Ausmex Gold over the past 12 months have been reporting some exceptionally high grade Gold grades from drilling at their Cloncurry prospects. Drilling from their 30% owned portion of the Newcrest IOCG anomaly which was recently described by Australia’s foremost and respected institutions CSIRO as the largest Magnetic Anomaly in the Mt Isa Inlier and indeed Australia. Add to that statement, some of the largest IOCG deposits in the world including the BHP owned Olympic Dam Copper/Gold/Uranium deposit holding billions of ore grade material discovered using geophysical survey unmasking a massive magnetic and conductive structure, it is baffling why AMG is still capped at $50m. Add this to 6 of the drill holes into the IOCG anomaly have all hit ore grade material between 50 and 70 metre intersections from near surface. Add to that, the Southern 2/3rds portion of the IOCG anomaly being drilled by Australia’s largest Goldminer Newcrest Mining in August 2019 with no results published 14 months later, seems mysterious. Combine these factors with the multiple high grade Gold results from the Golden Mile and the high grade Gold results from drilling at the company’s Mt Freda Gold Mine it even becomes more baffling why this company has a market capitalization of only $A48m.

Add again, the Companies Burra project in South Australia where the Company holds 7,000 sq klms of ground within the G2 mineralised corridor that hosts the great mines like Olympic Dam, Carapenteena, Prominent Hill. Also located within the AMG ground is the historical the Burra Monster Copper Mine that once supplied 10% of the global copper. Further, consider that all of the geophysical surveys are being carried out on the AMG ground by the geological arms of the Federal Government of Australia, Geoscience Australia ($110m program) under the guidance of AusLamp and University of Adelaide and one has to wonder why again, a market Cap $48m.

Recent geological surveys at the AMG Burra project, have identified 6 magnetic and conductive structures, one being 14klms long by 6 klms wide, all within the Ausmex ground. The Company has announced that the positioning of the drill holes and the direction will be available to the Company for drilling being issued by Geoscience Australia during the month of September.

The Company also recently announced JORC compliant geological “Target Resource Statement,” based on 19,000m of drilling of between 19-30million tonnes of ore at between 1.7g/t and 3.4g/t Gold. A quick conversion to possible ounces in the ground using 31 grams to the ounce, equates to approximately 1.2million to 6.5million ounce of Gold. Convert again to Australian Dollars (based on $A2200 ounce) and we are talking $A2 billion to $A14billion resource.


One reason that AMG has been hog tied on its share price, is that stockbrokers that deal in the resource sector has alerted Goldtalk, to a fact we were not aware of but may have answered our dilemma. It appears, one or both of the original promoters of the merger between the toxic Eumeralla/Ausmex merger, was that the promoters, managed to secure during the merger around 50m shares for their services and 50m options to top up their saddlebags, only to begin selling their shares into the Ausmex announcements that created the volume. This may be the answer we were looking for as Goldtalk has noticed that on almost every announcement made by the Company that the selling is relentless on that day, selling the price down. After watching closely we also notice that at the end of each day within the final seconds of the auction, shares appear instantly just seconds prior to the close and the stock is sold down. Almost looks deliberate to cap the share price.

Dangerous Encounters (mergers and the greedy promoters)

It is and it has been notable that the merging of companies by backdoor listings can have major downward repercussions down the track for the shareholders of the listed company being prepared for the merger. This practice is often dogged by greedy promotors lining their pockets with shares during their control over the merger, by producing over priced invoices for their services and receiving shares and options on lieu of cash. At some stage usually when the new company makes inroads and the price increases, they become the target by the promoters for the dumping of their shares. This appears to be the case of the Eumeralla/ Ausmex merger and does something to offer a reliable and understandable reason why the company is not prospering from their successes in the field and the articulate, professional management the Company offers. All we can say is at Goldtalk is, “we have seen it before and we will see it again”. However having said all that, ” we at Goldtalk have picked Ausmex as our pick for September as the most underrated and undervalued company listed on the Australian Stock Exchange.


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