Hello Brilliant Members,
Time for a day trade play ! How about a play that is thinly traded and comes with higher chances of larger gain ?
My New “BRILLIANT” Alert is
AEXE – Aim Exploration Inc.
Aim Exploration Inc. (AEXE) is a Beverly Hills, California headquartered company with operational offices in Manila City, Philippines . Aim operates as a junior mining company focusing on global mining and exploration. The company currently has two existing projects, a 40% interest in a Feldspar mine located in the Philippines and an Anthracite coal project located in Peru. The Feldspar mine is currently producing and is undergoing upgrades for expanded production. The operation is controlled in a Joint Venture with Paladino Management & Development Corp. The Anthracite Coal project AIM owns and controls through its wholly owned subsidiary Aim Exploration Inc. is considered to be a high grade Anthracite Coal mining property in the Alto Chicama basin, in the province of Otuzco in Peru. Aim SA acquired these rights by purchasing these assets from Percana Mining Corp (Percana SA), a Peruvian corporation.
- With a nice plump 47 cent share price, and a meatier market cap, AEXE may be able to avoid the “gap trap” and deliver on the monster gain potential we all want to see.
- The stock doesn’t trade very much, and I believe thinly traded tickers have a higher chance of being capable of making a larger move.
Previous & Present Activities
The assets encompass 1,000 hectares of mining concession property consisting of three sites of 600, 200 and 200 hectares respectively. Percana SA initially acquired these properties based on indications of the presence of high grade anthracite coal. Illegal artisan miners have started operating multiple one-entry mines on the property, which further indicates the presence and mine-ability of these deposits. To verify the geology and quality of the coal, Percana SA commissioned local geologists to compile a technical report on the 1,000 hectares. Although the report yielded optimistic estimates of resources, reserves and economics, it does not meet public reporting standards.
Consequently, Aim commissioned Gustavson Associates (of Colorado, USA) to visit the site, and to recommend plans for commencing mining projects on the property. The visit occurred at the end of 2013, and the report thereof outlined a four-phased approach for obtaining an “Indicated & Measured” classification for the deposits, and for compiling a Preliminary Economic Assessment. Aim now has a 36-month operations plan that accounts for the steps recommended by Gustavson, while enabling the company to immediately commence the business of selling coal sourced from artisan miners on and around its property.
Stage I of this plan will span months 1 – 18, and will involve two main elements. The first will be formalizing an agreement with the miners on Aim’s property. The agreement will require them to sell their output to Aim, restrict their mining activities to the current area, and impose specific safety standards. The Peruvian government has instructed these groups to formalize an agreement with Aim, or to vacate the property. The company also intends to secure sourcing contracts with artisan miners on other properties in the area. The second element will be to setup a depot in Otuzco, from where Aim will service domestic customers.
Stage II will span months 19 – 24 and will also entail two main initiatives. The first will be commissioning mines operated by Aim. These mines will be setup as drilling, exploration and mine plans are completed across different sections of the property. The second initiative will be to develop a supply chain from Otuzco to the Port of Salaverry, from where coal can be shipped to international customers in the Pacific region.
Stage III will span months 25 – 36 and will build on the preceding stages by focusing on increased volume and further market development.
Anthracite coal is a highly desirable resource with a variety of uses. It is primarily used in the manufacturing of steel, the production of cement, and the generation of electricity. 70% of the steel produced globally relies on coal (World Coal Association, 2013); 200kg of coal is required to produce one ton of cement (Van Oss, 2012); and 41% of global electricity production relies on coal (Clemente, 2012). Anthracite is the highest ranking coal because it is older and harder, contains more carbon, has lower moisture content, and burns hotter than any other type of coal. Comprising only 1% of global reserves, anthracite is also the cleanest burning fossil fuel on the planet (Cornerstone, 2013).
Aim intends to sell its output to domestic and international customers. From a domestic view, Peru imports about 90% of the coal that it consumes, which indicates a strong domestic demand (EIA, 2012). From an export view, the global steel industry is the primary driver of anthracite demand. China and India are expected to comprise 50.5% of this global demand in the short-term, which makes them the highest potential consumers of anthracite (World Steel Association, 2013). China stopped exporting anthracite in 2009 in order to meets its domestic needs. Aim’s strategic proximity to the Port of Salaverry (about 200km) will enable the company to service this significant Pacific market.
Aim has a variety of advantages. The company has a team of technical experts on ground in Peru, and has also recruited advisors and directors who bring complementary skills to the venture. In terms of infrastructure, power lines run through Aim’s property, while a river runs adjacent to the site. The road network from the site to Otuzco can support 25-ton trucks. From Otuzco to Salaverry, the road is paved and well maintained, and can support up to 50-ton trucks. There are also accommodation facilities close to the property that can cater to Aim employees and contractors. Other distinct advantages are:
Competitive labour wages in Peru, and competitive storage and stevedoring costs at the port.The ability to extract deposits with minimal or no coal washing.
Aim will compete with small scale Peruvian miners, and two larger players: Vena Resources Inc. and Black Hill SAC. Given the size of the global market and the desirability of anthracite coal, the company does not anticipate that these firms will impede the success of this opportunity.
Start your DD now and as always, stay Brilliant !
Don’t forget to read my complete disclaimer at http://brilliantpennystocks.com/disclaimer/