The Critical In...'s  Instablog

The Critical Investor
Send Message
If you got burned in the past at junior mining investments by overly positive newsletter writers, sell side analysts or other (paid) sources which more often than not avoid to mention (hidden) risks or critical flaws, The Critical Investor goes a few steps further, and might provide a fresh,... More
  • Colossus Minerals: It Turned Out The Poor Garimpeiros From COOMIGASP Were Right After All 0 comments
    Mar 25, 2014 7:56 AM | about stocks: COLUF

    More and more details are beginning to surface, referring to the questionable acting of (at least) initial Colossus management. I recall COOMIGASP officials claiming they were treated very unfair when Colossus management "renegotiated" their interests in Serra Pelada, and it turns out they had every right to be upset after all.

    It seems they will get their part of the claims back and more in the end. As I never ruled out a small scale operation as the high grade mineralization is confined to a very small area, they are probably better off without foreign interference of this kind.

    Looks like Sandstorm has a final impairment coming on this project.

    Taken from the sometimes controversial but always highly entertaining blog Inca Kola News:

    More Serra Pelada news (from IKN254)

    Posted: 24 Mar 2014 07:23 PM PDT

    This was my favourite bit from IKN254 out yesterday.

    Sandstorm Gold (NYSEMKT:SAND) ( may hit headwinds at the Serra Pelada gold project

    Here's one of those reports that could be in 'Regional Politics' or in 'Market Watching', because a political event looks set to affect a widely traded stock. It's also a potential for a short, because Sandstorm (SAND) ( has rallied recently after doing a great job of carving up what's left of Colossus Minerals ( (ex-COLUF) and keeping the lion's share for itself (perhaps 50% when it's all done and dusted) and winning few friends from the retail holders of Colossus who have been diluted to virtually zero. However, they may just end up holding a great big bag of nothing, because Brazil's parliamentarians have just presented a law bill to the national congress that would strip Colossus Minerals (or what's left of it) of its concession rights and hand the whole thing back to the local Coomigasp co-operative, due to bribes paid by ex-Colossus to ex-Coomigasp leaders. Here's the report (24) and here's my best translation (by the way, I've been working on my Portuguese and I'm fully happy on how this trad came out):

    The Draft Legislative Decree 1407/13, pending before the House of Representatives, would repeal the granting of the gold, palladium and platinum mining concession in Serra Pelada in Curionópolis, Para State to the Serra Pelada Mineral Development Company . The law bill would cancel Ordinance 514/10 of the Ministry of Mines and Energy .

    With the cancellation of this ordinance, according to the authors of the law bill, the rights to the mine would return to the Cooperative Mining Prospectors of Serra Pelada (Coomigasp) .

    Members signing the bill include Domingos Dutra (SDD-MA), Arnaldo Jordy (PPS- PA), Sebastian Bala Rock (SDD-AP), Zé Geraldo (PT-PA), Wandenkolk Gonçalves (SDB-PA) and Giovanni Queiroz (PDT-PA).

    According to the parliamentarians, in 2007 the National Department of Mineral Production (ANP ) granted the license to Coomigasp to mine the concession. Afterwards, as previously reported, a number of transactions by directors of the cooperative with the Canadian company Colossus culminated in the loss of almost complete control of the miners on Serra Pelada .

    So, not only may the Serra Pelada concession be stripped from its current owners, but the reason for the stripping is that Canadian executives have bribed local officials. That means the old directorate of Colossus, Ari Sussman and friends, who are now happily working away and promoting another large (and in my view overvalued) project, Buritica in Colombia under Continental Gold (

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: COLUF
Back To The Critical Investor's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »

Latest Comments

Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.