Friday, November 15, 2013

CSI finishes burying public types

Colossus Minerals shares plunge 50% after company reveals it needs more money for Brazil mine.

"As of November 14, 2013, the Company had completed approximately 2,300 metres of total development; 1,500 primary and 800 metres secondary development. On July 15, 2013, the Company announced that some dewatering wells (bores) and pumps were not performing to design specifications and, as a result, the Company required additional dewatering capacity in order to mine the Central Mineralized Zone ("CMZ") in a sustainable, effective and efficient manner."

As disclosed in September 2013, several bores and pumps have been repaired and six bores are now operating. Refurbishment of three additional bores was not successful. Total dewatering capacity is currently at 790 m3 per hour. Three more bores are in the process of being refurbished. Two additional bores with a capacity of 250 m3 per hour each are being established. Installation of this equipment has been delayed due to issues of mobilizing drill rigs to site and equipment supply. It is currently expected that the first of the two new wells will be operational by early December 2013.

The rate of recharge to the bore field has been observed to be approximately 20% higher than anticipated during the period September and October 2013."

So lets just state the facts shall we? The best of Sera Palada was mined out to the water table years ago and what lies below that cannot be mined at any price. The obvious conclusion that this management knew all this from day fukkin one cannot be avoided. This is as bad as it gets.


Colossus Minerals halted its paper late yesterday, released news, and then released full details immediately before resuming trading. Halting at the end of day (and Fridays) before news usually means its all bad and CSI.t proves that rule through the announcement of a wicked large dilutive unit offering at rock bottom.


Colossus Minerals Inc., in connection with its previously announced overnight marketed public offering of equity securities, has entered into an underwriting agreement between the company and a syndicate of underwriters co-led by GMP Securities LP and Dundee Securities Ltd., together with Canaccord Genuity Corp., Clarus Securities Inc. and TD Securities Inc., to sell 44 million units of the company at a price of 75 cents per unit for aggregate gross proceeds of $33-million.
Perhaps we should ask how this sits with the "Co-Lead Underwriters" of the LAST financing on June 12 ...

Colossus Minerals Inc. (TSX:CSI)(OTCQX:COLUF) (the "Company" or "Colossus") announced today that it has closed the previously announced offering with GMP Securities L.P. and Dundee Securities Ltd., as co-lead underwriters (the "Co-Lead Underwriters"), on their own behalf and on behalf of a syndicate of underwriters which included Canaccord Genuity Corp., Clarus Securities Inc. and TD Securities Inc. (together with the Co-Lead Underwriters, the "Underwriters"), with PowerOne Capital Markets Limited acting as a selling group member, pursuant to which a total of 17,968,750 common shares of the Company ("the "Offered Shares"), including those issued pursuant to the exercise, in full, of an over-allotment option granted to the Underwriters, were issued and sold at a price of C$1.60..."

So whats our upshot this time?

Water problems are a killer and to have a massive large one foisted on unsuspecting types is real bad. Who is to say a zillion dollars will stop water engress? This ridiculous management?
This company has lost all pretense of credibility and thats an easy judgement to make as the paper instantly drops to $ .72. A body needs to avoid this train wreck and gee whiz what a call.