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MML

2.41%

85.0¢ medusa mining limited

Knowing When To Hold Em or Fold Em, page-4

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M22

8 Posts.

25/07/16

16:07

Post #: 18360652
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Originally posted by cncventure ↑

I've been quite vocally bullish on MML over the last 12 months so I feel obliged to make this post.

MML up until two or three weeks ago was by far the largest position in my portfolio as I was quite bullish about its operational turnaround, but over the last three weeks my view of the company's prospects has changed dramatically and I have since sold down 90% of my MML position...

I began selling a couple of weeks ago when Gina Lopez (the new Philippines environment minister) shut down two nickel mines, one of which was ISO14001 certified. She's made it very clear that rather than "talking tough" about shutting down mines in the Philippines she is actually doing it.

She has since shut down more mines and even said that being "environmentally certified" was no insurance from closure and that the "social impacts" mattered more to her...

That made me feel as if there is little "warning" or "due process" being applied with these mining reviews.

Up until last week it was only a few nickel mines, but late last week she publicly committed to taking away OGC's exploration license (an ASX listed gold miner). If that occurs (and I've now got little reason to doubt her willingness to act) it will likely have people rerate MML's soverign risk (if they haven't already).

Unfortunately MML is in an extremely tight spot, it's a one mine operation based in what is presently a very anti-mining sovereign. So if this woman decides that MML isn't fit for her version of what is good for her country then I suspect MML's share price will go to zero...

For me, the risk of my capital going to zero doesn't justify MML's potential upside (which I now think has already been greatly reduced anyway given that Lopez does not support open pit mining which the B1 deposit was being proposed as).

So as much as it pains me to say - I don't feel MML offers a good risk reward opportunity anymore.
I am now on the sidelines until the Philippines government finishes their audit (apparently in August) and even then I'll be erring on the side of caution from here on out in regards to MML.

GLTA

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MML Price at posting: 69.0¢ Sentiment: None Disclosure: Held
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Knowing When To Hold Em or Fold Em, page-4

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