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11/17/09

Constitution Mining (CMIN.ob) third quarter results


This post is for anyone stupid enough to invest in OTC exploration stage mining companies without ever reading the regulatory filings. Our subject is the outright scam known as Constitution mining (CMIN.ob) and the event is the 10-Q financial report for 3q09 filed by the company last night.
  • First, the cash position at the company is $1.15m but working capital was negative at $-0.387m, due to its debt position.
  • Second, according to the company here's what it needs to run its exploration campaign in Peru in the next 12 months:

Activity U$000s
MINERAL PROPERTY COSTS:

Surface Rights Access
150
EXPLORATION

Mapping
230
Geophysics – Seismic
400
DRILLING

Reconnaissance
1500
Resource Definition
2000
GEOTECHNICAL

Pits & Shafts
200
TECHNICAL SERVICES

Consultants
580
Personnel
430
CAMP AND FIELD EXPENSES

Camp
630
Field
250
TRANSPORT AND LOGISTICS

Air Transport
480
Water Transport
120
Ground Transport
150
EQUIPMENT & PERMITTING
210
COMMUNITY OUTREACH
300
ADMINISTRATION
150
TOTAL
7,78


Yes, that says U$7.78m


  • Next, what the company plans to squander in G&A over the next 12 months:

Two Point Four Million Dollars

  • Next, what the company needs to pay the title holders of the gold sands property, the equally scammy Temasek of Panama, on March 31st to get the third 25% of the property:
Three Million Dollars

Add 'em all up, and this is a company that has no money but needs $13.18m to go about its business. And as the following excerpt from the 10-Q makes very clear, the company is going to dilute your ass to try and get the cash. If you haven't sold yet, get the hell out of this scam.


At September 30, 2009, we had cash and cash equivalents of $1,153,669 (December 31, 2008 - $66,580) and a working capital deficit of $386,590 (December 31, 2008 - $162,440).

During the twelve month period following the date of this report, we anticipate that we will not generate any revenue. Our proposed plan of exploration anticipates that we will incur exploration related expenditures of $7,780,000 over the next twelve months. We anticipate spending approximately $200,000 in ongoing general and administrative expenses per month for the next twelve months, for a total anticipated general and administrative expenditures of $2,400,000 over the next twelve months. The general and administrative expenses for the year will consist primarily of professional fees for the audit and legal work relating to our regulatory filings throughout the year, investor relations related expenditures, as well as transfer agent fees and general office expenses. Our current cash on hand is insufficient to be able to make our planned exploration expenditures and to pay for our general administrative expenses over the next twelve months. Accordingly, we must obtain additional financing in order to continue our plan of operations during and beyond the next twelve months. We believe that debt financing will not be an alternative for funding additional phases of exploration as we do not have limited tangible assets to secure any debt financing. We anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We are currently seeking additional funding in the form of equity financing from the sale of our common stock, but cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our complete exploration program. In the absence of such financing, we will not be able to pursue our exploration program and maintain our mineral property interests in good standing. If we do not fulfill the terms of any of these option agreements according to our business plan, then our ability to commence or continue operations could be materially limited. We also may be forced to abandon our mineral property interests and cease operations.