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11/18/14

The Continental Gold (CNL.to) PEA: Be afraid, be very afraid

Back on October 15th, this humble corner of cyberspace floated a necessary message about the way in which Continental Gold (CNL.to) was apparently playing it fast and loose with the economics of its Buritica mine.

Last night we got the overdue PEA (linked here) and sure enough, our concerns were 100% justified as although the shysters at CNL were careful not to spell it out (not going to draw attention to their very own elephant in their very own drawing room now, are they?) CNL did indeed confirm that they plan to take this badly understood, skinny vein system deposit straight to production on the back of a PEA (scoping study) without bothering to run a pre-feas or feas study. We know this because:
  • They have 2.8m oz under M+I resource, all the rest is inferred.
  • They aim to get M+I to 3.5m oz in 2015 (see very latest corp lit on website for that)
  • The mine plan and its economics is based on mining 4.4m oz gold over 18 years.
  • Therefore CNL wants to build and go into operation on the back of inferred ounces
  • As inferred ounces are disqualified from any pre-feas or feas study (you can only play with them in the initial-stage PEA type study) the inference is crystal clear

Though not an exact carbon copy, this is the same type of stunt the very same team tried to pull over at Serra Pelada with Colossus Minerals and you, dear and kind reader, would be mad, mad and thrice mad to fall for this bullshit. Without the backing of a pre-feas minimum or feas preferred, these jokers aren't going to get any money from bankers or any love from any major miner worth its salt on the buyout stakes, that's not an opinion but a cast-iron fact. Avoid this CNL thing like the plague, it's run by people who have already proven themselves to be utterly untrustworthy who are just repeating the same pump and dump modus operandi of before.

UPDATE: Reader PB writes in with:
Hey Otto, don't go beating about the bush, tell us what you really feel about CNL!
And just for once I'm going to take that expression literally so here we go, PB. If you invest in Continental Gold based on last night's PEA and the promotion that will come as a result from company, brokerages with vested interests and paid-for pusher people...

1) You are represented by the dog in this amusing cartoon GIF
2) The reality of the stock market is represented by Foghorn Leghorn


Boy ah say boy that clear enough now?