Yesterday the company said that it will search for Lithium at its Paymaster Canyon Lithium brine project in Nevada and if no more promotions get disclosed, it should be considered that the drilling update was the reason for the 34.78% jump and the nearly 848,000 shares traded. The stock closed at $0.31, recovering within a day from the deep yearly bottom hit last week.
Over the past months an unknown third party is paying $20,000 each week to get AMEL stock promoted. As the chart shows, however, the impact is slowly but stably fading away and the share price is gradually lowering its trading range.
The mining company is in the exploration stage for six years now and has still not established any economically significant reserves. However, Amerilithium had no problem in finding investors for its unprofitable business and has raised over $6.4 million from the sale of shares in the first half of this year. From that amount around half a million were left at the end of June, the rest being “invested” in mining rights.
Unlike the mineral properties of the company, its stock obviously commenced trading on the OTC market this March with a lot of excess reserves. Having already used more than 85% of them by now, the news from the middle of October that the company has now engaged a consultant to locate and evaluate new mineral properties for acquisition did not stop the share price fall.
Amerilithium has not explained why it needs more properties after the recent acquisition, but it looks clear where the cash needed will come from. It also sounds strange that the consultant preferred to get paid with 250,000 new shares of AMEL common stock instead of cash.
