focused on the current market is one in which bad news matters and good news doesn't. Hence the lack of any discernible market reaction to AAU's good news.
4th June 2018, Weekly Update (Stock price: US$0.71)	Almaden Minerals (AAU) reported the assay results from holes drilled 1.2 kms from the PFS pit at its Ixtaca gold-silver project. The results included an intercept averaging 0.83-g/t gold over 89.5m and suggest the potential for significant resource expansion. This is good news. Our continuing interest in AAU is due to it being a very under-valued junior gold miner that likely will attract a takeover bid after completion of the Ixtaca FS late this year.
14th May 2018, Weekly Update (Stock price: US$0.77)	Almaden Minerals (AAU) published its financial statements for the March-2018 quarter, revealing that the company had C$12M of working capital at 31st March (about C$4M less than at the end of last year). The aforementioned working capital amount should be enough to fund AAU through environmental permitting and FS completion (due by year-end) for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico. Furthermore, the MD&A published with the financial statements contained the following: "The Company expects its current capital resources will be sufficient to carry out its exploration plans and operations for the foreseeable future." However, within hours of publishing the MD&A the company advised that it was raising C$7M by issuing new shares at C$1.00. So, a company that doesn't need the money has decided to issue new shares at a time when the share price is near a 2-year low. It's a great deal for the participants in the financing (insiders and a small number of favoured investors), but a bad deal for all other AAU shareholders. It's likely that AAU will receive a takeover bid soon after completion of the FS and environmental permitting.
2nd April 2018, Weekly Update (Stock price: US$0.84)	Almaden Minerals (AAU) published its financial statements for the latest quarter, revealing that the company had about C$15.7M of working capital at 31st December (about C$1M less than at the end of the preceding quarter). This should be enough to fund AAU through environmental permitting and FS completion for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico. We had guessed that the FS would be complete by mid-2018, but in the MD&A issued with the latest financial statements the company simply stated that it would be completed in 2018. This vague comment suggests to us that it won't be complete until much later in the year.
26th February 2018, Weekly Update (Stock price: US$0.90)	Almaden Minerals (AAU) reported a high-grade intercept (29m grading 5.6-g/t gold) from a hole drilled immediately below the PFS pit at its Ixtaca gold-silver project. This is good news as it suggests the potential to expand the PFS mine plan.
22nd December 2017, Market Update (Stock price: US$1.03)	Almaden Minerals (AAU) has confirmed, via additional drilling, the discovery of significant gold mineralisation at its Ixtaca gold-silver project in part of the modeled PFS pit that was previously considered waste material. The new zone of mineralisation will be included in future mine plans and its discovery highlights the expansion potential of the project. AAU's stock price plunged between late-October and early-December for no valid company-specific reason, prompting us to describe the stock as "dirt cheap" in the 11th December Weekly Update. The stock price is now about 35% higher. It still offers very good value, but some consolidation of the recent gains would be normal.
18th December 2017, Weekly Update (Stock price: US$0.94)	Almaden Minerals (AAU) advised that an independent consultant has completed a Social Impact Assessment (SIA) for the company's Ixtaca gold-silver project in Pueblo State, Mexico. An SIA is not a regulatory requirement for a mining project, but AAU decided to get one done as part of its efforts to ensure that the local community is informed and supportive. This is good risk management. Mining companies never get rewarded by the stock market for maintaining a constructive relationship with the local community, but they get hammered by the stock market when a poorly managed relationship with the local community gets in the way of mine development or operation.
11th December 2017, Weekly Update (Stock price: US$0.76)	Many junior gold and silver mining stocks, including a few members of the TSI Stocks List, have been a lot weaker than the gold-mining indices over the past month or so. In some cases (for example, AKG and BLK.AX) the price weakness can be partially explained by company-specific negatives, but in most cases it is due to a general lack of speculative demand exacerbated by tax-loss selling. A good example is Almaden Minerals (AAU), a chart of which is displayed below. AAU's price has plunged over the past few weeks for no company-specific fundamental reason. The stock is now dirt cheap.
27th November 2017, Weekly Update (Stock price: US$0.94)	Almaden Minerals (AAU) has discovered significant gold mineralisation at its Ixtaca gold-silver project in part of the modeled PFS pit that was previously considered waste material. This is a positive development that highlights the project's expansion potential.
13th November 2017, Weekly Update (Stock price: US$0.92)	Almaden Minerals (AAU) published its financial statements for the latest quarter, revealing that the company had about C$17M of working capital at 30th September (C$3M less than at the end of the preceding quarter). This should be enough to fund AAU through environmental permitting and FS completion for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico. Our guess (the company has not provided estimated completion dates) is that the FS will be complete and environmental permits will be in place by mid-2018, paving the way for a takeover bid during the second half of 2018.
6th November 2017, Weekly Update (Stock price: US$0.90)	Almaden Minerals (AAU) reported a result from infill drilling that highlights the high-grade nature of the Ixtaca gold-silver project. The press release that reported the good drilling result also made a point that was new to us. The deposit is largely comprised of zones containing numerous high-grade veins and veinlets hosted within barren limestone. Due to the grade-reducing effect of the barren limestone the average reserve grade is 1.17-g/t gold-equivalent. This is a decent grade for an open-pit mine, but it significantly understates the grade that will actually be mined due to the ability to target the parts of the deposit containing the gold-silver veins. While this potential is accounted for in the PFS, what isn't accounted for is the likelihood that the exposure of the vein system during mining will enable visual distinction between veining and limestone waste, paving the way for more selective mining and waste definition. In other words, there's a good chance that the results achieved during actual mining will be better than the results estimated in the PFS and the currently-in-progress FS. This probably won't matter to the average gold-stock speculator, but it should matter to the larger mining companies that are the potential acquirers of AAU. We expect that AAU will receive a takeover bid next year -- after the FS is complete and the Ixtaca project is fully permitted. After AAU's price had rocketed up to the US$1.70s for no apparent reason in April we wrote that the stock was a reasonable candidate for partial selling. Now, with the stock price having plunged to around US$0.90 for no apparent reason the opposite is the case. AAU has just become a strong speculative buy. Be aware, though, that sector-wide weakness could cause the stock to test intermediate-term support at US$0.70-$0.80 before it bottoms out. Scale in on weakness, scale out on strength, rinse and repeat.
14th August 2017, Weekly Update (Stock price: US$1.10)	Almaden Minerals (AAU) published its financial statements for the June-2017 quarter, revealing that the company had about C$20M of working capital at 30th June. This should be enough to fund AAU through environmental permitting and FS completion for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico.
24th July 2017, Weekly Update (Stock price: US$1.24)	Almaden Minerals (AAU) updated the market on the progress of its Tuligtic gold-silver project in Mexico. The company reported results from holes drilled inside and slightly outside the PFS pit. These results add to the confidence level in the resource estimate and could slightly increase the estimated resource. Also, the company confirmed that the project FS is well underway and that its environmental impact assessment is on track to be submitted to the relevant Mexican authorities this quarter. Granting of the required mine permits will, we think, be the catalyst for a takeover bid for AAU next year.
5th June 2017, Weekly Update (Stock price: US$1.38)	Almaden Minerals (AAU) completed its previously announced "bought deal" private placement by issuing 9.8M new shares at C$1.75 to raise C$17.2M. Worth noting is that the underwriters exercised their over-allotment option in full, indicating that there was strong demand for AAU shares near the financing price. Also worth noting is that 2.9M of the new shares were bought by Coeur Mining (CDE). This suggests that CDE may be interested in acquiring AAU's Tuligtic project once the FS is complete and permits are in place.
15th May 2017, Weekly Update (Stock price: US$1.42)	Almaden Minerals (AAU) published its financial statements for the March-2017 quarter, revealing that the company had C$10.7M of working capital at 31st March. Taking into account the recently-announced C$15M equity financing and spending carried out since 31st March, the working capital is probably now C$24M-C$25M. This should be enough to fund AAU through environmental permitting and FS completion for the company's flagship Ixtaca gold-silver project in Puebla State, Mexico.
8th May 2017, Weekly Update (Stock price: US$1.38)	Almaden Minerals (AAU) announced an equity financing late last week. The company is raising C$15M by issuing about 8.6M new shares at C$1.75 (US$1.28 at the current exchange rate) per share. This financing is larger and came earlier than we were expecting, but from a risk management perspective it is a reasonable move. It should mean that the company is now fully financed through to the completion of the Ixtaca project FS and permitting.
17th April 2017, Weekly Update (Stock price: US$1.72)	Almaden Minerals (AAU) had no news, but the stock price performed extremely well last week and is now testing last year's high. It was up by about 30% over the final two trading days of last week on heavy volume and is up by about 60% over the past two weeks. As we said, there was no news to explain last week's sudden increase in demand for AAU shares. The PFS results that were recently reported by the company highlighted the value in the shares, but 'the market' had digested this information well before last week's surge. Our guess is that a newsletter with a large following recommended the stock, which is exactly what caused a sudden increase in demand for AAU shares at around this time last year. In any case and although the stock still offers good value, the recent price surge has created a short-term selling opportunity. That is, after being an obvious candidate for new buying as recently as two weeks ago, AAU is now a reasonable candidate for PARTIAL selling. Scale in on weakness, scale out on strength, rinse and repeat.
5th April 2017, Interim Update (Stock price: US$1.29)	After the close of trading on Monday, Almaden Minerals (AAU) published the much-anticipated (by us) results of the PFS for the Ixtaca (a.k.a. Tuligtic) gold-silver project in Puebla State, Mexico. Due to expected time constraints later this week and the importance of the news we are covering the PFS now rather than waiting for the Weekly Update. The table inserted below outlines the most salient details of the PFS, but it's worth highlighting the following: 1. At gold and silver prices of $1250/oz and $18/oz, resp., the after-tax NPV(5%) is US$310M and the after-tax IRR is 41%. This means that the economics of the project are robust at current metal prices. 2. At gold and silver prices of $1150/oz and $16/oz, resp., the after-tax IRR is still a healthy 28%. 3. The production, resource and reserve figures quoted in the table are gold-equivalent using a gold/silver ratio of 70, but the reserves and production are roughly 50% silver and 50% gold. In other words, this is a silver project as much as a gold project. 4. The bottom line of the table shows our favourite measure of the extent to which a single-project exploration-stage mining company is over/under-valued. It is the EVCC/NPV ratio, or the company's enterprise value plus the estimated cost of building a mine divided by the mine's estimated net present value. The lower the EVCC/NPV ratio, the better the value. What we consider to be attractive value is indicated by an EVCC/NPV ratio of 1.0 or lower. In AAU's case, based on the figures in the just-released PFS and the current stock price the ratio is 0.74. This is extremely low in the current market environment, especially for a stock listed in North America (junior and mid-tier mining companies listed in Canada and/or the US tend to be expensive relative to similar companies listed in Australia). That AAU is very under-valued is evidenced by the fact that its stock price would have to rise to US$2.20 just to get the EVCC/NPV ratio up to 1.0. In other words, AAU would still offer good value at the current gold price at 70% above its current stock price. TABLE (refer to the 5th April Interim Update) AAU will soon begin work on the Ixtaca project's FS, but it's a near-certainty that the FS will confirm the positive economics indicated by the PFS. The main risk now is permitting. Applications for the mine permits are presently scheduled to be submitted during the third quarter of this year. AAU's management is quietly confident of getting the necessary approvals, but the government authorities in charge of such matters can be fickle. Mine permitting should therefore never be taken for granted, even when the environmental engineering has been completed to a high standard and the local community is in favour of a mine being built. We are confident that the long-term plan for AAU does NOT involve putting the Ixtaca project into production. AAU's senior managers are explorers and prospect generators, not mine builders and operators. Instead, the long-term plan for AAU would involve a sale of the company to a mid-tier gold or silver miner such as Fortuna Silver (FVI.TO), First Majestic Silver (FR.TO), Endeavour Silver (EXK) or Coeur Mining (CDE). The most likely time for a takeover bid is shortly after the mine permits have been granted.
3rd April 2017, Weekly Update (Stock price: US$1.18)	Almaden Minerals (AAU) published its annual financial statements, which revealed that the company had about C$9M of working capital at 31st December (down a little more than C$3M during the final quarter of 2016). Taking into account subsequent spending and the C$3.4M raised via an equity financing in February, we guess that the company now has about C$10M in the bank. This should be enough to fund the business over the remainder of this year, but it's a good bet that AAU will do another small equity financing during the second half of the year. There was no update regarding the Tuligtic gold-silver project's PFS schedule. The PFS was previously scheduled to be complete during the first few months of this year, so it should now be very close to completion.
13th February 2017, Weekly Update (Stock price: US$1.22)	Almaden Minerals (AAU) has added C$3.4M to its treasury by issuing 2.5M new shares at C$1.35/share. It probably had enough cash in the treasury (C$12.4M at 30th September) to finance its work through to the end of this year prior to last week's placement, but it's good risk management to take advantage of an open financing window. Considering the large number of equity financings announced by junior and mid-tier gold miners over the past few weeks, the financing window has clearly been wide open of late. The new shares issued in these financings are usually subject to a 4-month lock-up, which means that they won't become available for sale until the second quarter of this year. When they do become available for sale the additional supply will create downward price pressure. Note that the downward price pressure mentioned above probably won't directly affect AAU, as the new shares issued by AAU probably went to long-term holders and the number of shares is relatively small. The downward pressure will come from the large, brokered equity financings that were completed over the past month or are due to be completed over the coming month. AAU also reported another batch of results from drilling in and adjacent to the proposed pit at its Tuligtic gold-silver project in Mexico. As was the case with earlier results, the latest results point to significant expansion potential. The next major milestone for the company will be completion of the PFS for the Tuligtic project, which is expected during the first few months of this year. The PFS is likely to highlight the value offered by AAU shares. In rough terms and based on what is known today, we think that AAU shares would be fully valued at US$1.50 with gold at $1200/oz, US$2.00 with gold at $1250/oz and US$2.50 with gold at $1300/oz.
28th December 2016, Interim Update (Stock price: US$1.00)	AAU plunged during the first half of December due to a ramp-up in selling pressure that was not based on any company-specific issues that we are aware of. AAU's performance over the next two months should be helped by the announcement of positive PFS results for its Tuligtic gold-silver project in Mexico.
14th November 2016, Weekly Update (Stock price: US$1.17)	Almaden Minerals (AAU) published its quarterly report for the September quarter. The company had about C$12.4M of working capital at 30th September, which is about $5M more than at the end of the preceding quarter. The increase was due to the exercising of warrants. This should mean that AAU is fully-funded for the next 12 months, although we expect that the next equity financing will be done during the first few months of 2017 -- after the results of the Tuligtic project's PFS are reported.
7th November 2016, Weekly Update (Stock price: US$1.39)	Almaden Minerals (AAU) reported results from on-going metallurgical testing associated with the PFS for its Tuligtic gold-silver project in Mexico. The results reported last week indicate 90% recovery for both gold and silver, which is both very good and consistent with the project's PEA. The company advised that it expects the PFS to be completed early next year.
17th October 2016, Weekly Update (Stock price: US$1.22)	Almaden Minerals (AAU) reported the discovery of a new zone of relatively-high-grade mineralisation within the planned pit at its Tuligtic gold-silver project in Mexico. The important drill hole returned a 14.4m intercept grading 3.57 g/t gold and 146.9 g/t silver. The next milestone -- and probably the next market-moving event -- for AAU will be completion of the Tuligtic project's PFS. This will probably happen early next year.
19th September 2016, Weekly Update (Stock price: US$1.35)	Almaden Minerals (AAU) reported the results from exploratory drilling conducted below and adjacent to the pit defined in the January-2016 PEA for its Tuligtic gold-silver project in Mexico. The results were positive in that they reveal expansion potential. The PFS for the Tuligtic project is well advanced, although AAU's management apparently doesn't like to commit itself to completion dates. Reading between the lines, our guess is that the PFS will be completed during the first quarter of 2017.
15th August 2016, Weekly Update (Stock price: US$1.65)	Almaden Minerals (AAU) published its quarterly report for the June quarter. The company had about C$7M of working capital at 30th June, but subsequent to quarter-end the amount of working capital increased to around C$14M due to the exercising of warrants. This should mean that AAU is fully-funded for at least the next 12 months. Also, AAU reported that its exploration drilling had intersected a high-grade vein zone outside the current M&I resource at its Tuligtic project in Mexico. This drilling result won't affect the PFS currently underway, but is positive in that it confirms the project's exploration/expansion potential. AAU still offers reasonable value, especially relative to the stocks of many other exploration/development-stage junior gold miners. That being said, last week's price action created another short-term selling opportunity.
25th July 2016, Weekly Update (Stock price: US$1.35)	Almaden Minerals (AAU) advised that it has added about C$7M of cash to its treasury due to shareholders having exercised about 4.4M C$1.58 warrants. This has boosted the company's cash to C$13.8M, which should be more than enough to fund the business for the next 12 months. The run-up in its stock price over the past few months created an excellent opportunity for shareholders to take some money off the table, but AAU remains one of the best value propositions in the gold-mining sector. Based on what we know at this time, a decline in the price of AAU shares to the low-US$1 area within the coming three months would create an excellent opportunity for new buying.
20th June 2016, Weekly Update (Stock price: US$1.22)	Almaden Minerals (AAU) provided an update on the progress of work at its Tuligtic gold-silver project in Mexico. The press release contained a lot of detail about the work that was being conducted to complete the PFS and expand the resource, but was vague about the timeline. However, the impression we get is that completion of the PFS will happen much later than we were expecting prior to last week. We had been led to believe that the PFS would be completed in the middle part of this year, but the following excerpt from last week's press release suggests that it might not happen until early next year: "The related geotechnical, geomechanical, and hydrologic field programs will be completed to a PFS level this year, allowing for the completion of a PFS and submittal of environmental permits shortly afterwards." This could mean that AAU's news vacuum will continue for at least six more months. AAU's price action has been very choppy over the past two months (see chart below). It rallies for a few days, but just when it appears to be ready for an upside breakout it reverses downward. It then declines for a few days, but just when it looks ready to break out to the downside it reverses upward. To create the next buying or selling opportunity it will have to break-out one way or the other. At this stage we would view a break above the top of the range and a quick move up to resistance at US$1.50-$1.60 as an opportunity to do some selling and a break below the bottom of the range and a decline to the low-US$0.80s as an opportunity to do some buying.
13th June 2016, Weekly Update (Stock price: US$1.17)	With a gain of 72% (in US$ terms) since the beginning of the year, AAU has underperformed our benchmark (GDXJ). That's despite being given a helping hand by Porter Stansberry in April. A possible explanation is the lack of any significant news. AAU has been very quiet on the news front over the past 6 months as it focuses on the PFS for its Tuligtic gold-silver project in Mexico. We expect that the PFS will be complete within the next month or so. AAU offers good value near its current price and the chart pattern suggests the potential for a move to a new high for the year prior to an intermediate-term top, but maintaining this potential involves remaining above the 50-day MA on a daily closing basis.
30th May 2016, Weekly Update (Stock price: US$1.03)	Almaden Minerals (AAU) announced that it has raised C$4.4M by issuing 3.2M new shares at C$1.35/share. Two weeks ago we wrote "...it is reasonable to expect that AAU's management will soon do a small equity financing (we guess C$3M-C$4M) to top-up the treasury", so the aforementioned financing news hardly came as a surprise. We estimate that AAU now has about C$8M of cash in the bank. We continue to think that AAU will be a good stock to accumulate on weakness over the months ahead in preparation for the gold-mining sector's next bull-market leg and an eventual buyout.
16th May 2016, Weekly Update (Stock price: US$1.12)	Almaden Minerals (AAU) issued its quarterly report for the quarter ending 31st March 2016. The balance sheet included with the report showed C$4M of working capital at 31st March. This would be enough to fund the company through to year-end, but it is reasonable to expect that AAU's management will soon do a small equity financing (we guess C$3M-C$4M) to top-up the treasury. Our estimate of AAU's fair value varies greatly depending on the assumed gold price. For example, at a gold price of $1150/oz we think the stock would be fully valued at around US$1.00/share (slightly below last Friday's close), but at $1300/oz our valuation is US$2.50/share. The next important news for AAU is expected to be completion of the PFS for the Tuligtic gold-silver project in Mexico. This will probably happen during the third quarter of 2016. AAU will be a good stock to accumulate on weakness over the months ahead in preparation for the gold-mining sector's next bull-market leg and an eventual buyout.
9th April 2016, Market Update (Stock price: US$1.12)	The past week's price performance of Almaden Minerals (AAU) is worthy of comment. The stock was up 38% on Thursday on high volume and no news. It was then up an additional 19% on Friday, again on high volume and no news. This resulted in a gain of 65% over the final two days of the week. The reason was a buy recommendation in a letter from Porter Stansberry to his large subscriber base. Stansberry has established a new gold-stock newsletter and included AAU in the newsletter's initial portfolio as one of four gold explorers. We reiterated a week ago that AAU would be worth around US$2.50/share at a gold price of $1300/oz. At the current gold price of $1240 our estimate of fair value is around US$2.00/share, so last week's surge from US$0.68 to US$1.12 certainly hasn't caused the stock to become over-priced. The price surge has, however, caused the stock to become very 'overbought' on a short-term basis. This means that, depending on exposure to this stock and to gold stocks in general, it could make sense to do some selling of AAU shares while maintaining a core position.
3rd April 2016, Market Update (Stock price: US$0.71)	Almaden Minerals (AAU) issued its mandatory reports for the quarter and year ending 31 December 2015. Taking into account the balance sheet at 31st December and subsequent spending, we estimate that AAU presently has only about C$5M of working capital. This should be enough to fund the company until the end of 2016. The next milestone for AAU will be completion of the PFS for the Tuligtic gold-silver project in Mexico, which is likely to happen around mid-year. If the PFS confirms the numbers in last year's PEA then AAU shares would be fairly valued at US$1.00 at $1150/oz and US$2.50 at $1300/oz. These estimates are based on a formula that takes into account the company's enterprise value, the project's NPV and the project's initial capex.
29th February 2016, Weekly Update (Stock price: US$0.74)	Almaden Minerals (AAU) put out a press release to report the assay results from a single infill/metallurgical drill hole and to provide a general corporate update. This is the sort of press release that junior mining companies sometimes issue for the primary purpose of reminding the investing community of the company's existence. In this case the message was: "Hey, gold stock investors and analysts, don't forget about us -- we are ploughing ahead with the development of a potentially-economic gold deposit in a decent location."
27th December 2015 Email Update (Stock price: US$0.70)	Chart 4 shows Almaden Minerals (AAU), which is down by about 30% YTD but up by about 30% over the past 4 weeks. It took the market a while to figure out that AAU is on the right track with the revised strategy for its Tuligtic gold-silver project, but the message now appears to be getting through. That being said, AAU just reached resistance defined by its 200-day MA and is currently not an ideal candidate for new buying.
14th December 2015, Weekly Update (Stock price: US$0.56)	Almaden Minerals (AAU) published the results of an updated PEA for its Tuligtic gold-silver project in Mexico. The PEA was updated to reflect: 1) The use of the Rock Creek mill 2) A smaller, near-surface and payback-focused pit 3) A revised mine production schedule, which targets higher grades earlier 4) Optimised waste placement and tailings management facilities 5) The 2-per-cent net smelter royalty now held by Almadex Minerals The smaller operation envisaged in the updated PEA would have an initial capex requirement of US$100M and average annual production of around 107K gold-equivalent ounces (roughly half gold and half silver) over a 13-year mine life. Due to these changes, the Tuligtic project now appears to be economically robust at gold and silver prices of $1150/oz and $16/oz, respectively, and to have marginally positive economics down to gold and silver prices of $1000/oz and $14/oz, respectively. Specifically, the after-tax IRR is estimated to be 30% at $1150/oz and 18% at $1000/oz. At $1300/oz the after-tax IRR rises to 40%. Based on the figures published by the company last week, we estimate that AAU shares would be fairly valued at US$1.00 at $1150/oz and US$2.50 at $1300/oz. These estimates are based on a formula that takes into account the company's enterprise value, the project's NPV and the project's initial capex. This means that the stock's valuation-related upside potential is massively leveraged to the gold (and silver) price. The next important milestone for AAU will be completion of the PFS for the Tuligtic project. Based on the current work progress we guess that this will happen around mid-2016.
23rd November 2015, Weekly Update (Stock price: US$0.50)	Almaden Minerals (AAU) announced its expected equity financing after the close of trading last Tuesday. The company is raising C$3.3M by issuing 4.5M units at C$0.75, with each unit comprising one share and one-half of a 2-year share purchase warrant with an exercise price of C$1.00. Not including the value of the warrants, the financing price is slightly above the market price at the time of the announcement. The timing of this financing is not ideal in that it was arranged with the stock price near a multi-year low, but it had to be done.
16th November 2015, Weekly Update (Stock price: US$0.53)	Almaden Minerals (AAU) published its financial statements for the September quarter. Taking into account the balance sheet at 30th September and subsequent spending, we estimate that AAU presently has only about C$3M of working capital. This is probably only enough to fund the company for another 3-6 months, so it is reasonable to expect that AAU will soon raise additional money. We suspect that it will do a $3M-$5M equity financing, but there are other possibilities. For example, it could choose to finance itself by selling a silver and/or gold stream linked to future production from its Tuligtic project.
26th October 2015, Weekly Update (Stock price: US$0.57)	Almaden Minerals (AAU) has purchased an option to buy the 7000-tonne/day Rock Creek mill for staged payments over three years totaling US$6.5M. The purchase includes a three-stage crushing plant, gravity circuit, ball mill, flotation cells and leaching facilities, conveyors, metallurgical and chemical fire assay laboratories, a water treatment plant, full electrical circuitry including generators, and a number of spare parts for the ball mill and crushers. The Rock Creek mill was built by NovaGold Resources and was only operated for a few months before being placed on "care and maintenance" in November-2008. It has apparently been maintained in excellent condition. This is a very good deal, because: a) It is expected to reduce the initial capex in AAU's "ramp-up" scenario -- which is obviously now the preferred scenario -- for the Tuligtic gold-silver project by US$70M. As per the September-2014 PEA, the "ramp-up" scenario involves starting with a 7000-tonne/day operation and then using the cash generated during the first few years to expand. b) The up-front payments are relatively small, with only US$750K due to be paid by the end of next year ($500K this year and $250K next year). c) It reduces the risk and should substantially improve the economics of the Tuligtic project. We won't know the effect on the project's economics until the company publishes the results of its PFS in a few months' time, but our back-of-the-envelope calculation indicates that at a gold price of $1200/oz the deal increases the 'fair value' per AAU share from around US$0.50 to around US$2.00. The effect is potentially so large because AAU's market cap is very small relative to the project's capex and NPV. The stock price is not going to move up to US$2.00 anytime soon, even if the gold price rises above $1200/oz. However, buying at a large discount to 'fair value' improves a speculator's chances of eventually achieving a large profit. We suspect that the stock price is being held back by anticipation of an equity financing -- the same anticipation that prevented us from highlighting the stock as a candidate for new buying prior to last week's news. The company will probably do an equity financing within the next three months, but this shouldn't stop intermediate-term or long-term traders from taking advantage of the current substantial price discount.
21st September 2015, Weekly Update (Stock price: US$0.52)	Almaden Minerals (AAU) reported additional results of metallurgical testing associated with the on-going PFS for its Tuligtic gold-silver project in Mexico. The new results were generally consistent with past results, with >90% combined gravity and flotation recoveries to a concentrate for both gold and silver. Metallurgical testing is always a critical part of the mine-development process. Indications continue to be that Tuligtic's metallurgy is conducive to economic mining. Another critical part of the mine-development process is working closely with, and maintaining a good relationship with, the local communities. AAU put out a press release last week detailing the actions it has taken over the years to mitigate the risk that the Tuligtic project will be delayed by conflict with the Mexican communities that will be most affected by the development of a mine. As far as we can tell, AAU has done as much as it should and reasonably could have done in this area.
17th August 2015, Weekly Update (Stock price: US$0.66)	Almaden Minerals (AAU) published its financial statements for the June quarter. The Almadex spinout happened subsequent to the quarter-end, so the current balance sheet will be materially different from the published balance sheet. Taking into account the effects of the spinout, we estimate that AAU presently has a bit less than C$6M of working capital. This is probably only enough to fund the company for another 6-9 months, so it is reasonable to expect that AAU will raise additional money before year-end. We suspect that it will do a $3M-$5M equity financing, but there are other possibilities.
10th August 2015, Weekly Update (Stock price: US$0.77)	Almaden Minerals (AAU) will begin trading 'ex' the Almadex spinout on Monday 10th August. AAU shareholders of record on 7th August are now also shareholders of Almadex, which should soon begin to trade on the TSXV under the symbol AMZ. We own AAU shares and intend to hold our AMZ shares for now. In fact, if they trade at a low enough price we might even add to our AMZ position. However, AMZ is too small and will almost certainly be too illiquid to go into the TSI Stocks List, so for TSI record purposes we will assume that the AMZ shares are sold on the market and treat the proceeds of the sale as a dividend. Also, we will put AMZ in the TSI Small Stocks Watch List.
3rd August 2015, Weekly Update (Stock price: US$0.62)	Almaden Minerals (AAU) advised that 7th August will be the record date for the spin-out of Almadex shares to existing shareholders, meaning that anyone who wants to participate in the spin-out -- and receive 0.6 shares of Almadex for each of their Almaden shares -- will have to own Almaden shares by Friday 7th August. Almaden shares will begin trading 'ex-spinout' on 10th August and Almadex shares will probably begin trading on the TSXV a few days later under the symbol AMZ. Refer to AAU's press release for further details.
22nd June 2015, Weekly Update (Stock price: US$0.87)	Almaden Minerals (AAU) shareholders have approved the spin-out of Almadex. Following final regulatory approval at an unknown date (but almost certainly within the next few weeks), current AAU shareholders will receive 6 Almadex shares for every 10 Almaden shares they own. Almadex will trade on the TSXV under the symbol AMZ. On a different matter, AAU reported the results of metallurgical testing associated with the on-going PFS for its Tuligtic gold-silver project in Mexico. The new results were generally consistent with past results, with >90% combined gravity and flotation recoveries to a concentrate for both gold and silver. Metallurgical testing is always a critical part of the mine-development process, but usually doesn't move the market unless it reveals a serious problem. Indications are that Tuligtic's metallurgy is conducive to economic mining.
15th June 2015, Weekly Update (Stock price: US$0.88)	The spin-out of Almadex is scheduled to be approved by shareholders on 18th June. Anyone planning to buy AAU should do so ahead of the planned spin-out.
27th May 2015, Interim Update (Stock price: US$0.89)	Almaden Minerals (AAU): This is one of the gold-mining stocks that will rapidly become more valuable as the gold price moves higher. For example, we calculate that at the current gold price the company's flagship Tuligtic project is worth no more than US$0.80/share, but at a gold price of $1320/oz our calculated fair value would rise to at least US$1.50/share. AAU also owns a bunch of early-stage projects and royalty assets that will be spun out into a separate company next month.
25th May 2015, Weekly Update (Stock price: US$0.92)	Almaden Minerals (AAU) reported the results of the final drill hole of an infill drilling program at its Tuligtic gold-silver project in Mexico. The hole intersected 118m averaging around 1 g/t gold-equivalent. With infill drilling now complete, the Company is focused on engineering and environmental studies directed towards the completion of a PFS later this year.
18th May 2015, Weekly Update (Stock price: US$0.84)	Almaden Minerals (AAU) provided some more information regarding the spin-out of its early-stage and royalty assets into a new company. Assuming the spin-out is approved by shareholders at a meeting on 18th June, the new company will be called Almadex Minerals and will trade on the TSXV (stock symbol not yet known). Shares of Almadex will be distributed to existing AAU shareholders on a 0.6-for-1 basis. Immediately after the spin-out is complete Almaden will have some cash (around C$6M of working capital, we estimate) and the multi-million-ounce Tuligtic project in Mexico, and Almadex will have the following assets: - a 100% interest in the El Cobre Project in Mexico; - a portfolio of 21 other exploration projects; - a 2% NSR royalty on the Tuligtic Property in Mexico, which hosts the Company's Ixtaca discovery; - a portfolio of 21 additional NSR royalties on exploration projects in Mexico, Canada and United States identified through Almaden's past prospect generator activities; - equity holdings in several publicly-listed companies; - approximately C$5M in cash and bullion. Apart from the cash and bullion, we believe that these assets are currently being assigned no value as part of AAU. The combined market value of the two new companies is therefore likely to be higher than AAU's current market value.
20th April 2015, Weekly Update (Stock price: US$0.81)	Almaden Minerals (AAU) reported the final results from a drilling program at its Tuligtic project. The objective of the drilling was to upgrade some Inferred resources to the M&I category so that the resources could be included in the PFS currently underway. The objective appears to have been achieved. According to the company, all field work associated with the PFS will be finished next month and the PFS will be complete "later this year".
6th April 2015, Weekly Update (Stock price: US$0.87)	Almaden Minerals (AAU) published its financial results for the quarter and year ending 31st December 2014. The important number for this company is the working capital, which was C$9.2M at the end of last year and is probably now around C$14M due to the C$5.5M equity financing completed in February. This should mean that AAU is fully funded for the next 12 months. Based on what we know right now, the most important upcoming events for AAU will be the spinout of its royalty assets and early-stage projects into a separate company in June and the completion of the Tuligtic project's PFS during the second half of the year.
9th March 2015, Weekly Update (Stock price: US$0.97)	Almaden Minerals (AAU) advised that all field work and testing related to the Tuligtic project's PFS and environmental permitting will be completed by May of this year, allowing for the completion of the PFS and submittal of environmental permits later in 2015. The company also confirmed that a shareholder vote to enable the spin-out of its exploration and royalty assets into a separate company was still planned for June.
16th February 2015, Weekly Update (Stock price: US$1.10)	Almaden Minerals (AAU) announced that it has raised C$5.5M by issuing new shares at C$1.25/share. By our calculations this means that AAU now has about C$15M in its treasury, which should be enough to fund the company's exploration and engineering work for at least 12 months.
22nd December 2014, Weekly Update (Stock price: US$0.96)	Almaden Minerals (AAU) announced that it is deferring shareholder approval of the spinout of its early stage exploration projects and royalty interests (everything except the Tuligtic project), which was originally expected to happen in December-2014, to the company's 2015 annual general meeting in June-2015. This is being done to avoid the expense of an additional shareholders' meeting and to allow more time for an internal restructuring of the assets to be spun out. This schedule change isn't a big deal, but despite the additional expense we would prefer that the company had gone ahead and held a special shareholders meeting in December as originally planned. The spinout is important for shareholders as it will force the stock market to value assets that are currently being assigned no value as part of AAU.
17th November 2014, Weekly Update (Stock price: US$1.13)	Almaden Minerals (AAU) published its financial results for the September quarter. Taking into account the balance sheet in the financial statements and the spending that would have occurred since 30th September, the company should currently have about C$11M of working capital. This means that AAU should be fully funded until mid-2015. AAU's flagship project probably will probably require a gold price of at least $1250/oz to be economically viable, but the stock is currently a buy because a) the gold price is unlikely to remain below $1250, and b) the company owns many other potentially-valuable assets that are currently being assigned no value and that will be spun-off to existing AAU shareholders within the next few months.
27th October 2014, Weekly Update (Stock price: US$1.17)	Almaden Minerals (AAU) announced that it will be spinning out its royalty and early-stage exploration assets into a new company ("spinco"), with AAU retaining the Tuligtic gold-silver project in Mexico. The shares of Spinco will be distributed to existing AAU shareholders at the rate of 0.6 for 1. Therefore, a holder of 1000 shares of AAU pre-spinout will have 1000 shares of AAU plus 600 shares of Spinco post-spinout. Spinco will initially hold a 2% Net Smelter Return ("NSR") royalty on the Tuligtic project in Mexico, a 1.5% NSR on the Caballo Blanco gold deposit in Mexico (a development project currently operated by Goldgroup Mining), a 2% NSR on the Elk gold deposit in Canada (an advanced exploration project currently operated by Gold Mountain Mining Corp., a portfolio of 21 additional NSR royalties on exploration projects in Mexico, Canada and the United States, a 100% interest in the El Cobre copper-gold porphyry exploration project in Mexico and the Willow copper-gold porphyry exploration project in Nevada, a portfolio of 20 other exploration projects, and sufficient working capital to satisfy stock exchange requirements. This is a smart move by AAU's management, for three reasons. First, it forces the market to value the assets that are going into Spinco (as far as we can tell, these assets are currently not being assigned any value as part of AAU). Second, it will enable AAU to focus exclusively on its flagship project. Third, it will pave the way for an eventual purchase of AAU by a mid-tier gold or silver mining company.
15th September 2014, Weekly Update (Stock price: US$1.58)	Almaden Minerals (AAU) traded at a 6-month high last Friday, which suggests that the market is beginning to recognise the value of its Tuligtic gold-silver project. However, we will be (pleasantly) surprised if the stock is able to surmount resistance in the low-US$1.60s in the absence of a sector-wide turnaround.
8th September 2014, Weekly Update (Stock price: US$1.51)	AAU published the results of a revised PEA for the Ixtaca Zone at its Tuligtic project in Mexico. The Ixtaca Zone contains gold and silver in roughly equal dollar amounts (using a gold/silver ratio of 60). Here's what we wrote about the original PEA, which was issued in April of this year: "The PEA is based on an open-pit mine with average annual production of 260K gold-equivalent ounces (130K ounces of gold plus 7.8M ounces of silver) and a mine life of 12.1 years. It is estimated that the mine would cost about $500M to build and would operate at a cash cost of around $600/oz. At gold and silver prices of $1320/oz and $21/oz, resp., the after-tax NPV(5%) is estimated to be $437M and the IRR is estimated to be 22.2%. These figures suggest that the project would be economically viable at these metal prices, but we doubt that anyone would spend $500M building a gold mine with an NPV of $437M. At metal prices of $1530 and $29 the after-tax NPV(5%) increases to $875M and the IRR increases to 34.1%. These are robust economics." And: "...the cost to build a mine at the Tuligtic project is probably high enough that a decision to build would not be made at the current gold price [of around $1300/oz] even though it is estimated that the mine would have a cash operating margin of almost $700/oz. However, according to the PEA the project's economics are good enough that it would only require a moderately higher gold price to shift the balance in favour of mine development." The revised PEA considers two cases: An updated base case and a ramp-up case. For the updated base case, almost everything is the same except for the initial capex. By coming up with a more efficient way of doing the pre-stripping, AAU has managed to reduce the initial capex by about $100M. This makes a big difference to the economics and the potential viability of the project. Specifically, at gold and silver prices of $1320/oz and $21/oz, resp., the estimated after-tax NPV(5%) rises from $437M to $515M and the estimated IRR rises from 22% to 28%. Most importantly, the bottom row of the following table shows that the reduction in the initial capex causes the EVCC/NPV ratio (the Enterprise Value of the company plus the initial Capital Cost of the company's flagship exploration-stage project divided by the project's NPV) to fall from 1.34 to 0.95 at the current stock price and a gold price of $1320/oz. The updated base case therefore suggests that the project would be economically viable and that AAU would be a reasonable takeover target with gold in the low-$1300s, whereas the original base case suggested that a gold price of around $1450/oz would be needed. The base case uses a 30,000-tonne/day mining operation from Year 1. For the ramp-up case, the mining rate begins at 7,000-tonnes/day and is increased to 30,000-tonnes/day in Year 6. This enables the initial capex to be slashed to $244M. At the same metal prices noted above, the ramp-up case has the disadvantage of a lower NPV and IRR ($427M and 23% for the ramp-up case versus $515M and 28% for the updated base case). However, the bottom row of the following table's final column shows that the large reduction in the initial capex enabled by the ramp-up plan pushes the EVCC/NPV ratio down to only 0.78. An EVCC/NPV ratio of 1.00 or lower is good (the lower the better). An EVCC/NPV ratio of only 0.78 points to the Tuligtic project being very under-valued at the current AAU stock price. Both of the cases considered in AAU's revised PEA indicate that the economics of the Tuligtic project are significantly better than previously thought. This means that AAU offers even better value than previously thought. We suspect that the ramp-up case would be preferred in a difficult market for financing, but that the updated base case would be preferred -- due to its higher NPV and IRR -- in a market environment where reasonable-cost financing was readily available. Lastly, remember that PEA stands from PRELIMINARY Economic Assessment. It's a first pass, with detailed engineering to follow as part of the PFS and then the FS. AAU's PEA constitutes a good start, but it's just a start. TABLE (refer to Weekly Update) The stock market's reaction to AAU's PEA news was strange. There was no market reaction at all on the day of the press release, but there was a high-volume appropriately-positive reaction the next day. It seemed as if nobody got around to reading the press release until 24 hours after it was issued.
18th August 2014, Weekly Update (Stock price: US$1.49)	Almaden Minerals (AAU) published its financial results for the June quarter. Taking into account the balance sheet in the financial statements, the spending that would have occurred since 30th June and the equity financing completed at the end of last month, the company should currently have about C$15M of working capital. This means that AAU should be fully funded for the next 12 months. AAU also reported some drilling results, the most notable of which was an intercept of 2m grading 26-g/t gold from just outside the currently defined deposit. Additional drilling is needed to determine the significance of this intercept.
21st July 2014, Weekly Update (Stock price: US$1.47)	Almaden Minerals (AAU) has arranged a C$6M financing at C$1.50/share. This is a reasonable move by the company's management and was not unexpected (on 19th May we wrote that a small equity financing would probably be done during the second half of this year to top-up the treasury). We estimate that AAU will have about US$15M in the bank when the aforementioned financing is completed. This should be enough to fully fund its business for the coming 12 months.
14th July 2014, Weekly Update (Stock price: US$1.44)	Almaden Minerals (AAU) reported drilling results from its Tuligtic gold-silver project in Mexico. There were some good intercepts, but the significance level is low because the purpose of the drilling was solely to enable some of the project's Inferred resources to be updated to the M&I category. The project currently has about 3.5M gold-equivalent ounces in the M&I category and about 0.7M gold-equivalent ounces in the Inferred category. The Tuligtic project is big enough and its economics are good enough that it will probably become attractive to a mid-tier miner after the gold price makes a sustained break above $1400.
30th June 2014, Weekly Update (Stock price: US$1.36)	The top of AAU's basing pattern appears to be near US$1.70. The stock will encounter resistance near US$2.00, but US$2.50-$2.60 will be the chart-based target following a break above the top of the base.
16th June 2014, Weekly Update (Stock price: US$1.45)	AAU signaled an end to its correction by breaking above resistance at US$1.40 last week. There is additional resistance at US$1.50 that must now be overcome, after which a rise to around US$2.00 would be on the cards.
19th May 2014, Weekly Update (Stock price: US$1.30)	Almaden Minerals (AAU) published its financial results for the March quarter. The important number is the working capital, which fell by $1.5M during the quarter to around $11M. AAU is fully funded through to at least the end of this year, although we suspect that a small equity financing will be done during the second half of this year to top-up the treasury.
21st April 2014, Weekly Update (Stock price: US$1.37)	Almaden Minerals (AAU) published the results of the PEA for the Ixtaca Zone at its Tuligtic project in Mexico. The Ixtaca Zone contains gold and silver in roughly equal dollar amounts (using a gold/silver ratio of 60). The PEA is based on an open-pit mine with average annual production of 260K gold-equivalent ounces (130K ounces of gold plus 7.8M ounces of silver) and a mine life of 12.1 years. It is estimated that the mine would cost about $500M to build and would operate at a cash cost of around $600/oz. At gold and silver prices of $1320/oz and $21/oz, resp., the after-tax NPV(5%) is estimated to be $437M and the IRR is estimated to be 22.2%. These figures suggest that the project would be economically viable at these metal prices, but we doubt that anyone would spend $500M building a gold mine with an NPV of $437M. At metal prices of $1530 and $29 the after-tax NPV(5%) increases to $875M and the IRR increases to 34.1%. These are robust economics. We are pleased with the outcome of AAU's PEA. It shows that the Tuligtic project has the potential to be developed into a gold-silver mine, which means that AAU will potentially be able to sell the project to a mid-tier producer within the next couple of years. As an aside, a producing gold mine will be economically viable if the difference between the per-ounce sales price and the per-ounce operating cost (the operating margin) is greater than the sum of all indirect costs (company overheads, etc.). However, for a potential future mine to be economically viable the operating margin must be high enough to pay off the pre-production capex within a few years and cover the company's overheads. With regard to operating margin the bar is therefore set considerably higher for a potential new mine than for a mine that's already in production. For example, at the current gold price a mine with a cash operating cost of $700/oz would probably be a valuable, cash-generating asset, but it might not make sense to build such a mine today. It would depend on the expected construction cost. In AAU's case, the cost to build a mine at the Tuligtic project is probably high enough that a decision to build would not be made at the current gold price even though it is estimated that the mine would have a cash operating margin of almost $700/oz. However, according to the PEA the project's economics are good enough that it would only require a moderately higher gold price to shift the balance in favour of mine development.
7th April 2014, Weekly Update (Stock price: US$1.50)	Almaden Minerals (AAU) provided a summary of its 2014 work plans for its 100%-owned Tuligtic gold-silver project (Mexico). The company plans to complete a PEA for the project's Ixtaca zone within the next few months. The Ixtaca zone is presently estimated to contain a total gold-equivalent resource of 4.2M ounces (3.5M M&I plus 0.7M inferred). The company also plans to drill high-priority epithermal targets outside of the Ixtaca Zone but within the project's claim boundaries.
31st March 2014, Weekly Update (Stock price: US$1.37)	Almaden Minerals (AAU) issued its mandatory reports (financial statements and MD&A) for the quarter and year ended 31st December 2013. The reports showed that AAU had about $12M of working capital at the end of last year, which should be enough to fund the company through to at least the end of this year. The next important milestone for AAU is expected to be the completion of the PEA for its Tuligtic gold-silver project in Q2-2014.
17th March 2014, Weekly Update (Stock price: US$1.53)	Sometimes value, and value alone, will prompt us to single-out a stock as one of the few best candidates for new buying. For example, RIOM during the final two months of last year. Most of the time, however, we take into account value and the price chart when coming up with our weekly short-list of 'best buys'. A good place for new buying is near the bottom of what appears to be a consolidation pattern within a short-term upward trend. For example, over the past month we've regularly included LYD.TO in our short-list of 'best buys', with our specific suggestion being to buy in the low-C$1 area. With reference to the first of the following daily charts, this was because the low-C$1 area coincided with the lower portion of a consolidation pattern and also with two moving averages. LYD broke upward from this consolidation pattern last week and is probably on its way to resistance at C$1.40-$1.60. For another example, a week ago and again this week we suggested buying AAU in the US$1.40s. With reference to the second of the following daily charts, this was/is because the stock has been drifting downward for about one month and would reach its 200-day and 50-day moving averages in the high-US$1.40s.
27th January 2014, Weekly Update (Stock price: US$1.50)	Almaden Minerals (AAU) reported more results from the 2013 infill drilling program at its Tuligtic gold-silver project in Mexico. However, the moderately positive drilling news was overshadowed by a very positive resource update announced later the same day. The resource estimate published after the close of trading last Wednesday updated the initial resource estimate completed 12 months ago. At a 0.5-g/t cutoff, the January-2013 estimate was as follows: Measured (M): 0 Indicated (I): 2.0M oz gold-equivalent (Au-eq) at 1.1-g/t M&I: 2.0M oz Au-eq Inferred: 1.55M oz Au-eq at 1.16-g/t Total: 3.55M oz Au-eq At the same (0.5-g/t) cutoff, the new estimate is: Measured (M): 1.35M oz Au-eq at 1.38-g/t Indicated (I): 2.18M oz Au-eq at 1.08-g/t M&I: 3.53M oz Au-eq Inferred: 0.72M oz Au-eq at 0.98-g/t Total: 4.25M oz Au-eq This represents a moderate increase of 0.7M ounces in resource quantity, but a substantial increase in resource quality. After having risen substantially ahead of the positive resource news, the stock has begun to consolidate its gains.
22nd January 2014, Interim Update (Stock price: US$1.53)	Almaden Minerals (AAU) has moved above its 200-day MA, thus differentiating the current rally from the one that ended last August. Be aware, though, that AAU is now very 'overbought' on a short-term basis and will probably consolidate its recent gains before moving higher.
20th January 2014, Weekly Update (Stock price: US$1.54)	Almaden Minerals (AAU) reported the final results from the 2013 drilling program at its 100%-owned Tuligtic gold-silver project in Mexico. Highlights included Hole TU-13-383, which returned 100.89 m at 2.5 g/t gold-equivalent, Hole TU-13-386, which returned 81.07 m at 3.2 g/t gold-equivalent, and Hole TU-13-393, which returned 114.37 m at 2 g/t gold-equivalent. The 2013 program was focused on infill drilling designed to prove the continuity of the previously defined resource and to convert Inferred resources to M&I resources. In this regard it appears to have been successful. A new resource estimate is now underway and will be completed during the first quarter of this year. This resource estimate will form the basis of a PEA, which should be completed during the second quarter of this year. As far as mineral exploration plays go, AAU is relatively low-risk.
2nd December 2013, Weekly Update (Stock price: US$1.16)	Almaden Minerals (AAU) reported another set of results from the infill drilling program at its Tuligtic gold-silver project (Mexico). In the 4th November Weekly Update we wrote that to avoid repetition we wouldn't mention future results from AAU's 2013 infill drilling program unless the results were out of the ordinary. The latest results were far enough out of the ordinary (in a positive way) to warrant a mention. Of particular note, one hole intersected 101m with an average grade of 4.2 g/t gold-equivalent and another hole intersected 125m with an average grade of 2.3 g/t gold-equivalent. These are very good results. They are infill holes and therefore probably won't increase the size of the defined resource, but they confirm the economic potential of the deposit.
18th November 2013, Weekly Update (Stock price: US$1.21)	Almaden Minerals (AAU) issued its quarterly reports for the September quarter. The financial statements showed that the company had $16.8M of working capital at 30th September. This means that AAU should be fully funded for at least the next 12 months.
4th November 2013, Weekly Update (Stock price: US$1.31)	Almaden Minerals (AAU) reported more results from infill drilling at its Tuligtic gold-silver project in Mexico. The on-going drilling is confirming the continuity of the previously defined resource. To avoid repetition, we won't mention future results from AAU's current infill drilling program unless the results are out of the ordinary.
28th October 2013, Weekly Update (Stock price: US$1.43)	Almaden Minerals (AAU) reported more results from infill drilling at its Tuligtic gold-silver project in Mexico. The latest results were consistent with the good results reported in other press releases over the past two months.
7th October 2013, Weekly Update (Stock price: US$1.33)	Almaden Minerals (AAU) reported more results from infill drilling at its Tuligtic gold-silver project in Mexico. The drilling continues to be very successful, as exemplified by intercepts of 82m averaging 1.8 g/t gold-equivalent in Hole TU-13-308 and 41.65m averaging 3.8 g/t gold-eq in Hole TU-13-311 reported last week. AAU is a good candidate for new buying now that it has pulled back to the vicinity of its most recent equity financing (US$1.20-US$1.35).
30th September 2013, Weekly Update (Stock price: US$1.40)	Almaden Minerals (AAU) reported results from infill drilling at its Tuligtic gold-silver project in Mexico. The purpose of the infill drilling was/is to upgrade resources from Inferred to M&I and to confirm the continuity of high-grade mineralisation in the deposit's main zone. In this respect the drilling has been very successful to date, as exemplified by intercepts of 41.2m averaging 11.4 g/t gold-equivalent in Hole TU-13-309 and 89.5m averaging 2.0 g/t gold-eq in Hole TU-13-306.
23rd September 2013, Weekly Update (Stock price: US$1.38)	Almaden Minerals (AAU) reported results from three more holes drilled at its Tuligtic gold-silver project in Mexico. The highlight was Hole TU-13-314, which intersected 153.00 meters @ 1.80 g/t gold equivalent beginning only 23 meters below surface. The Tuligtic resource continues to be expanded by AAU's drilling and will probably be well over 4M ounces when the next estimate is done. However, the economics have not yet been assessed.
16th September 2013, Weekly Update (Stock price: US$1.49)	Almaden Minerals (AAU) reported drilling results from its Tuligtic gold-silver project in Mexico. The 2013 drill program is focused on expanding the known resource (3.6M gold-equivalent ounces) adjacent to the current resource shell and within what is considered a potential pit shell. The reported results were good and will almost certainly contribute to a positive resource update in the future. The best result came from Hole TU-13-295, which intersected 98 metres of 1.1 g/t gold-equivalent and 33.78 metres of 4.4 g/t gold-equivalent.
19th August 2013, Weekly Update (Stock price: US$1.96)	Almaden Minerals (AAU): AAU broke above resistance at US$1.80 last week. The first target is the 200-day MA (currently at US$2.15), which was almost reached last Friday. The more significant target with regard to taking money off the table is lateral resistance at US$2.50.
12th August 2013, Weekly Update (Stock price: US$1.66)	Almaden Minerals (AAU) issued its MD&A and Financial Statements for the June quarter. Of primary interest, the reports confirm that the company has no debt and about $23M of working capital (including the $5M raised in last month's equity financing). This means that AAU is in a strong financial position for a company of its type and size.
29th July 2013, Weekly Update (Stock price: US$1.69)	Almaden Minerals (AAU) reported results from the on-going drilling at its 100%-owned Tuligtic project, Mexico. The 2013 drill program is focused on expanding the resource immediately along strike to known mineralisation, adjacent to the current resource shell and within what is considered a potential pit shell. Just a reminder that the Ixtaca Zone at the Tuligtic project is currently estimated to contain 2.02M gold-equivalent (AuEq) ounces (960K ounces of gold plus 55M ounces of silver) in the "Indicated" category and 1.55M AuEq ounces (740K ounces of gold plus 42M ounces of silver) in the "Inferred" category, for a total AuEq resource of 3.57M ounces. Like the drilling results reported by AAU in May, the results reported last week included some decent intercepts but nothing exceptional. By far the best intercept reported last week was 119.5m grading 1.0-g/t AuEq, but all other intercepts were under 50-gram-metres.
22nd July 2013, Weekly Update (Stock price: US$1.53)	Almaden Minerals (AAU) announced that it has raised $5.4M via a private placement to a small group of Mexican and Mexican focused strategic investors. The new shares were priced at $1.25 and came with a full warrant. According to the company, issuing new shares at such a low price was justified because a) the participants in the placement will provide important support for the company in developing its flagship Tuligtic gold-silver project in Mexico, and b) the placement ensures that AAU remains in a position to continue development of Tuligtic at a reasonable pace. Following this financing AAU has about $24.4M of liquid financial assets, comprising $19M of cash (including $2.1M of gold bullion) and $5.4M of equities. It was subsequently announced that Ernesto Echavarria, a well-known Mexican businessman and the owner of significant stakes in a number of junior Canadian mining companies, participated in the above-mentioned private placement to the extent of 2.8M new shares. Mr Echavarria now owns 7M Almaden shares and 2.8M Almaden warrants, which equates to 10.9% of the company on an undiluted basis and 14.6% of the company on a partially diluted basis (that is, assuming the exercise of the warrants).
13th May 2013, Weekly Update (Stock price: US$1.62)	Almaden Minerals (AAU), our favourite "prospect generator", reported the results of two holes drilled into its 100%-owned porphyry-style El Cobre gold-copper project in Mexico. El Cobre is at a very early stage of exploration and at this time is nowhere near as important as AAU's Tuligtic project (also in Mexico), but it is a potentially valuable asset. One of the two holes intersected interesting mineralisation, including 106m grading 0.36 g/t gold and 0.23% copper. However, it's way too early to tell if El Cobre hosts an economic deposit. Due to the current difficult market conditions, AAU's management has made the sensible decision to suspend drilling at El Cobre and concentrate on Tuligtic. And with regard to Tuligtic, the company reported the second set of results from its 2013 drilling program. The first set of results was reported in March. The drilling results reported last week included some decent intercepts, but nothing exceptional. For example, one of the holes reported last week contained an intercept of 8.25m grading 4.1-g/t Au-eq, but there was nothing remotely as good as the intercept of 111.25m grading 2.9-g/t Au-eq reported in March. We can't reasonably expect every set of assays to yield intercepts with more than 200 gram-metres of gold-equivalent mineralisation. Lastly, AAU issued its quarterly financial statements and MD&A. The financial statements confirmed that the company had $16M of working capital at 31st March, down from $19M at the end of last year. This is enough to fully fund the company's business over the coming 12 months.
8th April 2013, Weekly Update (Stock price: US$1.98)	Almaden Minerals (AAU) issued its mandatory reports (MD&A + financial statements) for the year ended 31st December. The financial statements showed that AAU had about $19M of working capital at 31st December. This means that its working capital fell by about $3M over the most recent quarter, which is reasonable considering the progress made on the company's Tuligtic project. AAU is in a good financial position, because in addition to having more than enough money in the bank to fund its exploration activities over the next 12 months it has $10M of investments in other listed companies and considerable flexibility regarding the rate at which it spends money.
25th March 2013, Weekly Update (Stock price: US$2.24)	Almaden Minerals (AAU) reported the first set of results from the 2013 drilling program at its 100%-owned Tuligtic project in Mexico. Results were reported for four holes and were generally good. The highlight was hole 253, which intercepted 111.2m averaging 2.9-g/t gold-equivalent (gold + silver).
11th March 2013, Weekly Update (Stock price: US$2.15)	Almaden Minerals (AAU) has sold 6 of its early-stage exploration projects to Tarsis Resources (TCC.V) in exchange for Tarsis shares and a 2% NSR (Net Smelter Return) royalty on any future production from these projects. Whether or not this deal amounts to anything for AAU depends on the amount of success achieved by Tarsis in the future. It's a typical deal for a prospect generator such as AAU, in that some exposure to the upside potential has been retained while all the risk and cost has been passed on to another company.
6th March 2013, Interim Update (Stock price: US$2.00)	The TSI gold stocks that we think have the highest quality, where highest quality means the most favourable combination of balance sheet, location, mining assets and management, are (in alphabetical order) Almaden Minerals (AAU), Endeavour Mining (EDV.TO, EVR.AX), Evolution Mining (EVN.AX), Pretium Resource (PVG), and Sabina Gold and Silver (SBB.TO). Charts are presented below. Along the lines of what we've been talking about, these five stocks have recently been among the worst performers. We increased our exposure to each of these stocks during the first half of this week, with new purchases mostly funded by sales elsewhere. 1) Almaden Minerals (AAU), a prospect generator, traded as low as US$1.85 during the first two days of this week. There is strong support at $1.70-$1.80 and initial resistance at $2.40-$2.50. In a more normal market, the decline from the January peak would have ended at $2.40-$2.50. 2) Endeavour Mining (EDV.TO, EVR.AX), a profitable 330K-oz/yr producer with operations in West Africa, traded as low as A$1.34 in Australia and C$1.45 in Canada earlier this week, creating an exceptional buying opportunity. Initial resistance lies at C$1.90. 3) Evolution Mining (EVN.AX), a profitable 400K-oz/yr producer with operations in Australia, has possibly just completed a successful test of its July-2012 and February-2013 lows in the A$1.25-A$1.30 range. 4) Pretium Resource (PVG), an exploration-stage miner with a very high-grade 10M-ounce gold deposit in British Colombia, was pummeled on the stock market over the past two months despite no negative company-specific developments. Initial resistance is a long way above the current price. 5) Sabina Gold and Silver (SBB.TO), an exploration-stage miner with a high-grade gold resource and a potentially-valuable silver royalty in Canada's far north, has possibly just completed a successful test of its 2012 lows.
25th February 2013, Weekly Update (Stock price: US$2.12)	Almaden Minerals (AAU) advised that it has commenced a diamond drill program at its 100%-owned El Cobre porphyry copper-gold project in Veracruz State, Mexico. A single drill will be employed with the aim of completing between five and eight 500m+ holes. El Cobre is at a very early stage of exploration, but shows considerable potential. It is probably AAU's second most important project (Tuligtic being by far the most important).
18th February 2013, Weekly Update (Stock price: US$2.19)	The lowest-risk way to speculate on exploration success is via a well-managed prospect generator. As stated in the 31st December 2012 Weekly Update: "A prospect generator generates new projects with low-cost greenfields exploration programs. The probability of any single project resulting in a major discovery is very low, but a prospect generator greatly increases its chances of success by having a large stable of projects in various stages of development. Furthermore, many of the projects will be the subject of joint venture (JV) agreements with other companies, with the JV partner typically earning 50%-70% of the project by making cash or stock payments to the prospect generator and funding drilling and other work programs. When the right people are involved, the prospect generator model works well. Risk is kept low and the probability of exploration success is increased by having a large number of "irons in the fire". In addition, expenses are kept low by having other companies fund the high-cost drilling programs. There aren't many prospect generators, however, because the right people are scarce. The right people include talented field geologists with a wealth of experience, and managers who are good at identifying opportunities and negotiating deals." In the same commentary we also stated that the two best gold-focused prospect generators known to us are Almaden Minerals (AAU) and Eurasian Minerals (EMXX). Both of the above-mentioned companies are attractive speculations. They each have stakes in many early-stage projects (145 projects in EMXX's case, 40 projects in AAU's case) that in most cases are being explored using OPM (other people's money). EMXX's main advantage is that it owns royalties that are currently generating about $6M/year of income. AAU's main advantage is that it has 100% ownership of a project at which a multi-million-ounce gold resource has already been defined. Both companies have strong balance sheets (no debt and $32M of working capital + investments for AAU, no debt and $27M of working capital for EMXX) and highly regarded senior management. We would like to add one, but not both, of the above-mentioned prospect generators to the TSI Stocks List. Based on recent news and price action, we have decided to go with AAU. The news that tipped the balance in AAU's favour was last month's announcement of a maiden resource estimate and preliminary metallurgical test results for the Ixtaca Zone at the Tuligtic gold-silver project in Mexico. The 100%-owned Tuligtic project is the main advantage for AAU referred to above. At an AuEq (gold-equivalent, meaning gold plus silver with silver converted to its gold equivalent at a 52:1 ratio) cut-off of 0.5-g/t, the Ixtaca Zone contains 2.02M AuEq ounces (960K ounces of gold plus 55M ounces of silver) in the "Indicated" category and 1.55M AuEq ounces (740K ounces of gold plus 42M ounces of silver) in the "Inferred" category for a total AuEq resource of 3.57M ounces. Also, metallurgical testing achieved decent gold and silver recoveries averaging 88% for gold and 82% for silver from a combination of flotation, gravity concentration and intensive leaching. There is a lot more drilling, metallurgical testing and engineering work to be done, but indications at this stage are that the Tuligtic project contains an economically-viable deposit that will be of interest to a mid-tier gold or silver mining company. Furthermore, the project has a lot of untapped exploration potential outside the Ixtaca Zone. Despite the positive news announced at the end of last month, AAU's stock price has since fallen sharply in sympathy with the sector-wide capitulation. Company-specific fundamentals suggest that AAU is worth more today than it was a month ago, but its market price is now about 30% less. The combination of the fundamental improvement and the price deterioration has created a very good buying opportunity. AAU has been added to the TSI List at Friday's closing price of US$2.19.