Shares of Goldex Resources Ltd. [GDX-TSXV] have gained over 164% in the last three trading sessions ending Tuesday May 29 after the company said a suspension of trading in its shares on the Frankurt Stock Exchange (FSE) was lifted on May 24, 2018.
“The company is fully disclosed of all material information at this time,” Goldex said in a May 28, 2018 press release.
On May 25, 2018, the company also announced results from a recently completed sampling program at its Korokoro gold project in Mali, West Africa. Goldex President Chuck Ross described the result as “highly encouraging.” He said a grab sample of fresh granodiorite from an artisanal mining shaft with rare sulphides and quartz veinlets assayed 26.4 g/t gold (for more details about Korokoro, see below).
These announcements come exactly one month after the company said trading of its shares on the FSE was suspended. In an April 24, 2018, press release, Goldex said a FSE notice stated that the suspension of trading was because proper trading activity was not guaranteed. Goldex did not elaborate.
However, the company said at the time, it was not aware of any material change in its affairs. It also said it would work with the FSE to resolve the issue.
Meanwhile, after reaching a high of $1.27 in early trading on Tuesday, the stock is up from 48 cents on May 24, 2018.
In spite of that gain, Goldex is still well below levels reached ($2.56) on March 20, 2018, when the British Columbia Securities Commission issued a halt trading order. Goldex is a junior exploration company with properties in Mali, West Africa and Guatemala.
On March 1, the BCSC said it had become aware that the Federal Supervisory Authority of Germany (BaFin) had issued a warning to investors about Goldex, stating that “buy recommendations are currently being issued for shares in Goldex via e-mail market letters.”
That was after the stock jumped by 77% on February 26, rising to $1.24 before losing 33% of their value two days later after hitting $1.34 on February 27.
According to the BCSC, BaFin had evidence indicating that the buy recommendations contained false and misleading information and/or that existing conflicts of interest are wrongfully concealed.
It should be noted that neither the BCSC nor BaFin have implied any wrongdoing on the part of anyone connected with Goldex, its management team or board of directors.
On February 28, 2018, Goldex said it was aware that BaFin had issued a notice stating that it has initiated an investigation into suspected market manipulation of the shares.
However, Goldex President Charles Ross said that prior to being brought to the company’s attention it was not aware of the notice and not aware of the email market letters referred to in the notice. The company is also not aware of who issued the market letters,” he said. Ross said company management is not aware of who or what was behind recent fluctuations in the trading price of the company’s shares.
The BCSC issued a halt trading order on March 20, 2018 that remained in effect until April 13, 2018. But trading did not resume until April 17.
Goldex recently signed a joint venture agreement to explore and develop a gold licensing area covering 143 km2 in Mali. Signatories to the joint venture are Geo-Sys-Tech S.A.R.L. and RexMetal S.A.R.L., Goldex said in a February 26, 2018 press release.
Goldex said GEO has the right to acquire a 90% interest in the license for 750,000 Euros, of which 350,000 Euros has been paid. It went on to say that GEO had established an exploration program over the Korokoro license area and has obtained a small-scale mining license under which it can produce up to 15 kilograms of gold per month.
Under the terms of the small scale mining license, Goldex said GEO has set-up and is operating a pilot plant capable of processing 10 tonnes/hour.
Under the terms of the joint venture, GEO and REX agreed to transfer their interests in a new company to be incorporated, while Goldex would become the operator with a 51% interest in the joint venture and the license.
Goldex said it has pledged to complete a NI 43-101 report and pay REX 400,000 Euros at a rate of 33,000 Euros per month.
“It is the intention of the joint venture to further develop the property and apply for a large-scale mining license,’’ Goldex said.
On March 19, 2018, Goldex released another update saying that the company set out to identify a project in West Africa with the potential to create the foundation for a significant gold mining company.
“The Korokoro property joint venture agreement announced on February 26, 2018 met all these criteria,” Goldex said.
It noted that Mali is the third largest gold producer in Africa and hosts several world class mines with greater than 4 million ounces of gold in resources and has a strong mining culture.
It went on to explain that the President of REXMetal is Djeneba Samake, the President of the Mali Woman’s Mining Association.
Goldex said shareholders of GEO-Sys-Tech S.A.R.L. are highly experienced miners, processors and geologists.
“With exploration drilling having been completed to a 30-metre depth, GEO’s development plan for the Korokoro property calls for a simple conventional open pit mining and gravitational processing of heavy mineral ores with a mobile beneficiation plant to enable ecological and low-cost production,” Goldex said.
The Korokoro property is located by 54 km from the Randgold Resources Ltd. [GOLD-NASDAQ, LSE] Morila Mine which has produced over 7 million ounces of gold. Other mines in the area include Iamgold Corp.’s [IMG-TSX, IAG-NYSE] Sadiola Mine.