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Investing.com -- Collective Mining Ltd. (TSX:CNL) (NYSE:CNL) stock fell 7% on Wednesday after Morpheus Research identified the Canadian mining company as a short target, citing concerns about its operations in Colombia.
The research firm alleges that Collective Mining is conducting exploration activities on untitled land without proper mining concessions from Colombian authorities, particularly at its flagship Apollo gold deposit. According to Morpheus, this target represents approximately 93% of the company’s net asset value and has driven a 285% rally in the stock price since its discovery was announced in June 2022.
Morpheus Research claims that based on its analysis of satellite imagery, technical reports, and data from Colombia’s mining regulator (ANM), "a significant portion of the company’s activities are occurring on untitled land." The report further alleges that three drill pads appear to have been constructed entirely on untitled land.
The short report also raises concerns about Collective Mining’s operations potentially occurring in environmentally restricted areas known as "riparian forest buffers," where mining activities are limited according to Colombian regulations.
Additionally, Morpheus highlighted the background of Collective’s Chairman Ari Sussman, noting his previous leadership role at Colossus Minerals in Brazil, which faced allegations of irregularities and eventually had its mining license cancelled by Brazil’s Congress in 2014.
Collective Mining, valued at approximately C$1.1 billion ($807 million), focuses on developing mineral deposits in Colombia. The company has not yet issued a public response to the short report allegations.
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