Silver Stock Report #15

Silver Stocks–Comparative Valuations  
Weekly Report #15
by Jason Hommel
The Silver Stock Report

Friday, Dec 26th, 2003

This week’s report lists 91 silver stocks.  There are 28 silver stocks that list reserves, resources (and exploration potential.) which I calculate by using my “ounce in the ground” forumula.  There are 40 explorers.  There are 23 additional “silver” stocks with incomplete information. Additions & Changes from last week are in bold. (But simple price changes are not in bold.)

If you are an Accredited or Sophisticated investor and want information I may find out about private placement opportunities in some of the very best silver stocks in my opinion, (This is not a solicitation for any stock, and I’m not brokering any securities) email me with PP in the subject field:  jasonhommel@yahoo.com  

If you want to know which stocks I own most of, and which I own least of…  that information is in a monthly report for paying subscribers.  For a look at my personal portfolio:  I do not issue recommendations, and I don’t list number of shares or the size of my portfolio, but I will show the top investments in my portfolio, by rank, updated monthly.



To read about my religious bias, see my other website, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again.

If you want to receive an email notice of when and where this FREE weekly report is published, sign up at silverstockreport.com  Anyone who signs up will also get a FREE e-book that explains the bullish case for gold and especially silver.  If you have studied the silver market at all, then the time has come that you ought to be a teacher, and you ought to explain the silver story to all who will listen.  silverstockreport.com is designed to help spread the word. I suggest you email the url to your address book.

Price of silver is $5.76 as of Friday, 1:30 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7651  I will use .77 for ease.  

Stock Symbol / Silver oz. “in ground”** for 1 oz. silver’s worth of stock. / price change since last week relative to silver price change (and stock dilution, if any) /  additional comments (EXPT is “exploration potential”) 

1. HL                                     .50 up –current producer(gold bonus)
2. CDE                                  1.2  even –current producer
3. IPOAF.PK                          1.7  down –current producer
4. ECU.V                               2.4 up –(6.7 EXPT)  –50% gold bonus
5. GRS  GAM.TO                   2.6  even –current producer
6. MAI.V  MNEAF.OB            3  up   –just raised $6.6 mil, exploring for more silver.  (gold bonus)
   
7. SIL                                    4 even  –large zinc bonus, low grades.
8. MFN  MFL.TO                    4.1
9. * CFTN.PK                         4.9 up — (46 EXPT)
10. * TM.V  TUMIF.OB TUY     5.6 up — (11.3 EXPT) bonanza grade silver discovery late Nov. 2003
11. KBR.V                                5.6 down 
    
12. PAAS                                 5.7 up  –current producer
13. * CZN.TO  CZICF.PK          6.2 up  –large zinc bonus, high grades, low start up costs, great exploration potential
    
14. FSR.TO                              6.1 up  –current producer
15. WTZ  WTC.TO                   6.8  up   — (29 EXPT)
16. ORM.V                                7.5 up        (32 EXPT)
17. SSRI                                   9.6 up –multi-property company, understands silver story
18. MGR.V  MGRSF.PK             10.2  down
19. DNI.V                                 12.2 up  –exploring Clifton’s property.
20. ADB.V                                16.4 down –actively expanding resources. (Huge gas bonus)
21. * SRLM.PK                         14.2 up –(38 EXPT) acquired the Sunshine in Cour d’Alene
    
22. CHD.V CHDSF.PK               16.5 even   (explorer, with inferred resources)
    
23. FAN.TO  FRLLF.PK            17 even  –(29 EXPT) low grades, silver 1/3; also gold & zinc.
24. HDA.V                               17 up   –very tiny, no debt, zinc bonus, low start up costs.
25. * SVL.V  STVZF.PK            17.3 up  –(32 EXPT) –(Silver in Honduras) acquiring silver properties.
26. * EXR.V  EXPTF.PK           18 even  –significant zinc bonus 60% zinc, 25% silver
27. ASM.V  ASGMF.PK            20 up –owns 49% of the Avino mine. + 4 other silver props. (silver bonus)
28. * MNMM.OB                      24 up  –60% copper bonus (low grades), start up ~ $250 mil
29. UNCN.OB                           30up  –lease expiring on largest property in mid 2004.

* = I own shares

Explorers (by market cap):

1. III.TO  IPMLF.PK
2. FCO.TO FCACF.PK
3. * CDU.V  CUEAF.PK 44-72 “exploration potential”
4. * AOT.V ASOLF.PK — owns percentage of Cardero, CDU.V
5. MCAJF.PK
6. IMR.V  IMXPF.OB
7. TVI.TO  TVIPF.PK –current producer of a dore silver bar 96% silver, 4% gold
8. EZM.V  EZMCF.PK
9. CAUCF.PK
10. MAG.V
11. * NPG.V  NVPGF.PK 29-147  “exploration potential”  (owns 1 silver property, 10 gold properties)
12. MMM.TO
13. * OTMN.PK 135 “exploration potential”
14. * MMGG.OB –zinc/silver (historic high grade silver) (low cost revolutionary oxide zinc process)
15. IAU.V  ITDXF.PK
16. SML.V SMLZF.PK
17. EXN.V
18. NBG.V NBULF.PK   21 – 60 “exploration potential” 
19. SDR.V  34-115 “exploration potential”
20. MAN.TO  MMALF.PK –Protests in Peru, and Peru revoking the property rights, hurt the price.
21. BCM.V  BCEKF.PK
22. EPZ.V  ESPZF.PK
23. QTA.V  QURAF.PK
24. NJMC.OB
25. HGM.V  HOGOF.PK
26. * GNG.V  GGTHF.PK –Historic silver district in Mexico
27. CHMN.PK
28. * KRE.V KREKF.PK
29. MMG.V  MMEEF.PK
30. BGS.V
31. SPM.V
32. SHSH.PK
33. * CEV.V CVEEF.PK
34. LEG.V
35. SRY.V
36. FR.V
37. BBR.V
38. TUO.V TEUTF.PK
39. ROK.V
40. CBP.V CPBMF.PK

* = I own shares
** = “in ground” counts all “silver oz. in the ground” as the same, but they are NOT EQUAL.  Some are more certain and others are more speculative.  Some are higher grades, some are lower grades.  They range from most certain to least certain such as: “proven & probable reserves,” “measured, indicated, inferred resources.”  This single number next to each stock symbol above represents the approximate number of ounces of silver in the ground you are buying title to when you invest the equivalent of one ounce of silver by buying shares in the company at current prices.  (It does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.)

At goldsheetlinks.com, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources.  I don’t do that.  I count them as all the same.

To quickly “tab” down to the company you are interested in, note the symbol. Then hit “control-F” to “FIND” the symbol below. 

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WEEKLY COMMENTARY (All new in this section):

On Dec. 16th, James Grant wrote for Forbes Magazine, “The Case for Silver“.  He wrote that the main reason to be a silver bull is the potential monetary demand, and he noted the difficulty of finding silver, and the ease of printing up more paper money.  He noted the supply-and-demand charastics for silver are excellent, with industrial demand outstripping supply for the past 13 years.  Those are the two biggest factors for silver, and I’m glad the article pointed them out.  Supply is less than current demand, and there is currently no monetary demand, and there potentially could be an avalanche of monetary demand.  When it hits, the price will be driven sky high.  You can make a bullish case for other commodities, but zinc will never have monetary demand like silver will.  Unfortunately, there was no comparison made between how much money exists, and how little silver exists.  But he did write that there is perhaps $5 Billion dollars worth of silver available to market (one billion oz.), at the most.

An interesting point mentioned in the article was that Fleckenstein, a director of PAAS, estimates that there are perhaps 20 Billion oz. of silver in “above gound silver stocks”, but that 2/3 of that is unavailable at current prices, and is not liquid. 

For example, if a consumer buys a silver ring for $10 that contains less than 1/5th of an oz. of silver, the consumer is paying $50/oz. for the silver, and a rise in price anywhere below $50/oz. is not going to get that buyer to sell the silver–for there would be no profit in doing so.

I have read that the historical production of silver in all of history is 40 Billion oz.  Most of that has been consumed by industry, or jewelry demand, and is no longer available to the market at current prices.  I figure that 40 
Billion is a reasonable number, given the 4.6 Billion oz. estimate for world historic gold production, and just under a 10:1 production ratio.

Ted Butler writes that silver has been consumed by industry for the past 50 years or more, and I agree.  Although the current silver deficit has been continuous for the past 14 years, the surplus was very brief, and there were deficits going back further.  If, on average, industry has consumed 1/2 a billion oz. annually for the past 60 years, that would consume 30 billion oz. of silver, and therefore, there is not much left.  

————

For Christmas presents for family and friends, I wanted to buy about $1000 worth of silver bullion from a local coin dealer this week.  This is a very small amount.  In fact, this is the smallest amount you can buy in California without paying sales tax.   Much to my surprise, the dealer in Grass Valley did not have any silver.  And neither did the dealer in Auburn.  Neither one had any silver in inventory at all, except for a few silver dollars for show.  Shame on them for not being able to service their local customers!  Shame on them for not understanding the silver story, for if they did, they would keep their money as silver in the vault, instead of paper cash in the bank!  

Each had the lamest excuse for not having any silver inventory on hand.  The guy in Grass Valley said that he had to pay his bills in cash.  Ridiculous!  Of course he does.  But this is still no excuse for converting all his savings over to the local fiat “funny money” currency!   The other lady in Auburn said it would be too risky having silver bullion on hand, due to the risk of theft!  Ridiculous!  She had a $2500 safe standing right behind her, yet did not have $1000 in silver bullion on hand in inventory? 

Don’t just believe me.  Call them up.  See that they carry no silver bullion inventory–as a matter of policy! 
Security Gold Exchange, Inc., (530) 272 1810, 104 Mill St., Grass Valley, CA 95945.  
Gold Country Gold Exchange, 2428 Grass Valley Hwy, (530) 885 9050, Auburn, CA 95603.

The largest “local” coin dealer that I know of is in Sacramento, over an hour away.  William (Bill) Dunbar of Marconi Coin & Jewelry Exchange is said to be the largest dealer in Sacramento with the best prices, as reported by the other dealers in the area.  I believe it.  Nevertheless, Bill usually only has a bag or perhaps 3 bags of junk silver bullion in inventory at any one time (if he’s not sold out, which happens frequently). A “bag” is $1000 face value, worth about $4000.  He says he can get more, whenever, and that he could order however much I want.  Of course.  That’s the same promise every bank makes.  But on the day of reckoning, it’s how much he, personally, has in the shop on that day that really counts. 

The other “big” local coin dealer I know of is in the Bay Area, who services the Menlo Park / Atherton neighborhoods of the San Francisco Peninsula.  Atherton is one of the richest zip codes in the nation.  I’m sure you have heard of 90210, that TV show?  Rich, right?  Atherton is richer.  Nevertheless, at this store, it’s about the same story.  Usually, they only have 1-2 bags of junk silver in inventory at one time.   

Do you find this amazing?  I do.  One small customer can literally clean out several coin shops in Northern California, and not even break a sweat.  The only thing more amazing than the short supply is the lack of demand.  There is literally nothing available, and the coin dealers do not care, because they have no customers!  How do they stay in business?  Selling 1 oz. silver commerative or special occasion rounds for $10 each, I suppose.

Speaking of staying in business… there are thousands, perhaps multiple thousands of businesses that rely on silver, tiny bits of silver in electronics, and for them, there is no substitute.  For them, they must have silver, or otherwise not produce their products, and go out of business.  It will be “buy silver or die”.  A silver shortage is unthinkable for them.  They will pay any price.  The whole world will wake up, and realize the flaw in the Japanese style of “just in time” inventory practice.  A supply of inventory is a protection.  A supply of silver is a double protection, it also protects against the falling dollar.  When the silver shortage hits, due to the excessive short selling, and when defaults hit, the price will skyrocket.  Since there is more industrial demand than mine supply, there must be a bidding war for the silver that will remain in the hands of investors who bought it first.  And more investors will join in the insane bidding war that must be the result.  All the lazy thinking and lazy acting investors who lack the courage to buy until the price begins rising will go crazy to buy whatever they can when silver crosses $7/oz. or heads past $10/oz.  And what will they discover?   The same thing I discovered this weekend.  There IS NO SILVER AVAILABLE.  Where will they go to buy it?  The coin shops are out, and COMEX will be in default.  Where will people go to get silver?    

Don’t believe me?  Call the dealers mentioned above.

Right now, I only know of a few bullion dealers who can fulfill “larger” orders at a relatively good price.  But large is relative.  These guys are happy to get the rare $100,000 order, but that’s not going to satisfy the Trillions of dollars that can, in theory, try to buy silver.  

For a list of bullion dealers:
The Silver Stock Report

At Christimas dinners, I had a wonderful time discussing the merits of owning gold and silver bullion with family and friends.  Writing this page has helped me to remember some of the key data which provides the irrefutable case for owning silver.  The point that I felt had the greatest validity (and which most impressed the minds of the listeners, who remembered, and repeated this back to me several times), was the following point, which is rarely presented by anyone else:

Long before 1% of U.S. paper dollars tries to buy gold, gold will be going up well over $1000/oz., and silver will be headed up over $50/oz. 

A little further below, you will find the facts and figures which back up that statement:

General Commentary on Silver (slightly modified from last week):

Let me say how important it is for silver stock investors to own physical silver.  There is $364 million dollars worth of silver at the COMEX.  The 59 silver stocks on my list, for which I have information available to calculate market caps, add up to $7090 million as of Dec. 5th, 2003.  If silver stock investors move 5% of their silver stock holding to physical silver in the next few weeks, that would be $350 million dollars worth of physical silver, and thus, the silver price would probably hit $10-20/oz. within a few days.  And if silver stock investors try to move 20% into physical silver, the silver demand will end the COMEX manipulation tomorrow.  We don’t need anyone other than ourselves to make “the big breakout” happen at this point.  

Two weeks ago, I wrote an article predicting that Silver Companies will buy silver, and urging Silver Companies to buy silver with their cash, to use silver as money, and sell silver as needed for expenses.  See http://news.goldseek.com/GoldIsMoney/1069879327.php

That article is now having an effect!  It is being discussed by several large “cash rich” silver companies, who are seriously considering the idea of holding their cash in the form of silver.  

All 90 silver stocks on this list, on average, were up 238% for the year, since 1-1-03.  I believe that beats any sector, and any mutual fund in the world for 2003.  Anyone know of a better sector or fund?  Yet silver stocks are completely off the radar of TV financial news coverage. The stealth bull market continues!

A great overview on silver: Douglas Kanarowski’s 78 Approaching Forces For Higher Silver Prices

Look at the summary of the world silver survey:
http://www.gfms.co.uk/Publications%20Samples/WSS03-summary.pdf

Note, there is virtually no monetary demand. Note, the 2002 mine production (585 mil oz.) is greatly exceeded by industrial, photo, and jewelry demand. (838 mil oz.).  Note the chart on page five, “Supply from above-ground stocks”.

The difference between mine supply and industrial demand was met by a combination of three factors: 1.  Government selling, 2.  Private selling, 3.  Recycling

U.S. government selling is ending, as their stocks have run out, or will run out.  This factor will reverse, because the U.S. government will need silver to continue their coin program, and/or need silver when they wake up and decide they need to replenish their strategic stockpile for domestic security.  Silver is a war material.  China’s selling of silver will also likely turn into buying, as China will need silver for continued industrial development, or when they also lose faith in the U.S. dollar.

Private selling has been rapidly shrinking and is now almost ended, and should turn into buying, and become monetary demand.  Monetary demand is everything in the silver supply / demand situation.  It’s not now.  Now, it’s nothing.  But it will become something incredible, because the dollar is dying.

The following is a “must read”:  Ted Butler’s best ever explanation of how silver is manipulated lower than it should be.
http://www.investmentrarities.com/11-04-03.html

Sign the silver petition to stop the manipulation at the COMEX:
http://www.PetitionOnline.com/comex/

Ted correctly points out that a lower price creates excessive demand from consumers.  However, Ted Butler does not point out, and neglects to mention, that a perpetually low price also creates lack of demand from investors who are “trend investors”.  

I think most silver experts over-analyze all the supply and demand factors of the silver market.  No factor is more important than monetary demand.  The force of photographic demand is like a light breeze compared to the hurricane or tornado of monetary demand.  Monetary demand is everything.

Consider the gold market for a moment:  Even short selling at the COMEX is nothing compared to monetary demand.  The short position most certainly helps to depress the price of gold as the short position is growing larger.  However, it adds fuel to the fire if there is short covering, and thus, it can boost the gold price later.  But the commercial short position on the COMEX is next to nothing compared to the non-reported “over the counter” trading that is done that does not appear on the COMEX.

(Numbers in metric tonnes, 32152 oz. per tonne.)

870 tonnes — the paper position at the COMEX, 280,000 contracts for 100 oz. each.
5000 tonnes — the official number admitted that the central banks have sold.
15,000 tonnes — the number GATA research shows that central banks have sold / or leased.
30,000 tonnes — the number of official central bank gold, minus either the 5000 or 15,000 tonnes.
145,000 tonnes — all the gold mined in the history of the world.
2600 tonnes — annual mine supply
4000 tonnes — annual demand

And all of that is nothing compared to the amount of dollars out there that exist that could buy gold. $20 trillion bonds, $9 trillion M3 = $29 Trillion.  A mere 1% is 290 Billion, which, at $400/oz. is a massive demand of 22,549 tonnes.  Do you understand what that means?  That means that far, far less than 1% of dollars, in either bonds or M3 can buy gold, because there simply is not that much gold available.  

Long before 1% of U.S. paper dollars tries to buy gold, gold will be going up well over $1000/oz., and silver will be headed up over $50/oz. 

To scare away investors–that is the entire reason gold and silver is manipulated in the first place.  Only the trend investors can be deceived.  The problem is that nearly everyone is a trend investor.  So few investors understand value.  If people knew the facts and used their brains, the available above-ground refined silver would be gone by tomorrow, and the price would be well over $20-50/oz.  But don’t trust me, follow the urls and check the numbers:

    1,000,000,000,000: 1 Trillion dollars
          1,000,000,000: 1 Billion dollars
                1,000,000: 1 Million dollars
$33,000,000,000,000: World bond market yr end, ’01:  http://tinyurl.com/vr7u
$20,200,000,000,000: U.S. bond market, yr end, ’02:  http://tinyurl.com/vr7g
$11,700,000,000,000: U.S. stock market, yr end, ’02:  http://tinyurl.com/vr7g
 $11,038,000,000,000: U.S. annual GDP, 3rd q.’03 est.  http://tinyurl.com/vr9y
  $8,835,000,000,000: M3 (money in the banks) Oct. ’03  http://tinyurl.com/vra0
  $6,939,572,558,142: US debt, 12-4-’03  http://tinyurl.com/bbp
  $2,212,000,000,000: U.S. annual budget 2003 
  $1,860,000,000,000: World gold, 145,000 T @ $400/oz. http://tinyurl.com/vrcc
     $554,995,097,146: U.S. budget deficit, ending fiscal year, 09/30/’03  http://tinyurl.com/bbp
     $274,000,000,000: Market Cap of Microsoft  http://tinyurl.com/vrcn
     $180,000,000,000: debt of Ford Motor Co. http://tinyurl.com/vrd1
     $104,400,000,000: US gold, 261 mil oz., @ $400/oz. http://tinyurl.com/vsr9
     $100,000,000,000: all the world’s gold stocks (estimated?)
         $7,090,000,000: all the world’s silver stocks (59 of them on this list, as of Dec. 5th, 2003)
           $353,000,000: 62 mil oz. of registered COMEX silver @ $5.70/oz.  http://tinyurl.com/vrcw

So, what do all those stastistics mean?

For a while I was using M3 and dividing that by the US gold (261 million ounces), which implies the us dollar is 84 times more valuable than it should be, and that gold should hit $33,850/oz. after the fraud is destroyed.  Today, I realize I need to add in the Bond market, because bonds are an asset class designed to siphon away and replace real money, which is to say, gold.  This gives a price of $111,111/oz. for gold.  At $400/oz, this implies that US bonds and paper currency is 278 times more overvalued than gold.

Gold is overvalued relative to silver, because at current prices, it takes 75 ounces of silver to buy 1 ounce of gold.  Historically, this ratio was 15 or 16.  Given the silver shortage, this ratio will hit 10:1 or 5:1, or even 1:1.  Thus, gold is perhaps 75 times more overvalued than silver.

Silver is overvalued relative to certain select silver stocks, perhaps by a factor of 3 or 10 or 20 to one. 

Thus, if you multiply all those numbers, 278 x 75 x 20,  You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 416,666 to one. In other words, if silver stocks reach their true value, and paper currency disappears as it always does, then you might expect certain silver stocks to go up in relative value by a factor of 416,666 times more than they are worth today.  By that time, you should definitely sell the silver stocks, and buy gold.

Can silver stocks really appreciate so much? Is there historical evidence for such a crazy thing?  Yes. 

See http://www.sterlingmining.com/old.html
Excerpt:
“CDE rose from penny stock status (.02 in 1967) to an NYSE-listed, $60 per share stock in 1980. In fact, the average share on the Spokane Stock Exchange rose in value nearly 16000% (yes, sixteen THOUSAND percent), as America could not get enough of silver and silver stocks.”

CDE rose by a factor of 3000, or 300,000%, and by 1980, the metals boom was stopped short, and paper money’s death was postponed.  If paper money dies a death that lasts a generation world-wide, then even greater gains should have been expected.

For this reason, a wise silver stock investor should NEVER sell silver stocks for paper cash.  A wise silver stock investor who looks for value would never sell a fairly valued silver stock for an overvalued silver stock that traded for hundreds of thousands of times more value than it should be.  Likewise, there is no excuse for a silver stock investor to have any cash or money market or bonds in his portfolio for any reasonable length of time, except for when selling one silver stock to raise the cash for another silver stock, or for when you need to raise the cash to buy silver, or a private placement in another silver stock.  

So, if you want some fairly liquid alternatives to cash, in case you don’t know what other silver stocks to buy at the time, here they are:
1.  Buy silver.  You can hold silver in an IRA.
2.  Buy CEF.  Central Fund of Canada, ticker symbol CEF.  It’s gold/silver bullion fund.  It has 50 oz. of silver for every 1 oz. of gold.  The fund is fairly liquid, you can buy it as easily as any other stock, and is a good cash substitute.  Unfortunately, given the current ratio, about 60% or more of the value is in gold.
3.  Buy a fairly large cap silver stock, with fairly large volume, that is still fairly cheap on the list.  SSRI is probably the best candidate, the next might be PAAS.  

———-

The sheer stupidity of big money not recognizing the value of the world’s remaining silver is utterly shocking to the rational mind.  Clearly, bond holders are utterly deceived, and totally unaware of the situation.  All my readers should understand and know that bonds were originally invented to suck the capital and money (gold and silver) away from the people.  Bonds today are a paper promise to repay paper.  What a con game!  Are bond holders conservative and safe?  No, they are fools!  There is nothing safe about holding a paper promise to receive more paper when we have been experiencing hyperinflation for the past two and a half years!  

See my prior essay, “Inflation & Deflation During Hyperinflation” 

And the fund investors who buy paper silver futures contracts instead of real silver are a very odd bunch of fools, for they should realize that nobody can deliver the 800+ million ounces of silver promised in the paper contracts and options that does not exist.  It’s like the paper longs are betting on the bank run happening, but they all are making sure they get at the end of the long line.  Instead, they could go front and center, where there is an open window available where you can go and get physical silver, and nobody is there.  Idiots!  If you know a bank run is going to happen, and you are actually willing to bet on it, then go and withdraw your money before it is too late!  Don’t bet on it happening, which, if it does happen, your contracts will be defaulted on!  Amazingly blind idiots.  Wake up!

See also my prior essay, “The Moral Failures of the Paper Longs“

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How bullish am I on silver?  Here’s an interesting way to put it: “75 times infinity” dollars per ounce. 

I believe the dollar will eventually be destroyed, likely within my lifetime, hence the “infinity” part.  I believe the ratio of silver to gold may be equal during a spike, when the market realizes that above-ground refined silver is more rare than gold.  Thus, silver may outperform gold by a factor of 75 times better.  Currently, the ratio is 75 ounces of silver can buy one ounce of gold or 75:1. 

I may end up selling silver for gold, some at the 10:1 silver to gold ratio, some more at 5:1, and I would sell any silver remaining at a 1:1 ratio, that we may hit during a supply/demand crunch during a paper money collapse.

How we can tell if silver is leading gold, or if gold is leading silver?  IE, which is going up more, faster than the other?  The way you can tell is by looking at the ratio.  If the silver:gold ratio is going up (say, from 75:1 to 80:1), then gold is moving up faster (because it takes 5 more silver oz. to buy an oz. of gold.  If the ratio is going down (from 75:1 to 70:1), then silver is moving up faster.  So, keep an eye on the ratio. 
 
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For a list of Brokers that handle Canadian issues and/or pink sheets:
http://www.bibleprophesy.org/SilverStockExtra.html

To track the 130 ticker symbols of the 90 stocks on this list at yahoo:  (updated this week)
http://www.bibleprophesy.org/SilverStockExtra.html

To learn All about Canadian law, 43-101, about reserves and resources:
http://www.bcsc.bc.ca/Publications/mineral_projects_sept03.pdf
————-

This is a list of primary silver stocks.  

I count a company’s ounces of gold as 10 oz of silver. Why? Because I have a very strong positive bias in favor of silver over gold. 

Given my bias in favor of much, much higher silver prices, then, to me, the grades of silver are far less important than buying more oz. in the ground.  More oz. in the ground at a lower cost is the most important consideration for me.  

My method is simple. Cost per ounce in the ground. How much do you get (silver reserve totals), and how much does it cost (market cap)? The cost is the market cap divided by the silver reserve totals. Cheaper is better. Buy low, sell high.

Disclaimers, Warnings, and Advice: I have gathered the information below over the course of several months. I believe it is accurate to the best of my ability. I may have made mistakes. I probably did. I’m human. I have collected the information from public sources such as company web sites and public information found at yahoo.com to get the stock prices. This report in no way guarantees the accuracy of the information below, since the information may change at any time. The number of outstanding shares can change as a company engages in new share issues to raise more capital through private placements, or if outstanding warrants (and options) are exercised and converted into shares, or if shares are bought back. Shares can be consolidated, or split. The number of ounces of silver in the ground can also change, as these are often only estimates. The number can also change up or down, depending on drilling results.

This report is not investment advice.  This report contains information that may or may not be up to date, and may be inaccurate.  I urge you to contact the company and do your own research to verify the information contained in this report.

This report is not an offer to buy or sell any securities.  I am not a broker.  Only your broker can buy or sell securities for you.

I urge you to consult with your investment advisor to determine whether these kinds of investments are right for you.  

I also caution you to be aware of your investment advisor’s advice, they are sometimes paid to push things like mutual funds, bonds and other securities that may not be in your best interest to buy.  Some investment houses are short physical metal, and thus, they may attempt to strongly discourage you from buying precious metal or precious metals investments.  I believe that the propaganda machine in support of frauds such as bonds and the dollar is so strong, that they may even believe what they say when they give bad advice to avoid the safety and protection of precious metals.  It is most likely that they simply do not understand the precious metals market as well as you do.

All total estimates of “ounces in the ground” can vary widely. There are “proven and probable reserves” which are the highest category of certainty which is obtained through many drill holes, and then at the least accurate, there are “inferred resources” which are hardest to estimate. Additionally, every miner always has “more silver properties that need to be explored, which probably contain more silver”. For the purposes of this report, I have added all those numbers together. It is believed that all these “ounce in the ground” estimates can be profitably mined at $5-6 per ounce silver, or lower. Thus, I believe that when silver trades for $15/oz. or above, that all of these ounces can be mined at a substantial profit. 

I may be wrong. (I probably make mistakes in every article, and there have been updates and corrections made each week, especially as prices change.)

Mining is a risky business. You need to be willing to sustain a total loss of your investment for various unforeseen accidents. Silver stock companies can do stupid things to shareholders such as take on debt, or issue more stock at too low prices which reduces the percentage of the company you may own (dilution). Yet, they need to issue shares to raise capital for drilling, and then an even bigger dilution to build a working mine. They may sell YOUR silver too cheaply, or worse, hedge the price of YOUR silver just as it begins to go up if they lock in a price which then proves to be too low if the dollar is destroyed. Mining is a risky business as estimates of assets in the ground can change. There is political risk and environmental risk. They can’t franchise the business, are stuck in one location, are subject to government confiscation, or taxes, or union wage negotiations, and corporate looting.

Do your own research.  Be responsible for your own investment decisions.  Again, please, before investing in a mining company, call up the company, and speak either with the CEO or the Investor Relations contact person. 

So, at the very least, check the company web site, read the annual reports, check my numbers, check my math, and email the company. That’s what they are there for, to answer your questions, and to speak about the opportunity of the company. Don’t trust everything you read over the internet. I am a biased source. I own silver mining stocks. And I’m not a broker, nor an investment advisor. I’m just a private investor trying to make sense of this crazy world, and sharing my information and thoughts on silver companies. 

Surely, there are scammers in the mining industry in the past, and there will be scammers in the future.  Remember the fraud of Bre-X.  The new 43-101 compliance laws put in place after Bre-X will not prevent a “certified” geologist from lying if he feels lying will create a better payoff.  The Bible warns, “trust no man”, yet at the same time advises us to “cast our bread upon the waters”, and to not issue “false allegations” against others.  Physical gold and silver provide the “payment in full” as long as the coins or bars themselves are genuine and not fake. 

This report may be copied, and transmitted by other people, and may become outdated by the time it reaches you.

I can’t tell you how you should invest your money, of course. The reason is that I don’t know how convinced you are of the silver bull market, nor do I know how soon you will be needing the money back, so I don’t know how long you can wait to see results, nor do I know how much liquidity you need. Nor do I know the size of the money you have to invest. It is very hard to invest large quantities of money in a small market cap stock. 

That being said, my investment strategy seems to be working for me, so far. And so, here is how I have valued the following silver companies to make my own investment decisions. 

(Market cap is always converted to US dollars and denominated in US dollars because I divide by ounces of silver, which are also denominated in dollars)

(These first three companies, BHP, GMBXF.PK, and BVN  produce a lot of silver, but are way to expensive to buy for the silver exposure for your portfolio.)

BHP Billiton Ltd (BHP) 
http://www.bhpbilliton.com/
–‘produces 40 mil oz. silver annually from one mine’
Additional comments:  unfortunately, BHP has a 49 Billion market cap, so we can’t buy BHP for the “silver exposure”.  IE, $49 Billion / oh, say, 1000 million?????= $49/oz.

Dear BHP:  By all means, keep mining the silver if you want the silver exposure, and want to be in the silver business.  But don’t sell the silver.  Keep it.  Let the profits of your entire company accrue as an increasing physical supply of physical silver.  In fact, do as Buffett did, and buy more silver if you can.  It would be infinitely easier for you to buy silver from yourself than it would be to buy 40 million ounces of silver from the COMEX, which, today, might be impossible.  

Grupo Mexico SA de CV (GMBXF.PK)
http://www.gmexico.com/indexi.html
“Grupo Mexico ranks as the world’s third largest copper producer, fourth largest producer of silver and fifth largest producer of zinc.”

Compania de Minas Buenaventura SA (BVN)
Minas Buenaventura 
NYSE:BVN
– Peru´s largest publicly traded precious metals company 
–produces over 10Moz of silver per year
–looks way too expensive for the silver alone: 3.6 Billion market cap.
————–

HL
http://hecla-mining.com/
hmc-iofo@hecla-mining.com (208) 769-4100
110 mil shares 
@ $7.83 share 
$865 million Market Cap (MC)
near zero debt, cash: $125 mil (Nov. 2003)
(est. 2003 production 9 mil oz. silver) 
(the La Camorra gold mine, 412,000 oz gold.) … (x 350/5 = 28 mil silver equivalent oz.)
San Sebastian silver mine, (proven & probably reserves) 8.7 mil (produced 3 mil)
the Greens Creek silver mine (proven & probably reserves) 31 mil (produced 3 mil)
the Lucky Friday mine (proven & probably reserves) 14 mil. (produced 2 mil)
Total silver = 53.7 million oz.
Plus 412,000 oz. gold x 10 = 4.1 mil oz silver equiv.
Total silver equiv. reserves = 57.8 mil oz.
(Since my method values silver in the ground as a key asset, I should also value the cash as a “silver asset” which will be “marked to market” if silver goes up, and cash goes down.  If HL is smart, they should be able to turn the cash into increased “silver exposure” either through buying silver properties, silver equities, or physical silver.)
($125 million cash /5.76/oz = 21.7 mil “silver equiv” oz.)
21.7 + 53.7 = 75.6
$865 mil MC  / 75.4 mil “oz.” = $11.47/oz.
You get “approx” .50 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: HL has more oz. than listed in the “proven & probable” category used in this calculation. Vein mining makes reserve calculations difficult, and HL has rarely had more than about a 3-4 year picture of reserves ahead of them in 100 years of production.   

I have been counting their papar cash as if it could be silver, but it still does not help boost their valuation much.  They are still the most expensive company on the list.  But if HL bought 22 mil oz. of physical silver, they might break the back of the silver market, and significantly boost their own profitability. 

Another way to check the value of HL is too look at profit, since they are active miners. They mine 9 million ounces of silver a year. What’s the profit on that today? Very little.  I think they had a loss in the 3rd quarter.  Total “cash costs” are $3.68/oz. (It’s that low because that figure includes gold credits!) Profit at $5.76/oz. is $2.08/oz x 9 mil oz. annual production = $18.7 million annual profit. That gives a PE of 46. That’s a very high P/E, which means HL is very expensive. 

Why does HL hold $125 million dollars worth of cash at the beginning of a bull market in silver?  It makes no sense to me.  Cash is trash in inflation.  They should be buying physical silver, or, use that cash to buy other silver resources in the ground, like the undervalued silver stocks. 

OK, here’s another way to get a “guesstimate” of HL’s reserves.  I will assume they have enough silver to last another 20 years of mining.  That’s a fair enough time for a mine plan I suppose.  I suppose they could run out of silver sooner, or later.  They produce 9 mil oz. in a year.  9 mil oz. x 20 years = 180 mil oz.

$918 mil MC / 180 mil oz. = $5.1/oz.  HL is still expensive, no matter how I run the numbers.  

And in 3 months, nobody has been able to rationally justify this high valuation to me, nobody from the company, and not a single email from any investor.  I believe that this stock trades on market perception, reputation, and momentum.  As for me, I’m not buying such intangibles. I’m buying silver in the ground, real assets, or exploration potential.

CDE
http://www.coeur.com
coeurir@coeur.com (208) 769-8155 or (800) 624-2824
210 mil shares (Issued 32 mil new shares late Oct. 2003)
@ share price $5.30
$1113 mil MC
cash $38 mil (I think this is outdated cash figure)
San Bartolome (Bolivia) reserves 146 mil silver
Silver Valley Silver reserves 32 mil silver
Rochester reserves 43 mil silver
Cerro Bayo reserves 3.7 mil silver
Total: 224.7 mil silver
(to Produce 14.6 mil oz. silver in 2003)
$1113 mil MC / 224.7 mil oz = $4.95/oz.
You get “approx” 1.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: CDE announded their intention to try and raise $150 million in the capital markets by issuing shares.  

http://biz.yahoo.com/prnews/031211/sfth014_1.html

CDE continued to lose money in third quarter 2003, a loss of 10 cents/share, and they realized low prices for silver sales, $4.77.  I believe they have hedged their gold production at low prices. 

Again, their listing of ounces is in the “reserves” category (more certain) not the “resources” category, which is less certain.  They probably have “resources” but like HL and Industrias Penoles, they give no estimates.

CDE and HL moved up in price significantly for the 3rd week in a row.  Most likely due to new investors who know very little about how overpriced these two NYSE listed stocks really are, but all they may feel is that “silver stocks will outperform silver”.  But I don’t think there is any reason for CDE and HL to continue to outperform silver from this point at today’s stock prices.  The johnny-come-latelies who bought these stocks last week will get some benefit, but not as much as if they had done their homework, or bought physical silver, in my opinion.

Another idea I’ve had is that if CDE and HL are the most expensive silver stocks, and if they are flying, then that means that there is serious new money coming into the silver market sector.  This is very bullish overall for the rest of the shares in my opinion.  New money entering the silver sector is!a sign we need to see if silver is going to have monetary demand for silver, which will really make the silver sector begin to run.

Now, if we can only get CDE and HL investors to get those two companies to buy physical silver, we will really see the beginning of a bull run in silver.  (In other words, the silver bull has barely even started compared to where we are headed, in my opinion.)

IPOAF.PK
http://www.penoles.com.mx
397.5 mil shares outstanding (2002 annual unchanged since 2001)
@ $3.50/share
$1,391 mil MC
419 proven and probable reserves of silver (from 2002 annual report on website)
$1,391 mil MC / 419 oz. silver = $3.32/oz.
You get “approx” 1.7 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Industrias Penoles is the world’s top producer of refined silver.  They actually derrive more revenue from silver than any other source.  But they lost money in 2002.  

78.5 million oz. silver refined by the metals division in 2002, and 1 mil oz. gold.
They probably refine almost all the silver that comes out of Mexico.
They probably produce about 34 mil oz. of silver from their mines annually, and they have expansion plans.  

I think Industrias Penoles should stop mining silver if they are doing it at a loss.  Basic econ 101, right?  Don’t engage in uneconomical activity.  Perhaps they have a small gain this year with improved prices?  Regardless, they should realize that silver in the ground is an asset, and also that silver in the hand is an asset.  If they do make a profit, I hope they decide to keep the form of their profits in silver, or at least, pay out a dividend in silver.

I’ve heard this stock is tightly held, most is family owned.  

Their oz. numbers are “proven & probable reserves”, which is much more certain than most of the others which are mostly “inferred and indicated resources.”  They undoubtedly have “inferred and indicated resources” in addition to the “proven & probable reserves,” I just could not find any info on that at the website or in the annual report.

ECU.V 
http://www.ecu.qc.ca/indexen.html
ecu@ecu.qc.ca (819) 797-1210
fully diluted shares = 103.3 million (6 January 2003)
@ Share price .25 CAN x .77 US/Cdn = .19
$20 mil MC
http://www.ecu.qc.ca/reservesen.html
See the url above for the numbers from the company’s website, which are:
Proven & Probable & Possible: 7.6 mil oz silver, 93,000 gold. = 8.5 million “silver equiv” using my method of counting gold as 10:1
“Potential” total: 21.2 mil oz silver, 221,000 oz. gold.
According to my valuation method, that’s 2.2 mil oz. of “silver equiv” for the gold, plus the 21.2 mil oz. silver, for a total of 23.4 mil oz.
$20 mil MC / 8.5 mil oz. silver equiv. = $2.34/oz.
$20 mil MC / 23.4 mil oz. silver equiv. = $.85/oz. –exploration potential
You get “approx” 2.4 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential: 6.7

See also regarding ECU’s exploration potential:  http://www.ecu.qc.ca/indexen.html

Additional comments: ECU recently recovered title to properties that were in dispute.  See: http://tinyurl.com/x691

GRS / GAM.TO 
http://www.gammonlake.com/
gammonl@sprint.ca (902) 468-0614
fully diluted 52 mil shares
@ share price $4.24
$220 mil MC
http://www.gammonlake.com/Sharholder_message.htm
“With the drilling of over 179 holes totalling over 33,700-metres, the resource calculation contains 761,000 gold ounces and 38.2-million silver ounces in the measured and indicated categories and a further 925,000 gold ounces and approximately 45-million silver ounces in the inferred category.”
Total gold: 1.7 mil oz. x 10 = 17 mil silver equiv.
Total silver: 83 mil oz. 
Total silver equiv = 100 mil oz.
$220 mil MC / 100 mil oz. = $2.20/oz.
You get “approx” 2.6 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  At current prices of a 70:1 silver:gold ratio, about 58% of the company is in gold, 41% silver.  Gold equiv oz. is about 3 mil oz. total.  Cash cost is $85/oz.  Life of mine is 7 years.  At $385 gold, should produce $900 mil oz. profit over the life of the mine. Not bad for the current $182 MIL MC… even though the “silver in the ground” cost is currently high.  Therefore, my valuation method undercounts the gold componant, and undercounts current producers.  But that is intended, however, because I believe silver has over 7 times the potential as gold.  My comparison method does not say that the companies that cost more can’t bring a reasonable profit to the shareholder.  My comparison method does tend to say that the profits will be higher for the silver companies that cost less. 

There’s just not a lot of silver exposure here for the price.  But with the high grades, and “gold bonus” the risk is lower, and the profits should be here for those who want more safety in a stock pick.

And they are “rapidly expanding” resources & reserves with round-the-clock drilling of 4 rigs.

MAI.V / MNEAF.OB
http://minandes.com/
ircanada@minandes.com (604) 689-7017
73 mil fully diluted as of Nov. 2003
@ share $.52 CAN x .77 US/Cdn = $.40 US
$29 mil MC
To raise $6.6 mil in recent financing.
owns 49% of the resource: “55 mil silver equiv. oz. resource” back in 2001.  AT 60:1 silver:gold when gold was about $300/oz., about half/half silver and gold.  
Estimated:  27.5 mil oz silver
Estimated:  27.5 mil oz. “silver equiv” of gold.
/ 6 = 4.58 mil oz. silver equiv at 10:1 ratio.
Total: 27.5 + 4.6 = 32 mil oz. silver equiv. (x .49 = 15 mil oz.)
They will be exploring for more.
2.2 km stretch, open another 2.7, plus 3 other vein systems.  significant high grade silver exploration potential.  7000 meters of diamond drilling.  Plus a copper project, billion ton ore deposit.
$29 mil MC / 15 mil = $1.95/oz.
You get “approx” 3 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  About half is gold value, half was silver value at 60:1.  

SIL 
http://www.apexsilver.com/
information@apexsilver.com (303) 839-5060 
36.7 mil shares 
@ $17.85/share
$655 mil MC
cash on hand: $40 million (Nov. 2003)
San Cristobal (Bolivia) (proven & probably reserves) 454 mil silver
(forecast capital costs for construction to total approximately $435 million)
(Produced zero silver in 2002)
7.8 billion pounds of zinc, and 2.9 billion pounds of lead
$655 mil MC / 454 mil oz = $1.44/oz.
You get “approx” 4 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: Apex silver primarily has institutional investors.  

This one has a lot of zinc. That’s an added bonus that is not factored in to my method of valuation. Several writers have been saying zinc prices will be heading up soon, so that’s another bonus. Plenty of zinc is especially good if zinc is moving up in price.  And, they are not mining now, but are waiting for higher silver prices. That’s also a plus. The management also seems to understand that silver will move upwards a lot. Another plus. Finally, George Soros, Billionaire, owns a bit of this one, just under 10% I read recently. That’s a nother plus, in general, for the silver market if Billionaires are paying attention to it.  There are several other zinc / silver plays on this list that investors might also consider: CZN.TO, EXR.V, MMGG.OB (I own all three of these.)

MFN  MFL.TO
http://www.minefinders.com/
Shares Outstanding Fully Diluted 34.1 mil
@ $7.98 
$272 mil MC
Cash on hand, Fully Diluted: C$34 million
“over 3.5 mil ounces of gold resource and 160 mil ounces of silver” –Dec. ’03
silver conversion = 3.5 x 10 = 35 mil + 160 mil oz. silver = 195 mil oz. silver
At 70:1 ratio, 3.5 x 70 = 245 “silver equiv” of gold, and 160 mil of silver = 405.
245/405 = 61% of the mineral value is in the gold, 39% silver.
At 10:1 ratio, 35/195 = 18% of the mineral value is in the gold, 82% silver.
“In addition to the resources already drilled, Minefinders controls a strong portfolio of properties in Nevada, Arizona, and Mexico which have the potential to host new multi-million ounce discoveries over the next few years.”
$272 mil MC / 195 mil oz. = $1.39/oz.
You get “approx” 4.1 ounces in the ground for 1 oz. silver.

Additional Comments:  I dropped MFN from the list on Week #11, when I was purging out “gold companies”.  But MFN had the highest percentage of silver of that deleted group, and so, I added them back to the list.  MFN also now lists their resource figures on the website’s main page.  I’m sure investors appreciate this.  I do.  

* CFTN.PK  (I own shares)
http://www.cliftonmining.com/
clifton@cliftonmining.com 801-756-1414   (303) 642-0659 Ken Friedman
45 mil shares fully diluted  (Oct. 2003)
@ $1.37/share US
$62 mil MC
http://www.cliftonmining.com/wsreview.htm  –source of 100 mil oz. resources est.
http://www.cliftonmining.com/resource.htm
From: http://www.siliconinvestor.com/stocktalk/subject.gsp?subjectid=13531
“A previous geologist has talked about a possible resource of 1 billion oz. of silver, and 5 million oz. of gold.”
100 mil oz. silver
+500,000 oz. gold x 10 = 5 mil oz. silver equiv.
= 105 mil oz. silver.
up to 1000 mil oz. silver “exploration potential”.
Clifton sold up to 50% of the project to Dumont Nickel for $5 million to be paid over time. 
50% x 105 = 52.5 million oz.
50% x 1000 = 500 mil oz. “exploration potential”
$62 mil MC / 52.5 mil oz. = $1.17/oz.
You get “approx” 4.9 ounces in the ground for 1 oz. silver.
Exploration Potential: 46

Additional comments:  Note the “exploration potential”. This is about 10 times cheaper, like 10 cents/oz, or you “might” get 51 oz. in the ground for 1 oz. silver.

For more info on what’s going on with Clifton, see http://www.dumontnickel.com, JV partner.

Clifton has 25% ownership of a biotech firm that makes a colloidal silver.  They recently released a press release that downplayed a letter they received from a person in US Homeland security that “approved” their product.  

Clifton has a patent on a “super” colloidal silver solution made with 10,000 volts that adds oxygen that gives it more powerful antibacterial properties, and is safer since it uses less silver, which would prevent “blue skin” argyria.  Normal colloidal silver that you can make at home with 30 volts works to kill bacteria by disrupting the oxygen metabolism of the cell wall, killing bacteria with oxygen.  The market for safe antibiotics is in the multi Billions of dollars.

I own CFTN.PK.  

* TM.V TUMIF.OB (TUY Frankfurt Exchange)  (I own shares)
http://www.tumiresources.com
nicolaas@attglobal.net Nick Nicolaas IR (604) 657 4058
16.3 fully dilutted shares (Oct. 21, 2003)
+ 7.4 mil shares from Dec. 24th PP
23.7 fully diluted shares (Dec. 2003)
@ share price 1.40 CAN x .77 US/Cdn = $1.07 US
$25.5 mil MC
20 mil oz resource up to 50 million oz. silver potential but needs to be explored and drilled. 
500,000 gold resource x 10 = 5 mil oz. silver equiv. 
Debt free, 2 projects in Mexico.
Raised $2.7 million Nov. 14, 3003
$25.5 mil MC / 25 mil oz. = 1.02  ***I’m using this number***
$25.5 mil MC / 50 mil oz. = .51  (exploration potential)
You get “approx” 5.6 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 11.3 (plus more after bonanza silver discovery late November.)

Additional comments:  Tumi roared up 29% on Nov. 20, followed by a 27% gain on Friday Nov. 21, after the company announced a bonanza grade silver discovery after drilling.  This should significantly increase the numbers for their “exploration potential”, but no word yet on the increase.  It takes time for the geologists to estimate all of that, but investors went crazy over it immediately.  

Tumi is focused on becoming a “premiere junior silver explorer.”  It’s good to see the focus is in the right metal.  Doing active drilling to prove up their projects and increase “resources”.  Nick Nicolaas really understands the silver story, beliving silver has much greater appreciation potential than gold. 

Look at: Tinka TK.V (tumi’s sister company)
A pretty big gold/copper property in Peru (Tumi owns 30% of it)…  
That could mean significantly increased assets for Tumi.

I own shares of TM.V.

KBR.V 
http://www.kimberresources.com
info@kimberresources.com (604) 669-2251
28 mil shares fully diluted
@ share price $1.69 x .77 US/Cdn = US $1.30
$36 mil MC 
from http://www.smartstox.com/reports/kbr.pdf
30 mil oz. silver resources indicated and inferred
540,000 oz. gold x 10 = 5.4 mil “silver equiv.”
$36 mil MC   / 35.4 mil oz. = $1.03/oz.
You get “approx” 5.6 ounces in the ground for 1 oz. silver’s worth of stock.

PAAS
http://panamericansilver.com/
info@panamericansilver.com (604) 684 -1175
(I updated all key PAAS info this week from the company website)
58.2 mil shares fully diluted. (Sept. 2003) 
http://panamericansilver.com/s/CorporateInformation.asp?ReportID=26039
@ $12.99 / share
$756 mil MC
10 silver properties (3 in production)
produced 7 mil oz. silver in 2001:
Reserves & Resources through Dec. 11th, 2003 from
http://panamericansilver.com/s/ReservesAndResources.asp?ReportID=25303
743.2 million total
$756 mil MC / 743.2 mil oz. = $1.01/oz.
You get “approx” 5.66 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments: PAAS is one of the few silver producers on this list. 

PAAS recently went into debt in order to ramp up production. I am strongly biased against debt. But it’s a convertible debenture, so the debt can be converted into stock. They know and believe higher silver prices are coming, which is great, and their strategy is to be in solid production mode when the higher price hits. In the meantime, though, the extra production will delay the inevitable silver boom.

I think it is extremely important to invest in a company that understands the silver story as reported by Ted Butler, David Morgan, and especially me, because I emphasise the potential of monetary demand.  If the company does not understand this, then they are more prone to doing extremely stupid things like perhaps hedging silver at $10/oz. or so, as they will see that as an “unusual spike,” instead of the inevitible stopping point on a major rise.  What if your silver company decides to lock in silver prices at $8, and hedge years of production to “protect the shareholders and provide exposure to the high $8/oz. price,” only to watch silver prices head past $25 and past $50/oz?  Your stock could get wiped out in bankruptcy.  

WARNING: PAAS says at their website that they will hedge silver, in order to finance mine construction. 
http://panamericansilver.com/s/CorporateProfile.asp
“Pan American is loath to give away the upside on any of its silver production, especially at current low metal prices, and will do so only to the minimum extent required as a condition of prudent mine financing.”

On July 30th, 2003, PAAS got $75 million in cash from a debenture deal.
http://tinyurl.com/yrv8
On July 30th, 2003, silver was $5.10/oz.
http://www.kitco.com/charts/historicalsilver.html
$75 million at $5.10/oz. = 14.7 million oz.(silver equiv.)

On December 10th, 2003, silver was $5.68/oz., a 58 cent increase, or an increase of 11.4%
$75 million at $5.68/oz. = 13.2 million oz. (silver equiv.)

That’s a loss of 1.5 million oz. of silver, which, at $5.68, is a loss of $8.52 million dollars, that current PAAS policy cost the shareholders.
Another way to figure it is to take the price difference of silver, ( 11.4%) and multiply by the $75 million, and you get the same $8.5 million dollar loss.

PAAS’s “working capital” (or non-working, depreciating, paper dollars) was $92.8 million on Sept. 30, 2003.  Check the link.
http://www.panamericansilver.com/i/pdf/2003_Q3.pdf
If PAAS averaged holding $92.8 million dollars over the last 4 months and ten days, from July 30th to Dec. 10th, then they lost the equivalent of 11.4% on their “money”, or $10.6 million dollars worth of silver by holding dollars instead of silver bullion during that time period.  Capital spending was only $3.5 million during the third quarter, so they did not need to use the money right away–they should have kept it in the form of silver bullion, obviously.

Given management’s blunder, and refusal to acknowledge the situation, some people will want to sell this stock.  The question people will ask me is, “Sell down to what price?”  I think a fair price for PAAS stock might be about $.40/oz in the ground or so, since you can buy many other companies on this list for less than that.  Given reserves and resources of 743 mil oz., times a “fair value” of $.40/oz., that’s gives a $297 mil Market Cap, divided by the fully diluted 58 mil shares means that PAAS is worth about $5.12/share.

FSR.TO
http://www.firstsilver.com/
info@firstsilver.com (604) 602-9973 or (888) 377-6676
37 mil shares 
@ share price $1.39 Cdn x .77 US/Cdn = $1.07 US
$40 mil MC
From the Company’s main page at their url:
“As at December 31, 2001, First Silver’s mineable reserves were 12 million ounces of silver and inferred resources totaled 30 million ounces of silver. The mine is developing a 1000 plus meter exploration drift to upgrade currently identified inferred resources to mineable ore reserves and to discover new reserves.”
12 + 30 = 42 mil oz.
$40 mil MC / 42 mil oz. = $.94/oz.
You get “approx” 6.1 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: This is a high grade, producing miner.  The high grades are a plus.   They are also actively exploring, another plus. I don’t know what their profits are, if any, nor do I know what the fully diluted share structure is.

* CZN.TO / CZICF.PK –(I own shares)
http://www.canadianzinc.com/
czn@canadianzinc.com 1-866-688-2001
67.3 mil shares fully diluted as of Dec., 2003 (as stated in the proxy, p.8)
9 mil more fully diluted shares proposed by new financing (if approved by shareholders, Dec. 30th)
@ Share Price $1.25 CAN x .77 US/Cdn = $.96 US
$65 mil MC
$71 mil MC –if new financing is approved by shareholders
$7 million cash, CAN, no debt.
not mining ($20 mil needed to finish & start the mine) ($100 mil worth of mining infrastructure in place!)
~70 mil oz. (IN ZONE 3 only!! of 12 zones! This company seems to be greatly under-reporting their silver reserves. Their 18 year mine plan consists of zone 3 only, but there are 12 mineralized zones on the property.)  Really, perhaps well over 100 mil oz. silver.
$65 mil MC / 70 mil oz. = $.92/oz.  
You get “approx” 6.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  CZN likely has much more silver in the ground, and has good profit potential.  I wrote an article on Canadian Zinc on Oct. 23:  Canadian Zinc — Silver Potential  I concluded with a share price target of between US $2.04/share and US $4.42/share.

I wrote another article comparing HL to CZN here: 
Silver Price Expectations of Silver Stock Investors

I would like the company to privide an estimate of the silver on the rest of their properties, but their mine plan consisted only of zone 3 at the moment.  The rest must remain “exploration potential” for now.

To get the mine up and running, they might be able to pay back such debt within 2 years, but I would hope they would avoid debt, and raise the capital as the share price begins to approach US $2/share or more, and do a final public offering between US $2-4/share.

I note several very, very positive things about this company. 

1. This was the mining operation set up by the Hunt brothers, the major silver investors in the silver spike to $50/oz. in 1980 who were destroyed by their own debts and margin calls as a result of the COMEX rule changes and silver short sale manipulation. The Hunts spent $50 million building infrastructure to get the mine running. They were 90% complete when bankruptcy hit. The value of those buildings is now $100 million, and the mine only needs about $20 million (CAN) ($15 mil US) to get the mine up and running. That’s much cheaper than other cost estimates of other operations.
2. The 70 million oz. of silver estimate is for zone 3 only. But there are 12 zones on the property. The zone 3 estimate is for a 10 year mine plan that involves mining zone 3 at current metals prices. The company can mine, at a profit, at current silver and zinc prices.
3. High Grade ores:  
12% zinc/ton; = 240 lbs. zinc/ton x 42 cents/lb. = $101/ton for the zinc.
10.1% lead/ton = 202 lbs. lead/ton x 27 cents/lb. = $55/ton for the lead.
6 oz. silver/ton x $5.11/oz. = $31/ton for the silver.
0.4% copper/ton = 8 lbs. copper/ton x 90 cents/lb. = $7/ton for the copper.
Total: $194/ton.
4.  My method of valuation:  If I counted the zinc as silver, then the price of this company would be something like four times cheaper than it is based on my “valuation method”.  If I counted the lead as silver, then this company would be about 4-5 times cheaper. 
5.  Zinc and base metals prices are moving up strong.  Check http://www.metalprices.com/ for updates.   

CZN announced another private placement of $6 million at $1 per share—but this is not yet a closed deal. See http://biz.yahoo.com/ccn/031205/773610fad1d67c4f91c0845e272ac828_1.html
  
CZN will have to get shareholders to approve this deal in a special meeting on Dec. 30th.  Why? Because the private placement that has already occurred this fall was the maximum allowed by the previous shareholder’s meeting in the summer of ’03.  And by the way, the last financing was a 49% (67.3 – 45.1 =22.2.  22.2 / 45.1 = 49%) share dilution. 

Although the new financing and sale of 9 million shares is a 13.4% dilution of more new shares, it is really a 20% dilution for shareholders who have held and bought since before the last private placement, when there were only 45.1 mil shares, fully diluted.
  
I believe that if shareholders vote NO on this private placement deal, that it will significantly boost the share price, because big money investors (potentially $6 million dollars worth of buying power) who now know about the potential of CZN will then have to buy it on the open market if they want it.

The current situation shows management’s mistake in opening up the previous private placement to the maximum allowable dilution at 50 cents.  They could have sold 1/3 at 50 cents, another 1/3 at $1.00, and the last 1/3 at $1.50, but no, they let it all go, a full 49% dilution, 22.2 million shares (including options) at 50 cents.  Also, the recent price action of the stock, hitting a recent high of $1.73, showed that the previous private placement was too many shares, at too low of a price.

Management should have shown more restraint in issuing shares.  The way to fix that mistake is to take some time, and stop issuing more shares for a while.  Management should wait at least 6 months, and take the time to learn the bullish story for zinc, and learn the bullish story for silver.  I suggest they contact the management of EXR.V and MMGG.OB for their investment packets, which contain good information on zinc.  I suggest they read Ted Butler, David Morgan and Douglas Kanarowski’s 78 Approaching Forces For Higher Silver Prices on silver.  By then, management may understand the full potential of the property they manage, and they will not be so eager to sell it so cheaply.  Also, by that time, the share price should be significantly higher with higher metals prices, and the company and existing shareholders will get more money for their share offerings.

Regarding the policy of raising money, a man once told me, “A mining company should never turn down money.”  That policy may have been good during the 20 year bear market in precious metals, but that won’t work as well in a bull market for precious metals.  The time will come when mining companies will not be raising money, but paying it out handsomly in dividends.

I see this event as not only bullish for CZN, but bullish for all silver stocks in general–because Big money is clearly desperate to own silver stocks at this point, and this desperation will grow as time moves on and the silver price continues to go up.

I own shares of CZN.TO  

WTZ  WTC.TO
http://www.westernsilvercorp.com 
(formerly western copper) –And copper prices are headed up, too, $1.01/lb. now.
info@westernsilvercorp.com Jay Oness Toll Free: 1-888-456-1112
40.1 mil fully diluted (After Dec. 16th 2003 financing)
@ share price $4.94 US
$198 mil MC 
(not actively mining)
$16 million in cash in the till (4 mil + 12 mil financing)
From the “SNC Lavalin Resource Calculation” March, 2003.
Indicated 158.8 mil oz. silver
Inferred   54.6 mil oz. silver
Total 213.4 oz. silver.
Total 1.94 oz. gold x 10 (at 10:1) = 19.4 silver equiv.
Got $3 mil CAN cash, no debt.  
The capital cost to get the mine going is estimated to be US $148 million
Penasquito silver/gold.  213 mil oz silver.  just over 2 mil oz. gold. from Chile/Colrado zone.  
Brechia zone will double the numbers, and infilling inferred to indicated: probably in Jan will have 500 mil oz. silver, 5 mil oz gold.
Exploration potential: 500 mil oz. silver, 5 mil oz. gold, from
http://www.mips1.net/mgn03.nsf/UNID/SBAY-5SUBN6
Two other zones that could each duplicate the success of each of the other two. So up to a Billion… oz. of silver as “exploration potential”!
Feasibility: 2006-7 production timeline.
$198 mil MC   / 233 oz. = $.85/oz.
$198 mil MC   / 1000 oz. = $.198/oz. –exploration potential 
You get “approx” 6.8 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential = 29

Additional comments:  I made yet another Canadian dollar/US dollar conversion error last week.  I said that the price of the financing “was at $5.15, which was 91% of the 52 week high”.  The $5.15 was CANADIAN DOLLARS, not US., and I was looking at the US dollar 52 week high.  The CANADIAN DOLLAR HIGH WAS $7.00.  So, the PP price of  $5.15 was 74% of the 52 week high of $7.00, not 91%.

This is still a better price than Canadian Zinc’s recent PP, which was at $1 Cdn, when the 52 week high was $1.73, making the CZN PP price a mere 58% of the 52 week high.

Note the capital cost to get the mining started: $148 million dollars.   
A friendly email came in and said that WTZ also has the following other metal resources:
3.73 billion pounds of zinc
673 million pounds of copper
1.3 billion pounds of lead

ORM.V (no PK symbol yet?)
http://www.oremex.com/s/Home.asp
info@oremex.com
Fully Diluted:   24,012,928
@ $1.00 x .77 US/Cdn = .77
$18 mil MC
Have $5 million cash in the bank as of Dec. 2003. 
holds the right to acquire a 100% interest in six mineral properties in Mexico.
Oremex will focus on the exploration and development of the Tejamen Silver Property and the San Lucas Silver Property.
They are hoping to explore for up to 100 mil oz. silver by drilling over the next year.
–Experienced team of geologists and managment that have put other properties into production:
Anthony R. Harvey, Chariman, has put 14 properties into production in his 40 year career.
http://www.oremex.com/s/TejamenSilver.asp?ReportID=68653
for an inferred resource of 8.4 million metric tons at a grade of 89 g/t Silver (2.86 opt) and 0.2g/t Gold (0.006 opt).
2.86 x 8.4 = 24 mil oz. silver at Tejamen (one of six properties)
$18 mil MC / 24 mil oz. = $.77/oz.
$18 mil MC / 100 mil oz. = $.18/oz. –exploration potential
You get “approx” 7.5 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 32

SSRI
http://www.silver-standard.com/
paull@silverstandard.com (604) 689-3856 or (888) 338-0046
40 mil shares (Oct. 2003)
@ share price $10.30
$412 mil MC
debt free, cash: $10 mil
not mining or producing
15 silver properties
measured and indicated resources totaling 300.4 million ounces of silver 
plus inferred resources totaling 366 million ounces of silver = 666 mil oz. 
2.2 mil oz. gold. Silver equiv = 22 mil oz. silver. (22+666=688 mil oz.) 
$412 mil MC / 688 mil oz. = $.60/oz.
You get “approx” 9.6 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  SSRI really is the “silver standard”.  SSRI has the largest market cap this far down the list, which makes it a more attractive target for people with larger amounts of money to invest. 

SSRI continues to add to reserves, either through exploring, or through acquisitions.  This company seems to really understand the silver story, and helped to educate me as an investor.  

I attended a two hour presentation after the Gold show in SF in late November.  For the most part, their properties are very well drilled, and they have a fairly solid idea on how much silver oz. in the ground they have.  They started their plan to acquire silver properties and become a “silver company” in about 1993, which explains why they have such a large market cap, and so many good properties with so many ounces of silver.  I encouraged them to acquire silver properties and get ounces in the ground at 10-15 or even 20 cents/oz.  They indicated that they felt this would ‘dilute’ the value of the silver properties they acquired for 5 cents/oz in the ground.    I counted by saying new acquisitions would add value for existing shareholders who hold or acquire the share price at higher prices.  They said they would consider this idea further.  

Some investors like SSRI because of the diversification –SSRI owns many silver properties.  I say you can get a similar kind of diversification by owning stock in many silver companies.

MGR.V / MGRSF.PK    
http://www.mexgold.com/
18.7 mil shares outstanding
@ share price $2.15 CAN x .77 US/Cdn = $1.66 US
$31 mil MC
inferred resource: 45 mil oz. silver + 1 mil oz gold.
1 mil oz. gold = + 10 mil oz. silver equiv
“The estimate does not address significant additional mineralized structures known to be present on the property, or the potential for large strike extensions of known high-grade zones.”
$31 mil MC / 55 mil oz. = $.56/oz.
You get “approx” 10.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Gammon Lake is a large shareholder, 50%.  The quote above comes from Gammon’s website.  http://www.gammonlake.com/corporate_profile.htm  

DNI.V
http://www.dumontnickel.com
info@dumontnickel.com  (416) 595-1195
56.4 mil shares outstanding 
@ share price $.57 share x .77 US/Cdn = $.44
$25 mil MC
*** Dumont still needs to raise and pay several million to clifton for 50% of the project.
$25 mil MC / 52.5 million oz. = $.47/oz.
You get “approx” 12.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Clifton’s JV partner, doing active drilling work right now.  And recent property acquisitions.

ADB.V
http://www.admiralbay.com/
info@admiralbay.com 604 628 5642 — Curt Huber– Business Development  
31.4 mil shares to possibly be fully dilluted.  as of Oct 17, 2003
@ share price $1.30 CAN x .77 US/Cdn = $1.00 US
$31 mil MC
They have $6 million cash.
–owns an option to earn 70% interest in “Miera San Jorge’s Monte del Favor property in Mexico”
“An historical resource estimate based on underground sampling at Monte Del Favor is reported at 17 million tonnes grading 0.85 g/t gold and 224 g/t silver for a contained 123 million ounces of silver and 460,000 ounces of gold.” “While this resource estimate is not fully 43-101 compliant, the Company considers that it provides a conceptual indication of the potential of the property.”
460,000 x 10 = 4.6 mil “silver equiv”.
127.6 mil oz. x 70% interest = 89.3 mil oz.
$31 mil MC /  89.3 mil oz. = $.35/oz.
You get “approx” 16.4 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Prior grades hit 2-5 kilos silver/ ton. (2000-5000g/ton. 70-176 oz. ton)  Very high grades.  The project was never properly drilled with modern methods.

Admiral Bay acquired this option to own a 70% interest in this silver property in June, 2003, and the acquisition did not impact their stock price at that time at all.  Previously, they were a gas company, and they still have this other gas project, which may be more than half the intrinsic value of the company according to Curt Huber, who understands the silver story as expressed by Ted Butler and David Morgan.   

My valuation method, obviously, does not give any value for their gas project, which therefore needs to be factored in as a significant “bonus”.  The company will probably split up the two projects into two companies, so existing shareholders will have shares of each.

They are actively digging, drilling, and releasing results in press releases.

* SRLM.PK (I own shares)
http://www.sterlingmining.com/
RDemotte@aol.com Ray DeMotte 208/676-0599
just under 10 mil shares fully diluted
@ share price $7.25
$72 mil MC
Cash on hand: $1.1 million (an increase, reflecting the increased number of shares from 7 to 9 million) 
~185 mil oz. reserves + resource, Sunshine alone
Quote from: http://www.sterlingmining.com/jun112003.html
“The prior operator last estimated the mine reserves at 26.75 million ounces of silver, 10.36 million pounds of copper and 7.05 million pounds of lead (or approximately 28.85 million ounces of silver-equivalent), as well as an additional resource of 159.66 million ounces of silver. “
~100 mil oz. other properties: the 10 sq. miles around the 1/2 sq mile of the Sunshine (rough guess–needs to be explored)  even though–these extra 100 mil oz. are in the “explorer” category.  They need to be drilled and found, although I’ve heard of estimates as high as 400 mil oz. total for SRLM.PK
$72 mil MC / 185 mil oz. = $.39/oz. 
$72 mil MC / 400 mil oz. = $.16/oz.  (exploration potential)
You get “approx” 14.8 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential is 32. )

Additional comments:  Ray DeMotte really, really understands the silver story, and has been aggressively acquiring silver properties.   Sterling continues to consolidate its land position around the Sunshine mine.  

Sterling Mining acquired the Sunshine mine. Sunshine was one of the big three: Hecla, Couer, & Sunshine. Sunshine went bankrupt. Sterling got the property a few months ago cheap, because they were quick & willing to pay cash. Other buyers wanted to do a full study before making an offer. This company’s share price went ballistic as a result. But the company is still way undervalued. Just do the math, people. I own a substantial share of SRLM.PK There were a few great articles written lately for SRLM. See the company web site, above. The best factors, I feel, are as follows:
1. The Sunshine mine is an existing mine that was mining at a profit. The company went bankrupt, not the mine. So there will be no great capital costs for start up, only minimal costs. 
2. The Sunshine sits on 1/2 sq. mile, and was never fully explored. Sterling Mining owns 10 square miles of property surrounding the Sunshine, right in the heart of silver country, the location of CDE and HL, the other two big companies at the top of this list. 
3. The management of Sunshine understands the silver story. They are on a mission to acquire distressed silver properties at today’s cheap prices. See also: December 14, 2003: “In light of the continued low silver price, Sterling has this year begun holding back into inventory a portion of this year’s silver coins minted.”

I own shares of SRLM.PK

CHD.V CHDSF.PK
http://www.chariotresources.com/
45 mil shares fully diluted October 2003
@ .33 x .77 US/Cdn = .25
$11.4 mil MC
Cello Ccasa (1 project of 4) Resource Estimate – August 2002
31.4 mil oz. silver, 134,000 oz. gold. (x 10 = 1.3) 32.7 mil oz.
(Still much exploration work to do.)
$11.4 mil MC / 32.7 mil oz. = .35/oz.
You get “approx” 16.5 ounces in the ground for 1 oz. silver’s worth of stock.

FAN.TO / FRLLF.PK 
http://www.farallonresources.com/fan/Home.asp
(604) 684-6365  Erick Bertsch 
73.8 mil shares fully diluted as of Oct 31, 2003
@ share price $.63 CAN x .77 US/Cdn = $.485 US
$35.8 mil MC
Exploration and development in Mexico.
See also hdgold.com (Hunter-Dickinson) 
On 4 sulphide deposits out of 16, 29 mil ton grading 89 grams silver/t and 1.57 g gold/t.
Conversion: 89 grams x .0353 oz/gram = 3.14 oz.
RE: those 29 mil tons, they “anticipate increasing resources to 50 mil tonne range…”
3.14 oz. x 29 mil tons = 91 mil oz. silver
1.6 mil oz. gold x 10 = 16 mil oz “silver equiv”.
Total: 107 mil oz. silver equiv. 
(Exploration potential = x 1.7 = 181)
$35.8 mil MC / 107 mil oz. silver equiv.  = $.33/oz.
$35.8 mil MC / 181 mil oz. silver equiv.  = $.19/oz. –exploration potential
You get “approx” 17 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential = 29

Additional comments:  
Private placement news link:
http://biz.yahoo.com/bw/031031/315485_1.html

Nothing done or drilled on the property since 1999.  Why not?  Because of low zinc prices: 46% of the price of the metals was in the zinc before prices crashed…  (This one reminds me of Canadian Zinc.  They think they are a zinc company.)  The largest componant today is gold, which was surprising to Eric, the IR guy I spoke with.  About 1/3 is in silver now.

At today’s low metals prices:  
2% x 2000 lb = 40 lbs zinc x $.42/lb =  $16.8 for the zinc  (.37 to .50 lb zinc.)
3.14 oz. x $5.15 = $16 for the silver.
.055421 oz. x $385/oz. = $21 for the gold
(Assuming 100% metals recovery–which is not likely to be the case.  It may range from 60% to a higher percentage, depending on extraction methods used and the particular mineral targeted, which constantly change with technology advancements, and price changes in the metals.  By the time a mine like this gets running, perhaps in 5 years or so, things may change to allow even greater metal recovery.)

Speaking with FAN.TO guys, they think reserves of ore could be 50 mil tonnes OR MORE, but that they really don’t know, and want to issue conservative estimates.

HDA.V  HULDRA SILVER
no website
Phone: Magnus 1 (604) 261-6040
6.924 million shares out (fully diluted)
@ .51/share x .77 US/Cdn = .39
$2.7 mil MC
no debt
HDA’s proven and probable reserves stand at 161,000 tons of
ore grading an average 25.6 ounces per ton silver, and 10 percent combined
lead/zinc — 4.12 mil oz silver, not including the zinc & lead.
According to Magnus, the indicated and inferred reserves total about 180,000
tons at about the same grading — in other words, a further 4 million ounces of
silver.
~8 mil oz. silver
$2.7 mil MC / 8 mil oz. silver = .34/oz.
You get “approx” 17 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  There is a significant lead/zinc bonus.  “The property could be put into production at a capital cost of CAN $3.5 million — with payback of capital (when equity financed) within two years.” 

* SVL.V / STVZF.PK (I own shares)
http://www.silvercrestmines.com/
info@silvercrestmines.com (604) 691-1730 
24.2 fully diluted Nov. 21, 2003
(pub float: 8.93 mil, the rest is owned by insiders)
@ share price $1.25 CAN x .77 US/Cdn = $.96 US
$23.3 mil MC
Indicated resources of silver 30 mil oz. (SOZ.)
Projects in Honduras.  BUT…
*** discovery adds silver*** (perhaps 40-100 mil oz.) see below
http://biz.yahoo.com/ccn/030902/e028426ecfc575e72750ed7fbd6ab220_1.html
new silver totals are projected to be: 70 – 130 mil oz.
$23.3 mil MC / 70 = $.33/oz.  
$23.3 mil MC / 130 = $.18/oz.  
You get “approx” 17.3 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential = 32 oz.)

Additional comments:  These additional ounces, beyoned the 30 mil oz. are “exploration potential”, and are not 43-101 compliant. 

Plus, their reserves are potentially “open pitable” which reduces costs.  They will be acquiring more silver properties with the money raised in the late November 2003 private placement, which I think is an outstanding way to spend the money.

I own shaers of SVL.V 

* EXR.V / EXPTF.PK (I own shares)
http://www.expatriateresources.com/
info@expatriateresources.com 1-877-682-5474 Dr. Harlan D. Meade, President and CEO
82 mil shares fully dulted. (Dec, 2003)
@ share price .34 CAN x .77 US/Cdn = $.26
$21 mil MC
$1.2 mil CAN capital in the til no debt.
Mostly a base metals company:  Zinc.  Also has some silver & gold.
Total metal content of the six projects with resources… “Using current metal prices, the gross metal value of Expatriate’s interest in the base metals in the properties is approximately US$1.56 billion as compared to US$540 million for its share of the silver and gold.”
Metal:  Expatriate share of the project:
Zinc      2.67 billion lbs.
Copper  385 million lbs.
Lead      202 million lbs.
Silver     63.1 million oz.
Gold       426,700 million oz.
Gold x 10 = 4.3 mil “silver equiv”.
$21 mil MC / 67.4 oz. silver = $.32
You get “approx” 18 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Significant zinc bonus, about 3 times the silver value.  Smelter credits are estimated at about 60% zinc, 25% silver, 10% gold and copper, and the rest, other minerals.  My method of valuation puts a value on the silver only, not the rest, so this is a better value than my number shows.

I own shares of EXR.V.

ASM.V / ASGMF.PK 
http://www.avino.com/
shares@avino.com 604 682-3701 — David Wolfin
10.9 mil shares fully diluted, Nov. 2003 (with the 4 mil new shares from PP)
(proposed PP in late Oct 2 mil units at $1.27 (unit = 1 share + 1 warrant at 1.58)
@ share price $1.80 CAN x .77 US/Cdn = $1.39 US
$15 mil MC
from:    http://www.avino.com/other/goldstock100197.html –in 1997
“How Much Silver Does Avino Have?”
“Operations at Avino’s silver mine in Mexico are both open-pit and underground. I examined the reserves and interpolated the tonnage into silver ounces as follows: 28-million ounces proven; 50-million ounces probable and 27 million ounces possible.” (Not all are 43101 compliant reserves & resources.–that is an old, third party report.)
–focus is on being silver company. A plus.
They actually have over five silver properties/projects.  I’m only have numbers to count for one, the “Avino mine”.  
= 28 + 50 + 27 = 105
Avino owns 49% of that, or 51.5 mil oz.  
-“not considered reserves under the new Canadian National Policy 43-101”
$15 mil MC / 51.5 mil oz. = $.29/oz.
You get “approx” 20 ounces in the ground for 1 oz. silver’s worth of stock.

Additional notes: There are 4 additional silver properties that I don’t have numbers for.  Consider this a “silver bonus”!!!

Mexican mining law once stated that a controlling interest had to be owned by Mexicans, which explains why they only have a 49% interest.  That they don’t have a controlling interest is a minus. This law has changed. The mine was operational until the mine went into temporary closure in November 2001. So there is in place an existing mine, with working infrastructure, which is a bonus.  There is a need for drilling in order to test the potential that was stated in the feasibility study.

* MNMM.OB (I own shares)
http://www.minesmanagement.com/ 
info@minesmanagement.com (509) 838 6050 Doug Dobbs
10.1 mil shares fully diluted as of the Sept. 3 pp that closed.
@ share price $6.29
$64 mil MC 
261 mil oz. silver resources.  Previous drilling spent over $100 million drilling the property.   
$64 mil MC   / 261 mil = $.24/oz.
You get “approx” 24 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: 

Mines Management owned 10% of the rights to their property in Montana. The other 90% owner, Noranda, simply gave up on the property and walked away from their mining claim due to “perpetually” low silver prices and political concerns.   That explains the rocketing share price.  So, the MNMM group got 90% of the rest of the property FOR FREE!–the value of which, and the nature of this transaction has just barely begun to be understood by the market, given the low relative price. 

Their property also has about 60% of the value (at current prices) in copper, 2 Billion pounds of copper, and 261 mil oz. of silver.  Doing the math: 261 mil oz. silver x $5.25/oz. = $1.3 Billion. 2 Billion lbs copper x 1.01/lb. = $2 Billion. Total asset value: $3.3 Billion

Copper continues to move up.  It’s at $1.01/lb. now, and analysts are beginning to recommend copper plays.  MNMM is both copper and silver!  (Also, consider Western Silver formerly Western Copper)  Someday soon, investors are going to rush into copper opportunities, if they are not already.  Mines Management will benefit from this.

They do not have an active working mine–which is a minus.  They will need to raise capital to get a mine going.  Noranda had several estimates for the cost to build a mine and mill, around $250 million.  But it could be less depending on how economic they decide to do things.   They are working on a feasibility study, and avoiding excessive dilution, which is a plus. 

Regarding environmental concerns:  Noranda had a fully approved Environmental Impact Statement (EIS) that led to successful project permitting, so environmental concerns were not a factor in their departure in 2002.

For more on MNMM see
http://www.thebullandbear.com/bb-reporter/bbfr-archive/minesmgmt.html

I own shares of MNMM.OB.  

UNCN.OB
http://www.uncn.net/
Ray Brown, 530-873-4394
70 mil shares
@ $.135 /share
$9.5 mil MC
Three main properties:
Bromide– 372,000 ounces of gold?
Silver Bell–15 mil oz silver?
Deer Trail –287,000 ounces of gold and 27 million ounces of silver… but the lease on the Deer Trail will expire June 1 2004, so they need to raise significant money.
49 mil oz. total.
$9.5 mil MC / 49 mil oz. = .19/oz.
You have an expiring lease on “approx” 30 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  They need $4 million to exercise their option to buy the “Deer Trail” property.   They are considering various options on how to do that.  Ray Brown has been in this business a long time, and is excited that he’s got a bunch of younger guys working on the property now, and he’s encouraged by the upward direction of the price of precious metals.

——————————————————
——————————————————
Explorers:
 
Explorers deserve their own category, since they cannot be valued by my method of looking at reserves and resources of ounces of silver in the ground.  We do not know how many oz. they might have. They are exploring for that. 

This list, although at the bottom, in no way indicates that these companies are more highly valued than companies listed above. It is also difficult to categorize a company as an explorer, since all silver companies always hold more silver properties that need to be explored.  

(The order is by largest market cap first, not by “comparative value”.)

III.TO  IPMLF.PK    
http://www.imperialmetals.com/s/Home.asp
Sabine Goetz, Investor Relations – 604.488.2657 
Fully Diluted     27,735,000 with Nov. 6th 2003 Private Placement
@ share price $6.48 x .77 US/Cdn = $4.99 
$138 mil MC

Additional comments:  III.TO raised $10 million in the Nov. 6th private placement.  

FCO.TO FCACF.PK (I own shares)
http://www.formcap.com/frhome.htm
inform@formcap.com 604-682-6229 
Over 150 mil fully diluted, Dec. 2003
@ .59 x .77 US/Cdn = $.45
$68 mil MC
(Recently completed $10 million financing)
Very large cobolt property: 1-3 million tons of 0.60% cobalt equivalent
2000 lbs/ton x 0.6% = 12 lbs/ton x $17.9/lb. = $214/ton (rich ore)
Cobolt is $17.90/lb. recently, up from $9/lb. (Projected to hit $18-25/lb in 2004)
Formation Capital owns the Sunshine Silver Refinery (near Sterling Mining), worth $50 million.
Break even cost $5-6/lb cobolt.
The Idaho Cobalt Project is projected to produce 1,500 tonnes of cobalt per annum.
= 3,000,000 lbs. production x about $12/lb profit? = about $36 mil profit/year???
FCO.TO also owns a few minor silver projects.
The cobolt project needs more drilling, and with recent financing, things look bright.

(I have been reluctant to add FCO.TO because it is primarily a Cobolt company, not silver, even though I have owned shares of FCO.TO for over a year, but several silver bugs have been bugging me about it, so here it is.)

I own shares of FCO.TO

* CDU.V  CUEAF.PK (I own shares)
http://www.cardero.com/ 
Henk Van Alphen — President (604) 408-7488  
32 million shares fully diluted Dec. 11th , 2003
@ share price $2.72 CAN x .77 US/Cdn = $2.09 US
$67 mil MC
($10 million Cdn cash in the till after $5.9 mil private placement closed on Dec. 11th)
Speculated resources, or “exploration potential”:
Providencia — high grades, could have 100-250 mil oz.
Chingolo — Will finish drilling by secnod week in November — Henk says, “may have 400-600 mil oz. “exploration potential” in 200-300 mil tons of rock.”  They got 30-40 grams (1.23 oz.) on the first drill hole, but hope to find 2-3 ounces silver/ton.  Please note, “exploration potential” is a non quantifiable, non-regulated, unauthorized type of estimate.  It is not 43-101 compliant.  Trading decisions should probably not be made on these kinds of shaky estimates, which may be only hype and hope.  An investor who wants to be protected by US regulations should wait for geologists to pour over the drill results and produce numbers that comply with 43-101 regulations, that may one day appear in a company press release.  (Also, the first time Cardero issued drilling results earlier this year, the stock price was cut almost in half due to lower than expected results.  The stock price has since recovered.)  Nevertheless, here’s how those “exploration potential” numbers work out if you do the math:
$67 mil MC / 500 mil oz exploration potential = $.13/oz.
$67 mil MC / 850 mil oz exploration potential = $.08/oz.
Exploration potential:  you might get about 44 – 72 oz. silver for one oz. silver worth of stock.

Additional comments: *** I wrote an article on Cardero in January, 2003. 
See http://www.gold-eagle.com/editorials_03/hommel020803.html  

Cardero has three properties in Argentina; actively working on two:  Chingolo and Providencia.  Chingolo was just measured as twice as large as previously thought.  They are trying to prove up these properties.   

Providencia also has potentially high grades in several very large conglomerate deposits that can be mined at a profit today.  Their property at Providencia was an active mine, but only a few tons/day.  But they hope to make a large open pit project out of the main deposit, processing perhaps a few thousand tons/day.

High grades are very important in today’s environment, especially if you can buy them cheaply.

They are also acquiring more silver properties, which is another bonus.  This is an aggressive silver company.  More properties help to alleviate the risk of an explorer.

I own shares of CDU.V

* AOT.V ASOLF.PK (I own shares)
http://www.bmts.bc.ca/aot/
1 604 684 8950
39.7 fully diluted. (Nov 2003)
@ $.29/share  x .77 US/Cdn = .223
$8.9 mil MC (US)
—-
Additional comments: They own 5.82 million shares and 388,000 warrants of Cardero at $.35, which have a greater asset value than their market cap. 

5.82 mil shares x $2.72 x .77 US/Cdn = $12.2 mil (US)
$2.72 – .35 = $2.37 x .77 US/Cdn x 388,000 = $708,000 (US)
= $12.7 million (US) worth of Cardero
$12.7 mil MC Cardero / $8.9 mil MC Ascot = 1.42 
(Inverse: Ascot’s share price is 70% of the value of their Cardero Stock)

The value of Cardero Stock, although an asset, it is not like cash, nor silver.  That much stock is far less liquid.  Ascot might have serious trouble selling that much Cardero stock all at once in the current market.  I suppose Ascot is discounted to reflect the reduced liquidity.  This helps to explain why private placements go out at about 80% of the stock price (20% cheaper), due to the lack of liquidity.  

Nevertheless, this looks like a great opportunity for people who cannot afford Private Placements, since the share price is 70% of the value of their holdings of Cardero Stock.  It’s rare when you can buy a company with a market cap of less value than their assets.

(I’m listing this one out of order, not by market cap, and next to Cardero, because of their position in Cardero.)

I own shares of AOT.V

MCAJF.PK 
http://www.macmin.com.au/
376 mil shares
@ share price $ .17 
$64 mil MC
“Total Inferred Resource is 34.5 million ozs silver but the district is unexplored for epithermal silver and exploration to date suggests a district potential of 50 to 100m ozs Ag or perhaps much more.” –“Macmin is a silver focussed company” The Texas Silver Project has in-ground resources of 44.5Moz of silver equivalent
$64 mil MC / 50 mil oz. = $1.27 oz. 
$64 mil MC / 100 mil oz. = $.64oz.  ***using this number*** since we are counting these as explorers in this categorgy.
You might get up to 8.9 oz of silver for one oz silver’s worth of stock

IMR.V  IMXPF.OB
http://www.imaexploration.com
43.4 mil Fully Diluted shares 
@ share price $1.70 CAN x .77 US/Cdn = $1.31  U.S
$57 mil MC

Additional comments:  This explorer has found bonanza high grades in Argentina, which many people consider to be an outstanding benefit, and they are willing to pay much more for such high grades.   Drilling is now underway (Nov. 26th) 

TVI.TO  TVIPF.PK 
http:// www.tvipacific.com
Dianne (IR) Phone: (403) 265-4356
= 344 mil fully diluted  Oct. 7th, 2003
@ share price $.21 CAN x .77 US/Cdn = $.16 US
$56 mil MC
“The company has a policy of not hedging or entering into forward sales contracts.”
Cash flow positive. !!!  –> + 2.5 % royalty on “Rapu Rapu” that should be worth about $1 million per year starting within 9-12 months.  (a cash source for an explorer is a big plus)
14 projects in the Philippines.
Producing a dore bar of 96% silver and 4% gold from Canatuan project with the following:
Total silver = 7.1 mil oz silver
Total gold = 182,000 oz. gold x 10 (@10:1) = 1.8 mil oz silver equiv.
Total silver equiv (Canatuan) = 8.9 mil oz.

+ they own a drilling company with 20 rigs.
+ they have a “foot in the door” in China.
+ many other promising exploration properties in the Asian Pacific.
$56 mil MC

Additional comments:  This company exploded in price this week from 16 cents to 23.5 cents when they announced that they would be mining in China: “TVI Pacific Inc. Receives Landmark Approval for Wholly Foreign-Owned Enterprise (WFOE) Status From Chinese Government”. see http://tinyurl.com/vwbw

They are primarily a silver explorer.  The bonus is they are a producer, and likely are cash flow positive, which are both extremely rare for an explorer.  In fact, the other producers mostly all lose money! 

EZM.V  EZMCF.PK
http://www.eurozinc.com/
Fully Diluted: 224,194,196
@ share price .285 CAN x .77 US/Cdn = $.22
$49 mil MC

Additional comments:  Eurozinc does have significant silver.

CAUCF.PK
http://www.caledonresources.com/
Shares Outstanding – 180,721,142
@ .25 at Yahoo! 
(Mining in China)
$45 mil MC

MAG.V
http://www.magsilver.com
28 mil fully diluted shares (Nov. 19, 2003)
@ share price $2.09 CAN x .77 US/Cdn = $1.61 US
$45 mil MC

–“MAG Silver Corporation enters the silver market as a powerful force. MAG combines a seasoned management team with two drill-ready geological extensions of high-grade world class producing districts. MAG controls 100% of the Juanicipio property adjacent to the Fresnillo District in central Mexico, currently producing over 12% of the world’s silver from high grade underground vein structures.”

The geologist, Peter K.M Megaw, is also working with  EXN.V, another high grade silver project.  Peter’s philosophy was that it makes sense to go after very high grade silver projects that will be profitable regardless of the silver price.  

* NPG.V  NVPGF.PK (I own shares)
http://www.nevadapacificgold.com/
dhottman@nevadapacificgold.com (604) 646-0188 David Hottman
= 43 mil shares fully diluted (Nov 26th, 2003 including recent PP)
@ share price $1.19 CAN x .77 US/Cdn = $.92 US
$39 mil MC
(up to $10 million cash in the til from recent PP)
Amador Canyon Silver Project: 50-250 mil tonnes
silver grades average 4 oz. sil/ ton in the deposit
= 200 to 1000 mil oz. silver????? –very speculative at this point. Drilling needs to be done.
$39 mil MC / 200 mil oz. = $.197/oz.
$39 mil MC / 1000 mil oz. = $.039/oz.
The inverse: you “might” get 29 – 147 ounces in the ground for 1 oz. silver.

Additional comments: NPG.V has 10 gold projects, and one silver-but it may be big.  The Chariman, David Hottman, says that 90% of the value of the company is in gold, NOT silver, and yet, I’m buying this company for the silver value only, and as if the gold componant was worth nothing. (The gold projects are a free bonus, in my book, and help to alleviate the risk of this explorer.)

Explorer in Nevada. They do not really know how much silver they might they have in the Amador Canyon project.  They are doing drilling this fall, 2003, as they just did a $2.5 million private placement, and another $10 million private placement in late November.   On the website, for David Hottman’s bio, it says he was a founding member of Eldorado gold. “During his tenure, Eldorado’s market capitalization grew from Cdn $7 million in 1992 to a peak of Cdn $781 million in 1996.”  Please note, exploration is risky, and costly.   

Now that they are well-capitalized with over $10 million dollars, this company will likely do very well as they drill and prove up the deposits across all their properties.

I own shares of NPG.V  

MMM.TO
http://www.mincomining.com/
investor-info@mincomining.ca 1-888-288-8288
Fully Diluted Issued & Outstanding 23,133,623
@ $1.68 x .77 US/Cdn = $1.29
$29 mil MC
Located in China
2 gold projects and 1 silver  (42% owned).  Explorer
$29 mil MC

* OTMN.PK (I own shares)
http://www.otmining.com/
info@otmining.com Jim Hess Tel: 514-935-2445
8 mil fully diluted.
@ $3.20/share
$25.6 mil MC
Montana
May have over 600 mil oz. exploration potential. (They think their deposit may be bigger than “the richest hill on earth”, which is located near their property.  Visit the url.)  
$25.6 mil MC / 600+ mil oz. = .042/oz.
Exploration potential: you “might” get 135 ounces in the ground for 1 oz. silver.

I own shares of OTMN.PK

* MMGG.OB (I own shares)
http://www.metalin.com/site_map.html
208-665-2002 Merlin Bingham
14 mil shares fully diluted (Oct 23, 2003)
insiders buying on 9-10-2003 at about $1.30/share
insiders buying on 12-01-2003 at $1.66/share
@ share price $1.75 US
$24.5 mil MC

Additional Comments:  Zinc & Silver in Mexico: Sierra Mojada.  Sierra Mojada is a Silver District!
Silver: Historic production was 10 mil tons of high grade ore… historic silver production went right “direct shiped” to the smelter, non-milled.  It contained 500-1000 grams silver/ton, or 17.65 to 35 oz. ton.  This means 170-353 million ounces of historic “high grading,” non-milled, production.
(Who knows how much silver is left?)  That’s the question with an explorer.

Zinc: Very high grades: 11.8% zinc.  Potentially the lowest production cost in the entire zinc industry due to new “oxide deposit” chemical extraction process as revolutionary as “heap leaching”.  Exploring for up to 4 Billion pounds zinc.

Project ownership:  MMGG terminated the buy-in agreement with Penoles, who went into default, so MMGG now owns 100% of the project!  See
http://biz.yahoo.com/bw/031203/35526_1.html

I believe this is very good for MMGG, since the Penoles agreement made it more difficult to quantify the value the company.  Now, it is easier to value the company, and the existing shareholders will own more of the project and profits.  

To compare to other silver/zinc projects:
Apex: $661 mil MC: 7.8 billion pounds of zinc, 454 mil oz silver, low grades.
Canadian Zinc: $78 mil MC: 3 billion pounds of zinc, 70 million ounces of silver.
Metaline: $27.3 mil MC: exploring for perhaps 4 billion pounds of zinc and who knows how much silver. (170-335 mil oz. historic production)

For more, see the research works article here:
http://www.stocksontheweb.com/mmgg.htm

Did you know that some market commentators are more bullish on zinc than on silver?  Although I’m also bullish on zinc for many of the same supply/demand fundamantals as silver, zinc will NEVER have monetary demand, but silver will.  People will never use a pound of zinc (40 cents worth) like they will use a silver dime from 1964 (also worth 40 cents).  Think of that.  Silver is NOT “too bulky” to be used as money.  Zinc is.  And this illustrates the abundantly clear difference between zinc and silver–showing why silver and gold are not “just commodities” but money.

(Merlin of MMGG.OB, and Harlan of EXR.V (friends, actually) both have reports that will educate you on the bullish story for Zinc.)

I own shares of MMGG.OB

IAU.V  ITDXF.PK
http://www.intrepidminerals.com/
scoates@intrepidminerals.com Stephen Coates, Investor Relations (416) 368-4525
41.6 fully diluted w/ Dec. 9 financing?
@ share price $.68 CAN x .77 US/Cdn = .53 US 
$22 mil MC
$3.2 million cash from Dec. 9 financing.
Company’s exposure is about half to gold, half to silver in several projects.
Joint Venture with BHP Billiton focused on “Cannington” style silver deposits using proprietary BHP Billiton data.
(all figures are “exploration potential”)
El Salvador – 38.5 mil oz.
Argentina – 6 mil oz. 
Total: 44 mil oz. silver
Total gold: ~690k oz.  x 10 (10:1 ratio) = ~ 6.9 mil oz. “silver equiv”
Total: 53 mil oz. “silver equiv”. (exploration potential or indicated or inferred, not reserves)
$22 mil MC / 53 mil oz. = $.41/oz.
Hopefully, you get 14 ounces in the ground for 1 oz. silver. 

Additional comments:  This explorer/developer tends to focus on good grade, mineable deposits, and form partnerships with other companies to access great information, and expects to produce silver & gold within 2 years, by 2005.  They also took the time to contact me, after having seen this silver report.  

Since this company is about half gold and half silver, the 10:1 ratio really cuts down the “silver equiv” numbers, so keep in mind the “gold bonus” factor here.  But it’s like that with a lot of the companies on this list, so keep that in mind, and do your own math if you want to use the 70:1 ratio.

SML.V SMLZF.PK
http://www.stealthminerals.com
Email-Bill@McWilliam.com 604-306-0391 Bill McWilliam, Chief Executive Officer
48,197,893  (August 31-02)
@ .52 x .77 US/Cdn = .40
$19 mil MC

EXN.V
http://www.excellonresources.com
114 mil shares fully diluted (Oct 17, 2003 press release)
@ share price $.23 CAN x .77 US/Cdn = $.18 US
$20 mil MC
From http://www.smartstox.com/reports/excellon.html
indicated = 63,400 t x 2738 g/t x .0353oz./g = 6.1 mil oz. silver
inferred = 2100 t x 1,433 g/t x .0353oz./g = .1 mil oz. silver
“gross in-situ value of mineralization is $31.4 million.” 
EXN to own 51% of the project.  Apex is the joint partner. 51% x 6.2 mil oz. = 3.16 mil oz.
(Company expects 114 mil shares fully diluted after takover of Destorbelle, needed to bring project ownership up to 51%)
$20 mil MC 

Additional comments: “Excellon …is exploring and developing”…. “a Bonanza grade Silver deposit in Mexico.”   The geologist, Peter K.M Megaw, is also working with MAG.V  From J. Taylor’s write up on 2002: “After subtracting capital cost of US $1.8 million, custom milling charges and operating costs, management believs this underground development mine can, over the next two years, generate US $15.8 million or nearly $8 million for EXN’s 51% share.” The company plans to use these proceeds to further drill and explore the property.  They believe the property may contain significantly more silver, as if what’s known is only the tail of the tiger; furthermore, they believe they can fund exploration by mining the high-grade silver deposit that has been partly drilled.

NBG.V NBULF.PK   
http://www.newbulletgroup.com/index.htm
50 mil shares fully diluted (including 15 mil new PP)
http://www.newbulletgroup.com/financial.htm
@ .52 x .77 US/Cdn = .40
$20 mil MC
NBG.V has a gold deposit in Brazil that’s bigger than the silver project in Mexico.
http://www.newbulletgroup.com/mexico.htm
” If the deposit extends to considerable depth, as do many of the silver deposits in the region, it is reasonable to assume a deposit of 300 million ounces of silver.” 
Stroud Resources, JV partner, lists the deposit at 150-300 million oz.
http://www.newbulletgroup.com/April1820022.pdf
NBG.V partners with SDR.V
NBG.V to get a 50-70% interest.
$20 mil MC / 50% x  150 mil oz. (75 mil oz.) = .27 oz.
$20 mil MC / 70% x  300 mil oz. (210 mil oz.) = .095 oz.
Exploration potential = 21 – 60 oz. per oz. worth of shares.

SDR.V (There is no PK symbol as yet)
http://www.stroudresourcesltd.com/projects-santo.html
gcoburn@stroudresourcesltd.com Mr. George E. Coburn, President Tel: 416-362-4126
Fully Diluted 69,745,562
@  .14 x .77 US/Cdn = .11
$6.3 mil MC
JV partner with NBG.V on Santo Domingo Silver Project in Mexico.
150 to 300 mil oz.
$7.5 mil MC / 30% 150 mil oz. (45 mil oz.) = .17 oz.
$7.5 mil MC / 50% 300 mil oz. (150 mil oz.) = .05 oz.
Exploration potential = 34 – 115 oz. per oz. worth of shares.

MAN.TO  MMALF.PK
http://www.manhattan-min.com/s/ReservesAndResources.asp
Larry Glazer CEO 1-800-810-7111
63 mil shares fully diluted
@ $.40/share x .77 US/Cdn = $.3 US
$19 mil MC
Location: northern Peru
Do they even own their properties anymore?
Manhattan stock sinks after Peru ends mine deal
http://biz.yahoo.com/rc/031211/minerals_manhattan_stock_1.html
$19 mil MC / ???

Additional comments:  The Peru government revoked the mine concessions.  MAN.TO is consulting their attorneys.  This is a clear example of the RISKS inherant in mining stocks.  

BCM.V  BCEKF.PK
http://www.bearcreekmining.com/s/Home.asp
39,240,457 shares fully diluted
@ $0.54/share x .77 US/Cdn = .42 US
$16 mil MC
–About 6 properties in Peru  (I wonder if Peru presents a significant political risk, given what happened to MAN.TO, or whether that was an isolated case in Peru?  I don’t know either way.)

EPZ.V  ESPZF.PK
http://www.esperanzasilver.com/s/Home.asp
20 million shares fully diluted 
@ share price = $1.00 CAN x .77 US/Cdn = US $.77
$15.4 mil MC 
“Esperanza Silver Corporation is solely dedicated to the identification, acquisition and exploration of new silver projects.”   Looking for high grades.

QTA.V  QURAF.PK
http://www.quaterraresources.com/
Jay Oness Toll Free: 1-888-456-1112
41? mil diluted??? Oct 2003?
three main properties in North America
@ $.45 CAN x .77 US/Cdn = $.35 US
$14 mil MC?

QTA.V is a Sister Company to Western Silver, WTZ above.  

NJMC.OB
http://www.newjerseymining.com/
Fred or Grant Brackebusch minesystems@usamedia.tv
18.7 fully diluted (July 2003)
@ share price $.60 US
$11.2 mil MC 
 New Jersey Mining Company (NJMC) is engaged in exploring for and developing gold, silver and base metal ore reserves in the Coeur d’Alene Mining District of northern Idaho also known as the Silver Valley – one of the world’s richest silver districts.

HGM.V  HOGOF.PK
http://www.holmergold.com/
1-877-859-5200 ask for John Robinson
39.4 mil shares
@ share price $.44 CAN x .77 US/Cdn = $ .34 US
$13.3 mil MC 

Additional comments: silver in cuba. (final feasibility study completed by Rescan-Hatch) gold in Timmins, Ontario.  If there’s a final feasibility study done, it either means they should be close to production, or there should be some good data available on a reserves picture.  But I just don’t have it yet.  Note to self: call these guys!

* GNG.V  GGTHF.PK (I own shares)
http://www.goldengoliath.com/
604-682-2950
32.4 mil shares fully diluted
@ share price $.53 x .77 US/Cdn = $.41
$13.2 mil market cap 

Additional comments:  Silver Explorer in Mexico in the the Sierra Madre mountains: Uruachic.
Doing active drilling on their silver property, Las Bolas, “in a month” (as of Oct. 7th).  They hope to take a collection of old silver mines and make them open pittable.  They have some very high grades from chip samples from the tunnels, ranging from 100g to 500g all the way up to around and over 1000g/ton of silver.

I own shares of GNG.V

CHMN.PK
http://www.chestermining.com/
Bill Hoyt, 785-383-9246
“2.3 million shares outstanding, positive working capital and no debt”
@ $4.25/share
$9.7 mil MC
http://biz.yahoo.com/bw/031121/215141_1.html
Historic estimate: “defined Conjecture mineral reserves of 706,000 tons grading 11.8 ounces per ton (oz/t) silver”
–the Conjecture Mine, with a lease-option agreement signed with Shoshone Silver Mining Company
= 8.3 million ounces of silver (leased out)  Since Chester will be receiving royalties, it makes it harder for me to value this company.
$9.7 mil MC

* KRE.V KREKF.PK (I own shares)
http://www.kenrich-eskay.com/
Toll-free 1-888-805-3940
16 mil shares outstanding   Use “fully diluted” to be safe.
@ $.74 share x .77 US/Cdn = .57
$9 mil MC
Adjacent to Barrick’s silver property, which is “the fifth largest silver producer in the world”.
“The Property was once almost bought for $34.5-35 million in 1996.”

I own shares of KRE.V

MMG.V  MMEEF.PK
http://www.macmillangold.com/
25.6 mil shares outstanding (3q 2003 report June, 2003)
@ share price $.46 CAN x .77 US/Cdn = $.35
$9 mil MC

BGS.V
http:// www.balladnet.com
16.3 mil shares outstanding 
(fully diluted?)
@ shar price $.65 share x .77 US/Cdn = .50 US
$8.2 mil MC
Bonanza grade “grab samples” in southern Argentina near IMA

SPM.V
http://www.scorpiomining.com
7.4 mil shares issued
@ share price $1.30 CAN x .77 US/Cdn = $1.00 US
$7.4 mil MC 

SHSH.PK 
http://www.shoshone-mining.com
Bill Hoyt, 785-383-9246
12 mil shares
@ .55/share 
$6.6 mil MC 
In Cour d’Alene, near CDE, HL, & SRLM.PK

* CEV.V CVEEF.PK (I own shares)
http://www.cabo.ca/ 
jav@cabo.ca (604) 681-8899 John Versfelt, President
57.4 mil fully diluted (as of just issued quarterly report)
@ .125 CAN x .77 US/Cdn = .094
$5.4 mil MC

I own shares of CEV.V

LEG.V
http://www.lateegra.com
Michael Townsend, President
Toll Free: 1-866-669-9377
Richard one of the IR guys.
25-27 mil fully diluted. (Nov-Dec ’03)
@ $ .28/share x .77 US/Cdn = .21
$5.6 mil MC
see also Teuton Resources Corp (TUO.V)
Additional Comments:  –Bonanza grades.  Newmont called them, noticed the property.  Flew out a guy.  El Tigre in Mexico: gold/silver  bonanza style mineralization.  Top grades:  62g/T gold 15,500g/T  silver historic production, from trenching and surface sampling in late 90’s.  Cash on hand: $500,000 CAN

SRY.V
http://www.stingrayresources.com/
info@stingrayresources.com (416) 368 6240
fully diluted 5.9 mil
@ 1.13 x .77 US/Cdn = .87
$5.1 mil MC- Current projects centered in the Sierra Madre Belt of Mexico 

FR.V
http://www.firstmajestic.com/s/Home.asp
info@firstmajestic.com
9.1 mil shares fully diluted (Dec. 2003)
@ $.75 Cdn x .77 US/Cdn = .58
$5.2 mil MC
from http://www.stockjunction.com/modules/emails/featuredprofiles/FR/majestic_sj.html
http://www.jaba.com/2003/info/niko_2003_1.html
First Majestic has just acquired a very promising Silver property in Mexico. They are drilling in November.
They linked an excerpt from my free e-book from silverstockreport.com “8 Reasons why silver is a better investment than gold!” see url here:  http://tinyurl.com/xyyb

BBR.V
http://www.bmts.bc.ca/bbr/
17.2 fully diluted
@ .34/share x .77 US/Cdn = .26
$4.5 mil MC
Silver projects:
Yukon –grab sample of 611 g/t Ag
Argentina –samples from 31 to 5640 g/t Ag

TUO.V TEUTF.PK
http://www.teuton.com/
Dino Cremonese, P.Eng. President (604) 682-3680
20.6 mil fully diluted (July 28,2003)
@ .25 x .77 US/Cdn =.20
$4 mil MC
“Management of Teuton and Lateegra are highly encouraged by the prospective results from the Del Norte exploration to date
located in the Eskay Creek region”

ROK.V
http://www.rocamines.com
14.3 mil fully diluted (July 15, 2003)
@ share price .215 CAN x .77 US/Cdn = .166
$2.4 mil MC 

CBP.V CPBMF.PK
http://www.pacific-bay.com/
Guilford Brett, IR (604) 682-2421
9.2 mil shares outstanding
@ .185 x .77 US/Cdn = .14
$1.3 mil MC


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Final Category: Silver stocks FOR YOU and I TO RESEARCH further:

I strongly recommend you try to “get ahead of me,” and research these stocks to see if I left out any great values.  I probably did.  I simply did not have time, or could not yet find information (without using the telephone) on all the two key figures needed to get the “price per oz.” in the ground.  You need: 1.  The number of shares fully diluted x share price to get the market cap.  Then, 2., you need an estimate of the oz. in the ground.   Usually, I’ve been finding the oz. in the ground resource estimates right off the company webpages, and I get the number of shares by looking for it burried in the financial statements like the quarterlies or annual reports, which are also usually right on the company webpages.    Have fun researching for silver companies, and let me know if you find any good ones, and I’ll add them to this list.

Legend Mining LEG.AX
http://www.legmin.com.au/
specialising in exploration and production of silver.
Silver at the Munni Munni Joint Venture in the West Pilbara region of Western Australia

Malachite Resources NL MAR.AX
http:// www.malachite.com.au/

Mountain Boy Minerals Ltd (MTB.V)
TEL: (250) 636-9283
http://www.stockhouse.ca/news/news.asp?newsid=1933880
high grade samples:  3640 g/T Ag to 45.5 g/T Ag

Mascot Silver Lead Mines MSLM.PK
http://www.mascotsilver.com/
Coeur d’ Alene, Idaho
“Though we have reserves and could conceivably mine them, it frankly makes no sense to do so at current prices. … The end of the silver bear will bring a number of the now-dormant small companies back to life…”

Silver Buckle Mines Inc (SBUM.PK)
Coeur d’ Alene, Idaho

Fischer-Watt Gold Co Inc (FWGO.OB)
Coeur d’ Alene, Idaho
admin@fischer-watt George Beattie, 208-664-6757

Merger Mines Corp (MERG.PK)
Coeur d’ Alene, Idaho

http://www.oxusgold.co.uk/ 216,559,942 Fully Diluted shares
oxus will spin off:  Khandiza is a high-grade zinc, silver, copper and lead deposit located in the Sariasia region of southeast Uzbekistan.

Silver Mountain Lead Mines Inc (SMLM.PK)

Silver Butte Mining SIBM.OB
http://www.umpqua-watersheds.org/local/mine.html
(mine abandoned in 1996, copper/zinc waste water?)

Silver Verde May Mining Co (SIVE.PK)

Metropolitain Mines Ltd (MEMLA.PK)

Silver Surprize Inc (SLSR.PK)

Standard Silver Corp (SDSI.PK)

Horn Silver Mines Co (HRNS.PK)
(801)-281-5656

Golden Phoenix Minerals Inc (GPXM.OB)
“The bars totaled 480.8 ounces and refining returned 228.2 ounces of gold, 243 ounces of silver and 8 ounces of other material. The gold has been sold at about $408 per ounce and the silver has been retained waiting for a higher price.”
–even gold miners are holding back from selling silver!

GoldSpring Inc GSPG.OB

Andean American Mining Corp AAG.V ANMCF.PK

Langis Silver & Cobalt Mining Co Ltd  YLS.V LASCF.PK 
Phone: (416) 628-5936

Ross River Minerals Inc (RRM.V)

La Mancha Resources Inc (LMA.V)
 Phone: 604 990-9599

Silver Bowl –not yet public?
http://www.silver-bowl.com/

SILVER PHOENIX RESOURCES INC. 
Contact: Bill Murray
Tel: 1-250-832-0336
Not yet public, looking for a listed shell on TSX
–The 12th largest undeveloped silver property in BC Canada
10.5 million oz. silver, average grade 24 oz/ton
http://www.minersmanual.com/property_submitals/big_mammoth.html

Bill Murray also has another high grade silver property, no reserves. About 13 ton
was shipped [hand picked] the grades were 51 grams/ton gold and 4456 grams/ton silver
(that’s 4.4 kilos/ton silver!)
 http://www.minersmanual.com/property_submitals/tangier.html

Articles like this one, that present opportunities like these, can tend to move the markets in these stocks. So, be careful when buying. If you place any market orders at the open for any of these small stocks, you might end up buying at prices that are significantly higher than you intended.  Limit orders might be better, but then, you run the risk of your order not being filled if the stock price exceeds your limit.  And bid / ask spreads such as 15% on small cap silver stocks are not unusual.  Markets can especially be moved given the wide readership of the internet. I’ve seen markets moved even by small private newsletters such as lemetropolecafe.com and silver-investor.com (I subscribe to both). Some of these stocks can move up 15%, 30%, 50% or even over 100% in a single day. Thus, valuations can change very, very quickly. So, be careful, and re-check the numbers if the prices move up. Do your own math.

Also note, the majority of these companies have an emphasis on silver.  Most silver is produced as a by product of other mining, like lead or zinc or copper mining.  Those companies that primarily produce other minerals are not featured in this report.  This also helps to explain and prove, that silver is undervalued.  If silver miners cannot mine silver profitably, and this report shows that to be true, then something is wrong with the silver price.  It must go higher.

This report, and my method of valuing silver companies, depends on a much higher price for silver than exists today to be most accurate and most successful.  If silver prices go up significantly, my picks will do well.  If silver prices remain flat, then many of my picks should not do well.  

To learn more about the silver market:
http://www.bibleprophesy.org/SilverStockExtra.html

For information from the SEC on how to protect yourself from a “pump & dump” scam, see 
http://www.bibleprophesy.org/SilverStockExtra.html

Several people have told me that they don’t get information this good even when they sign up for annual newsletter subscriptions from others that cost from  $100 – $300.

You can help to make sure you can keep getting this report for free if you sign up at The Silver Stock Report

Jason Hommel
The Silver Stock Report

Final Disclaimer:  I have not received any compensation from any company for writing up my weekly report on “Silver Stocks–Comparative Valuations”.  I own shares of the following 15 silver stocks: CZN.TO, MNMM.OB, SRLM.PK, CEV.V, CDU.V, NPG.V, CFTN.PK, GNG.V, EXR.V, SVL.V, MMGG.OB, AOT.V, TM.V, OTMN.PK, FCO.TO, KRE.V.  These are required disclaimers by the SEC: whether I’ve been paid, and what I own.  I believe the SEC intended this to be a cautionary note that I own these shares, not as a recommendation or endorsement.  I reserve the right to buy or sell any stock at any time.