Silver Stock Report #17

Silver Stocks–Comparative Valuations  
Weekly Report #17
by Jason Hommel
The Silver Stock Report

Friday, Jan 9, 2004

This week’s report lists about 90 silver stocks.  There are 29 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 about 22 additional “silver” stocks with incomplete information. Company names, 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:  

As much as I would love to tell you exactly which silver stocks to buy, I just can’t give out direct buy/sell advice. There are several reasons.  First, I’m not your broker.  Second, too many people ask.  Third, if I told you what I was buying as I was buying it, you’d buy, and push the price up against me, and it would cost more for me to buy.

The closest thing I can recommend is to tell you a bit more about where I have already put my money, and show you which stocks I own most of.  I offer a monthly “look at my portfolio”.  Try it for a month, and see if it works for you.  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.

Here’s a testimonial: 
Hi from the UK. On 1 Jan paid for 1 month trial, so impressed that I’ve just this minute paid for 1 year subs starting with Jan issue as the trial issue was Dec 2003. I would appreciate confirmation that I’m only going to be charged for I year and not monthly as well.
Keep up the good work, Kind Regards

To read about my religious bias, see my other website, 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 before the end times.  Hint, see Ezekiel 38.

If you want to receive an email notice of when and where this FREE weekly report is published, sign up at  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. is designed to help spread the word. I suggest you email the url to your address book.

Price of silver is $6.46 as of Friday, 2:00 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7863  I will use .79 for ease.  

How to read the following table:
Stock Symbol that works at Yahoo! Finance (Company name) / 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”)   Please note, the price change is the change relative to the silver price.  It does not mean the stock price was up or down in Cdn or US dollars.  This week, since silver moved up 8.5%, 51 cents up from $5.95 to $6.46, silver has likely outperformed some silver stocks that went up by less.  This is a key signal that I have been looking for, that indicates that perhaps now is the time to move the portfolio more heavily towards physical silver bullion.  Has your portfolio outperformed silver this week?  If not, it’s time to re-consider your silver stocks, and or re evaluate how much phyical silver you own.

  1. HL (HECLA MINING CO)                                 .47 even –current producer(gold bonus)
  2. CDE (COEUR D’ALENE)                                 1.1 even –current producer
  3. IPOAF.PK (INDUSTL PENOLES)                    1.5  down –current producer
  4. ECU.V ECUXF.PK (ECU SILVER MINI)            2.2 up –(6.0 EXPT)  –50% gold bonus
  5. GRS GAM.TO (GAMMON LAKE)                    2.5  down –current producer
  6. MAI.V MNEAF.OB (MINERA ANDES)             2.5  up   –exploring for more silver.  (gold bonus)
  7. SIL (APEX SILVER)                                         3.5 even  –large zinc bonus, low grades.
  8. MFN MFL.TO (MINEFINDERS)                       3.8  up
  9. KBR.V KBRRF.PK (KIMBER RSCS)                   4.2 up
  10. * CZN.TO  CZICF.PK (CDN ZINC)                   4.7 up  –large zinc bonus, high grades, low start up costs, great EXPT
  11. * CFTN.PK (CLIFTON MINING)                      5 down — (46 EXPT)
  12. PAAS (PAN AMER SILV)                                  5.1 up  –current producer, in debt.
  13. * TM.V  TUMIF.OB (TUMI RSCS)                    5.9 down — (12 EXPT) recent bonanza grade silver discovery
  14. FSR.TO FSLVF.PK (FIRST SILVER)                 6 up  –current producer
  15. WTZ  WTC.TO (WESTERN SILVER)                6.4  up   — (27 EXPT)
  16. ORM.V (OREMEX RES)                                    7.9 down    (32 EXPT)
  17. SSRI (SILVER STD RSC)                                  8.35 up –multi-property company, understands silver story
  18. * SRLM.PK (STERLING MINING)                    9.2 up –(25 EXPT) acquired the Sunshine in Cour d’Alene
  19. MGR.V  MGRSF.PK (MEXGOLD RSCS)            9.4 down
  20. FAN.TO  FRLLF.PK (FARALLON RSCS)          10.5 up  –(18 EXPT) low grades, silver 1/3; also gold & zinc.
  21. DNI.V DMNKF.PK (DUMONT NICKEL)           11.2 down  –exploring Clifton’s property.
  22. HDA.V (HUSIF?) (HULDRA SILVER)                14.7 even   –very tiny, no debt, zinc bonus, low start up costs.
  23. ADB.V ADBRF.PK (ADMIRAL BAY RSCS)        17 down –actively expanding resources. (Huge gas bonus)
  24. * EXR.V EXPTF.PK (EXPATRIATE RECS)       17 down  –significant zinc bonus 60% zinc, 25% silver
  25. ASM.V ASGMF.PK (AVINO SILV GOLD)         17.6 up –owns 49% of the Avino+ 4 other silver props. (silver bonus)
  26. CHD.V CHDSF.PK (CHARIOT RSCS)               18 down   (explorer, with inferred resources)
  27. * SVL.V STVZF.PK (SILVRCRST MINES)        19 down  –(34 EXPT) –(Silver in Honduras) acquiring silver props.
  28. * MNMM.OB (MINES MGMT)                         23 even  –60% copper bonus (low grades), start up ~ $250 mil
  29. UNCN.OB (UNICO INC)                                  35 down  –lease expiring on largest property in mid 2004.

* = I own shares

Explorers (by market cap):

  2. TVI.TO TVIPF.PK (TVI PACIFIC) –current producer of a dore silver bar 96% silver, 4% gold
  4. FCO.TO FCACF.PK (FORMATION CAPTL)  Cobolt (and Sunshine silver refinery)
  5. * CDU.V  CUEAF.PK (CARDERO RSCS) 45-76 “exploration potential”
  6. * AOT.V ASOLF.PK (ASCOT RSCS) — owns percentage of Cardero, CDU.V
  7. MCAJF.PK (MACMIN LTD) 13 “exploration potential”
  11. * NPG.V NVPGF.PK (NEVADA PAC GOLD) 32-165  “exploration potential”  (owns 1 silver property, 10 gold properties)
  13. * OTMN.PK (O.T. MINING) 138 “exploration potential”
  14. * MMGG.OB (METALLINE MINE) –zinc/silver (historic high grade silver) (low cost revolutionary oxide zinc process)
  15. IAU.V ITDXF.PK (INTREPID MINRLS) 12.8 “exploration potential”
  19. MAN.TO MMALF.PK (MANHATTAN MNRLS) –Protests in Peru, and Peru revoking the property rights, hurt the price.
  21. NBG.V NBULF.PK (NEW BULLET GP)  29 – 81 “exploration potential”
  22. SDR.V (STROUD RSCS) 29 – 95 “exploration potential”
  24. * GNG.V  GGTHF.PK (GOLDEN GOLIATH)  –Historic silver district in Mexico
  36. * CBE.V CBEFF.PK (CABO MINING) –Historic Silver and Cobalt district

* = 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, 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. 

WEEKLY COMMENTARY (All new in this section):

On Friday, Jan 9th, 2pm West Coast, Kudlow and Cramer on CNBC discussed the silver market with PAAS executive Ross Beaty and PAAS board member Bill Fleckstein.  This is the first TV coverage on silver I’ve heard about in years.  

There is an exciting development for me, and for all of you who follow my silver stock report.  My webmasters have completed developing an affiliate program so that other people can advertise my website and earn money by placing links to  If the affiliate program is successful, and I think it will be, it means that this silver stock report will be exposed to a wider audience in the near future.  I also will be re-investing 100% of the money that the website is making (at this early stage) into marketing, and buying traffic at search engines, to increase awareness of the silver market.  I believe that this report is having a positive effect on the silver market, as this report is very educational.  Therefore, I expect more money to be pouring into silver and silver stocks in the coming weeks and months.  This is bullish for all of our silver investments.

Some people may think that the purpose of weekly commentary is so that I can give specific trading advice on whether or not a top might be in, or whether it might be time to jump out of the silver market for the next month or so, if a “correction” is coming.  This is not the purpose of my weekly commentary.  I do not have a short term trading strategy in mind.  I may buy 4-5 silver stocks in a month, and I may raise the money to buy silver stocks by selling other silver stocks, but I’m not getting out of this market anytime in the next 3-10 years, I suppose.  I remain 98-99% invested in silver and silver stocks with the money I have available.  The only cash I have is so that I can put money into private placement opportunities.

I couldn’t get out of the silver stock market quickly even if I wanted to.  I have invested in many private placement opportunities where the hold times vary from 4 months to two years!

I don’t consider or think about short term in/out trading strategies.  I’m a very long term silver bull, based on the fundamentals of the situation.  Short term movements?  I wouldn’t have the foggiest idea how to begin looking for things to affect them or predict them.  Technicals?  Hogwash!  But I believe I know the long term fundamentals of paper money, and silver, and so I have confidently invested based on what I know after having studied the market for several years.  

For example, when I was first buying CZN, it was only me and one other.  When I bought, I caused the stock to move up 15% in one day.  Another day I bought, and it was up 33% in one day, and I was the only buyer!  I posted my buy at the lemetropolecafe board.  How can another human being predict such events as “one man deciding to buy”?  It’s impossible.  On the day I first bought Cabo Mining, I pushed the price up 50%, and then I suppose my buying attracted some volume and other interest, and by the time the day was over, the stock was up 85% for the day!  Another stock, O.T. Mining was up 75% on the Monday after first appearing in this report, even though it was buried way down in the report!  

The silver bullion market is in a similar situation to all of those small market cap stocks.   Any one of about 1000 very wealthy people in the world could decide to buy physical silver bullion in the spot market tomorrow, and that event could move the price of silver up to about $10/oz.  All it takes is one of those very wealthy men to make a buying decision.  Nobody can predict such an event.  But you and I can help to cause such an event by preaching about the merits of silver and silver stock investing, which I am doing, of course.

This also explains why silver stocks are so volatile.  There is no way that anyone who understands the silver story would place extensive sell stops on their silver stocks.  The reason is that we could all wake up tomorrow with the price of silver at $10-15/oz., and the silver shares a hundred percent higher or more.   Therefore, silver investors tend to react to a rise in the price of a silver stock in real time.  And then, sometimes try to sell after someone else is done buying.  This is a very illiquid and thin market.  

Speaking of sudden price movements, there was a sudden rise in silver bullion this Monday.  I have to wonder whether my weekly commentary last weekend may have helped to cause the rise.  I wonder.  What did I write that could have had such an effect?  It could have been any number of things.  1.  The yearly silver stock gains came out for 2003, the gain of 314%.  2.  That there is supposed to be a death penalty for the debasement of the coinage.  3.  That there is multi-generational responsibility for allowing the fraud of the dollar to happen.  4.  That the Churches have been neglectful of their duty to warn the nation of this deception of paper money.  5.  That it is a good and moral decision to stop giving to 501 (c)3 Churches who have the IRS, instead of Jesus Christ, as their head.   I’m not sure if the silver bullion market moved in response to what I wrote, but I did feel it was one of my best commentaries so far to date.

So I think it’s dangerous to try and predict tops (and sell right after a rise) at these relatively low wiggles in prices given the overall move I expect will occur with monetary demand entering the market.  

Here’s something to think about.  Why do people expect me to give short-term in/out trading advice?  Because that’s what most financial advisers do.  And why do most financial advisers do this?  Because they are technical analysts, who don’t care about investing based on the fundamentals, such as how many fraudulent paper dollars exist in the system that could buy real silver.  And that is exactly the reason why the investment opportunity in silver exists.  Because so few investors, and so few investment advisors, buy based on value.

As for the specifics of January and tax strategy… I’ve heard that some people wait to sell until after Jan 1, in order to pay capital gains taxes in the next year, and not in the old year.  This does not affect IRA stock sells, of course.  So, which stocks will people sell to “lock in gains,” is the question?  Why sell silver stocks?  Where else do you go when they are still so cheap?  IE, what do you sell them for, paper dollars?  Ridiculous, and not an option.  Therefore, I see no reason to fear tax related selling.  If anything, it also could help the silver market.  Why?

Because, there have been gains in the other market, the broader stock market, and those people, who may have been eyeing the silver market may have wanted to wait to sell some other stocks that have gained, before casting the money into the silver market.  But that’s weird speculation.  

Also, they say that at year’s end, people sometimes review their portfolio, review their strategies, and make new allocations for the year.  I don’t know of anyone who makes ‘once a year’ investing decisions in January only, but for those people who do, they may decide to chase the momentum of last years gains, which was the silver stock market more than the gold stock market, or perhaps more than any other market sector.

Silver stocks were up 314% for 2003!  Eighty silver stocks on this list are up, on average, 314% for the year, from Jan 1, 2003 to Dec. 31, 2003. 

I feel that if anyone really knows about the silver market, they would do as I did, and jump in with both feet up to their necks without waiting.  Why would anyone wait given the rapid rise we have been seeing?  It would be near to financial suicide.  Each day’s delay would be a significant loss as the silver stocks continue to move up. But of course, it’s a learning curve, and sometimes it takes time to educate and change minds.  

Then again, many people can be educated quite quickly. I’ve never seen a boom in a stock price due to a technical chart reason or prediction.  But I have seen many booms after articles come out on great undervalued stocks that are then followed by a significant price rise.  People do buy when they are educated about great opportunities.

Occasionally, people ask me if I know whether or not a silver stock mutual fund exists, and sometimes people hope I will start one.  

I know that no silver fund exists.  I believe the silver market is still too small, and investor interest still too thin.

You need to be able to pay something like a $100,000 per year salary to such a person who ran a fund.  A fund would need to charge 1% for their fee, or about that.  Therefore, the fund would have to have 100 times the $100,000 in order to just get started.  That’s $10 million, minimum.  That may be too big for the silver market right now, which is only about $7-8 Billion all total.  

For comparison’s sake, the Toqueveille Gold fund was $100 million a few years ago.

As a silver investor myself, if I tried to run something like that, I’d have a huge conflict of interest.   For example, sometimes, if I try to buy a stock on the open market, I’ll move it up 15% or so.  So, if I bought a stock before a fund I ran bought it, it would be a conflict of interest.

Brokers cannot buy stocks ahead of their clients’ orders.  It’s a crime called “front running”.  It’s a crime because your broker is hired by you to be your agent, and he is supposed to represent your interest, and thus, he must keep your buy orders confidential.  I appreciate this, because I may spread out my buys of a silver stock over the course of about a week or even a month.  Knowing my track record, my broker could note that I’m buying a new stock, and then invest his own money right afterwards, and then, I’d have a harder time buying. So I’m glad he keeps it confidential, and that he does not buy stocks I’m buying.  

I’m not a broker, and more importantly, I’m not YOUR broker, so I can buy a stock first, and then tell you about it, and that is not illegal for me to do.  But the SEC is increasingly requiring people to disclose whether they own stock if they are promoting it, and so I’m careful to tell people in my reports which stocks I own.  Sometimes this has been a problem for me, because I’ve moved stock prices up before I felt like I was done buying.  So, there’s no way I could realistically run a fund.  

You would do better to do the research yourself, and pick your own silver stocks anyway.  A silver fund would, by nature, be virtually obligated to own the largest market cap silver stocks, what I consider to be some of the most expensive silver stocks on the list for what you get, like Hecla Mining (HL) and Cour d’Alene, (CDE).

Also, it is possible that the mere existence of my silver stock report makes it less likely that others will be able to start running a silver fund.  For why would you pay others to make the decision on which silver stocks to buy for you (which also would be worse decisions than you could make), when you can do it yourself with my report?

Finally, buying a mutual fund is incompatible with the philosophy behind investing in precious metals.  The reason you buy gold or silver is that precious metal is wealth in the hand, that you own, and you control, and you are responsible for protecting.  It is not a payment, and not a promise.  A mutual fund, by contrast, is like giving up your control of your investments, it is an abdication of responsibility.  Therefore, selling a mutual fund to precious metals investors is a harder sell to begin with.

But there is a Fund manager out there that I know of and respect, and his name is John Embry of Sprott Asset Management.  He is bullish on gold and silver for all of the right reasons, and he understands the monetary fraud of our day, and he is a silver bull.  He’s never contacted me, and I’m not being paid by him to write this.  I’ve heard of him because I’m a subscriber at

I wrote an article on usury this week.  It’s an article I’ve wanted to write for years now.  I’m still proofreading.  One of my advisors said it might upset some people.  I’m pondering some of his comments.  It should come out sometime next week.   I would like to get feedback from my readers on usury this weekend.  I may be able to incorporate some of your thoughts into my piece.

My 2004-2009 price predictions for gold and silver: 
2004: $595/oz. gold,  50:1 ratio = $12/oz. silver

2005: $1011/oz. gold,  30:1 ratio = $34/oz. silver
2006: $1719/oz. gold,   10:1 ratio = $172/oz. silver

2007: $2923/oz. gold,  5:1 ratio = $ 585/oz. silver
2008: $4,969/oz. gold,  1:1 ratio = $4969/oz. silver
2009: $8448/oz. gold, 5:1 ratio = $1698/oz. silver
2010+: infinity dollars/oz. gold, infinity dollars/oz. silver.

I calculate the gold price rise by guessing that by 2009, M3 will have a “gold-value” like it did in 1980, which is to say, M3 was worth 2 Billion oz. of gold or less.  It also assumes M3 will about triple in that time.  These figures are conservative, because I see no reason that M3 should be valued more than the gold the U.S. actually holds, which is a mere 261 million oz., not billion.  Today, the M3 value is $8870 billion / $425/oz. = 19 billion oz. of gold M3 could buy in theory.  The silver:gold ratio is also a very, very vague guess, reflective of monetary demand chasing silver, which is more scarce than gold in above ground, refined form. I have no idea when the ratio of 15:1 will be exceeded, I’m just totally guessing.  I suppose it could happen this year or next month for all I know.  Of course my real price targets are infinity dollars per oz. for both gold and silver when all is said and done, I just don’t know how long that will take, nor what year it will be.  But my point in producing the price predictions is to show my bullishness for silver and gold.

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

Silver stocks were up 314% for 2003!  Eighty silver stocks on my list are up, on average, 314% for the year, from Jan 1, 2003 to Dec. 31, 2003.   I believe that beats any sector, and any mutual fund in the world for 2003.  Anyone know of a better sector or fund?  

Let me say how important it is for silver stock investors to own physical silver.  There is $321 million dollars worth of silver in the registered category available for delivery 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.  

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

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.  

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

Look at the summary of the world silver survey by GFMS Limited on behalf of The Silver Institute:

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.

Sign the silver petition to stop the manipulation at the 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, 32,152 oz. per tonne.)

870 tonnes — the paper position at the COMEX, 280,000 contracts for 100 oz. each.
5,000 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.
2,600 tonnes — annual mine supply
4,000 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 $500/oz. is a massive demand of 18,039 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 are 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:
$20,200,000,000,000: U.S. bond market, yr end, ’02:
$11,700,000,000,000: U.S. stock market, yr end, ’02:
 $11,038,000,000,000: U.S. annual GDP, 3rd q.’03 est.
  $8,879,000,000,000: M3 (money in the banks) Nov. ’03
  $6,939,572,558,142: US debt, 12-4-’03
  $2,212,000,000,000: U.S. annual budget 2003 
  $1,860,000,000,000: World gold, 145,000 T @ $400/oz.
     $554,995,097,146: U.S. budget deficit, ending fiscal year, 09/30/’03
     $274,000,000,000: Market Cap of Microsoft
     $180,000,000,000: debt of Ford Motor Co.
     $104,400,000,000: US gold, 261 mil oz., @ $400/oz.
     $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)
           $329,000,000: 51 mil oz. of registered COMEX silver @ $6.46/oz.

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 $34,000/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 about $111,111/oz. for gold.  At $430/oz, this implies that US bonds and paper currency is 258 times more overvalued than gold.

Gold is overvalued relative to silver, because at current prices, it takes 66 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 66 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, 258 x 66 x 10,  You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 170,000 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 170,000 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. 

“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


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. 
For a list of bullion dealers:
The Silver Stock Report

For a list of Brokers that handle Canadian issues and/or pink sheets:

To track the 130 ticker symbols of the 90 stocks on this list at yahoo:

To learn All about Canadian law, 43-101, about reserves and resources:

A good website that hosts posting boards for many of the smaller canadian stocks is
Click on “Bullboards”.

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 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)
–‘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)
“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 
– 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 (HECLA MINING CO) (208) 769-4100
110 mil shares 
@ $9.06 share 
$1001 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 / $6.46/oz = 19.3 mil “silver equiv” oz.)
19.3 + 53.7 = 73
$1001 mil MC  / 73 mil “oz.” = $13.71/oz.
You get “approx” .47 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: HL has been holding large amounts of cash.  The “silver value” of that cash has been declining rapidly as silver prices move up.  They have lost several million ounces worth of silver by holding dollars, instead of silver. A silver miner has more reason to hold their money in the form of silver than any other corporate entity.  

Yes, it’s easy to be right “in hindsight”.  But I’m not calling this from hindsight.  I had the foresight to call it right, and time has proven me correct.  17 weeks ago, in my very first silver report, I wrote:  

Why hold 113 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, not selling.  They could buy 21 million ounces of silver at $5.25 with that cash.

Today, HL still holds all that 113 million in cash, and even more: they are up to 125 million in cash.  They should have been holding it in the form of silver bullion.  The difference at today’s prices is $6.46 – $5.25 = $1.21.  $1.21/$5.25 = 23%.   17 weeks ago, they could have bought 21.5 million oz. of silver for their $113 million in cash.  Today, they can only buy 17.5 million oz. worth of silver for $113 million.  Therefore, they have LOST 21.5 mil – 17.5 mil = 4 million oz. equivalent worth of silver by holding dollars instead of silver bullion.  At $6.46/oz., that mistake is like a $26 million dollar loss!  

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 19 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.  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 $6.46/oz. is $2.78/oz x 9 mil oz. annual production = $25 million annual profit. That gives a PE of 40. 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.

$1001 mil MC / 180 mil oz. = $5.56/oz. that you’d pay for the silver in the ground whey buying HL.  HL is still expensive, no matter how I run the numbers.  

And in 4 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.

HL was downgraded Jan 6th by CIBC Wrld Mkts from Sector Perform to Sector Underperform

I see multiple reasons why their valuation of HL is right.  HL should underperform the sector.  

CDE (COEUR D’ALENE) (208) 769-8155 or (800) 624-2824
210 mil shares (Issued 32 mil new shares late Oct. 2003)
@ share price $6.37
$1337 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)
$1337 mil MC / 224.7 mil oz = $5.95/oz.
You get “approx” 1.08 ounces in the ground for 1 oz. silver’s worth of stock.

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

This first week of January, CDE announced a deal for $160 million in convertable bonds!  Apparantly, this means they felt they could not sell stock, or they could not find a broker willing to try and sell their stock!   Does this mean their stock is over valued?  I believe it might!  Interestingly, the “sole lead manager” was Deutsche Bank Securities Inc.  This is interesting, because this bank has been continually named by Midas at (of which I am a member) as being involved in short selling the precious metals markets.  As an example, on September 12, Midas wrote, 

September 12 – Gold $375 down $4.30 – Silver $5.18 down 12 centsGoldman Sachs, Morgan Stanley and Deutsche Bank Pound Gold 
After the daily London price bashing, gold took off when the economic news hit the tape and the dollar fell sharply, going $2 higher on the session. That’s when the broken record began playing again. Goldman Sachs and Morgan Stanley crushed gold, taking it down more than $1 on the day. Not so fast! Gold shot back up more than $3. Some seesaw action! This time fellow Gold Cartel member Deutsche Bank showed up, selling hundred lots at a clip. Café sources believe Deutsche Bank sold 3,000 to 4,000 lots in a short period of time. They were joined by the locals. It was as if GS and MS contacted DB and screamed, “we are out of ammo to prevent gold from exploding. HELP!”

The Gold Cartel has used designated hitters like Goldman Sachs, Morgan Stanley and Deutsche Bank to coordinate their gold selling to manipulate the market and keep the price as suppressed as possible.

So, if CDE stock is overvalued, that this debt is “convertable” does not help CDE if the current price is a top for CDE stock.  Instead, this debt could be a stranglehold around their neck.  I am morally opposed to debt for several reasons, most notably, “the borrower is the servant to the lender”.  Deutche Bank is gaining significant control over CDE by this debt issue, and thus, I don’t think this bodes well for the company or shareholders.  In the last year, CDE just barely got itself out of trouble by issuing plenty of shares to pay off debt.  I think they have not yet learned their lesson about how dangerous debt can be.  I think this is a bad development for CDE.  They have just joined ranks with PAAS, the only other company on the list that I know has significant debt.

If I were a central bank, or a bank involved in the manipulation of currencies, what would I do in order to keep the game going as long as possible?  I would loan as much money as I could to as many silver miners as I could in order to boost production of gold and silver.  In fact, I would try to create a bubble of production.  Hey, I’d even mine silver at a loss in order to continue to keep prining money for nothing.  It’s a valuable business to be able to print paper for nothing, and loan it out to whomever is dumb enough to borrow it at interest.  So, I’d loan to silver companies like crazy.  Silver companies beware!  Silver investors beware!

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.

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 recently 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.)

397.5 mil shares outstanding (2002 annual unchanged since 2001)
@ $4.50/share
$1,788 mil MC
419 proven and probable reserves of silver (from 2002 annual report on website)
$1,788 mil MC / 419 oz. silver = $4.27/oz.
You get “approx” 1.51 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.

fully diluted shares = 103.3 million (6 January 2003)
@ Share price .31 CAN x .79 US/Cdn = .24
$25 mil MC
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.
$25 mil MC / 8.5 mil oz. silver equiv. = $2.98/oz.
$25 mil MC / 23.4 mil oz. silver equiv. = $1.07/oz. –exploration potential
You get “approx” 2.2 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential: 6.0

See also regarding ECU’s exploration potential:

Additional comments: ECU recently recovered title to properties that were in dispute.  See:

GRS GAM.TO (GAMMON LAKE) (902) 468-0614
fully diluted 52 mil shares
@ share price $5.05
$263 mil MC
“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.
$263 mil MC / 100 mil oz. = $2.63/oz.
You get “approx” 2.5 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Drill results released:
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 (MINERA ANDES) (604) 689-7017
73 mil fully diluted as of Nov. 2003
@ share $.60 Cdn x .79 US/Cdn = $.54 US
$39 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.
$39 mil MC / 15 mil = $2.63/oz.
You get “approx” 2.46 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 (APEX SILVER) (303) 839-5060 
36.7 mil shares 
@ $22.90/share
$842 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
$842 mil MC / 454 mil oz = $1.85/oz.
You get “approx” 3.5 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, but not SIL.)

Shares Outstanding Fully Diluted 34.1 mil
@ $9.75 
$332 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.”
$332 mil MC / 195 mil oz. = $1.70/oz.
You get “approx” 3.8 ounces in the ground for 1 oz. silver.

Additional Comments:  MFN also now lists their resource figures on their website’s main page.  I’m sure investors appreciate this.  I do.  

KIMBER RSCS) (604) 669-2251
28 mil shares fully diluted
@ share price $2.47 x .79 US/Cdn = US $1.95
$55 mil MC 
30 mil oz. silver resources indicated and inferred
540,000 oz. gold x 10 = 5.4 mil “silver equiv.”
$55 mil MC  / 35.4 mil oz. = $1.54/oz.
You get “approx” 4.2 ounces in the ground for 1 oz. silver’s worth of stock.

* CZN.TO  CZICF.PK (CDN ZINC)  (I own shares) 1-866-688-2001
67.3 mil shares fully diluted as of Dec., 2003 (as stated in the proxy, p.8)
+ 12 mil more fully diluted shares as of Dec. 22 financing.
79.3 fully diluted shares as of Dec. 30th, 2003

@ Share Price $1.53 CAN x .79 US/Cdn = $1.21 US
$96 mil MC 
$13 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.
$96 mil MC  / 70 mil oz. = $1.37/oz.  
You get “approx” 4.72 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  The additional cash means that CZN will now be able to drill and explore more of their property.  Although the company is now more costly to buy, it is far less risky, given that they now have $13 million in cash.

CZN likely has much more silver in the ground, and has good profit potential.  

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. 
3. High Grade ores:  
12% zinc/ton; = 240 lbs. zinc/ton x 46 cents/lb. = $110/ton for the zinc.
10.1% lead/ton = 202 lbs. lead/ton x 34 cents/lb. = $69/ton for the lead.
6 oz. silver/ton x $5.95/oz. = $35/ton for the silver.
0.4% copper/ton = 8 lbs. copper/ton x 1.07 cents/lb. = $8.5/ton for the copper.
Total: $223/ton!  (This price is moving up!)  
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.  46 cents/lb. for zinc!  Check for updates.   

I own shares of CZN.TO  

* CFTN.PK (CLIFTON MINING)  (I own shares) 801-756-1414   (303) 642-0659 Ken Friedman
45 mil shares fully diluted  (Oct. 2003)
@ $1.52/share US
$68 mil MC  –source of 100 mil oz. resources est.
“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”
$68 mil MC / 52.5 mil oz. = $1.30/oz.
You get “approx” 5 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, 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 shares of CFTN.PK.  

PAAS (PAN AMER SILV) (604) 684 -1175
(I updated all key PAAS info this week from the company website)
58.2 mil shares fully diluted. (Sept. 2003)
@ $16.10 / share
$937 mil MC
10 silver properties (3 in production)
produced 7 mil oz. silver in 2001:
Reserves & Resources through Dec. 11th, 2003 from
743.2 million total
$937 mil MC / 743.2 mil oz. = $1.26/oz.
You get “approx” 5.1 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments: I believe PAAS is one of two silver companies on the list today that is significantly in debt (the other is now CDE)!

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. 

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.
“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.”

My opinion is that it is NEVER prudent to go into debt, or lock in silver prices to finance a mine.  If PAAS cannot raise capital on the markets by issuing shares, then they should not be financing new mine construction.  If the market will not support new mine construction, then the market does not need more silver.  PAAS and CDE should learn to trust the free market process, and avoid debt.  

On July 30th, 2003, PAAS got $75 million in cash from a debenture debt financing deal.
On July 30th, 2003, silver was $5.10/oz.

On Jan 9th, silver was $6.46/oz., a $1.36/oz. increase over $5.10, or an increase of 27%

PAAS’s “working capital” (or non-working, depreciating, paper dollars) was $92.8 million on Sept. 30, 2003 or 18.19 mil oz. silver equiv.  Check the link.
If PAAS averaged holding $92.8 million dollars from July to Jan 9th, then they lost the equivalent of 27% on their “money”.  
On Jan 9th, $92.8 million at $6.46 can only buy 14.36 million oz. of silver.  So, PAAS lost (18.19 – 14.36 = 3.83 mil oz.) which, at $6.46/oz., is $24.74 million dollar loss 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.

* TM.V  TUMIF.OB (TUMI RSCS) (TUY Frankfurt Exchange)  (I own shares) Nick Nicolaas IR (604) 657 4058
23.7 fully diluted shares (Dec. 2003)
@ share price 1.46 CAN x .79 US/Cdn = $1.15 US
$27 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, 2003
$27 mil MC / 25 mil oz. = 1.09  ***I’m using this number***
$27 mil MC / 50 mil oz. = .54  (exploration potential)
You get “approx” 5.9 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 12 (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.

FIRST SILVER) (604) 602-9973 or (888) 377-6676
37 mil shares 
@ share price $1.56 Cdn x .79 US/Cdn = $1.23 US
$46 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.
$46 mil MC / 42 mil oz. = $1.09/oz.
You get “approx” 5.95 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.

(formerly western copper) –And copper prices are headed up, too, $1.07/lb. now. Jay Oness Toll Free: 1-888-456-1112
40.1 mil fully diluted (After Dec. 16th 2003 financing)
@ share price $5.90 US
$237 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
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.
$237 mil MC  / 233 oz. = $1.01/oz.
$237 mil MC  / 1000 oz. = $.24/oz. –exploration potential 
You get “approx” 6.4 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential = 27

Additional comments:  Note the capital cost to get the mining started: $148 million dollars.   
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 (OREMEX RES) (no PK symbol yet?)
Fully Diluted:   24,012,928
@ share price $1.05 x .79 US/Cdn = .83
$20 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.
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)
$20 mil MC / 24 mil oz. = $.82/oz.
$20 mil MC / 100 mil oz. = $.20/oz. –exploration potential
You get “approx” 7.9 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 32

SSRI (SILVER STD RSC) (604) 689-3856 or (888) 338-0046
41 mil shares (Oct. 2003)
@ share price $13.02
$532 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.) 
$532 mil MC / 688 mil oz. = $.77/oz.
You get “approx” 8.35 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.

18.7 mil shares outstanding
@ share price $2.55 CAN x .79 US/Cdn = $2.01 US
$38 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.”
$38 mil MC / 55 mil oz. = $.68/oz.
You get “approx” 9.4 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.  

* SRLM.PK (STERLING MINING) (I own shares) Ray DeMotte 208/676-0599
just under 10 mil shares fully diluted
@ share price $13.00
$130 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:
“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
$130 mil MC / 185 mil oz. = $.70/oz. 
$130 mil MC / 500 mil oz. = $.26/oz.  (exploration potential)
You get “approx” 9.2 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential is 25. )

Additional comments:  I wrote an article on SRLM in late Dec. last week.  On Monday and Tuesday after the article came out, the volume and price were really up.  See: Sterling Mining

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

(604) 684-6365  Erick Bertsch 
73.8 mil shares fully diluted as of Oct 31, 2003
@ share price $1.13 CAN x .79 US/Cdn = $.89 US
$66 mil MC
Exploration and development in Mexico.
See also (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)
$66 mil MC / 107 mil oz. silver equiv.  = $.61/oz.
$66 mil MC / 181 mil oz. silver equiv.  = $.36/oz. –exploration potential
You get “approx” 10.5 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential = 18

Additional comments:  

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.

DUMONT NICKEL)  (416) 595-1195
56.4 mil shares outstanding 
@ share price $.68 share x .79 US/Cdn = $.54
$30 mil MC
*** Dumont still needs to raise and pay several million to clifton for 50% of the project.
$30 mil MC / 52.5 million oz. = $.58/oz.
You get “approx” 11.2 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.

HDA.V (HUSIF pink sheets symbol?) (
no website
Phone: Magnus 1 (604) 261-6040
6.924 million shares out (fully diluted)
@ .64/share x .79 US/Cdn = .51
$3.5 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
~8 mil oz. silver
$3.5 mil MC / 8 mil oz. silver = .44/oz.
You get “approx” 14.7 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.” 

ADB.V  ADBRF.PK (ADMIRAL BAY RSCS) 604 628 5642 — Curt Huber– Business Development  
31.4 mil shares to possibly be fully dilluted.  as of Oct 17, 2003
@ share price $1.36 CAN x .79 US/Cdn = $1.07 US
$33.7 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.
$33.7 mil MC /  89.3 mil oz. = $.38/oz.
You get “approx” 17 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.

* EXR.V  EXPTF.PK (EXPATRIATE RECS) (I own shares) 1-877-682-5474 Dr. Harlan D. Meade, President and CEO
82 mil shares fully dulted. (Dec, 2003)
@ share price .39 CAN x .79 US/Cdn = $.31
$215 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”.
$25 mil MC / 67.4 oz. silver = $.37
You get “approx” 17 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 (AVINO SILV GOLD) 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 $2.20 CAN x .79 US/Cdn = $1.74 US
$19 mil MC
from: –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”
$19 mil MC / 51.5 mil oz. = $.37/oz.
You get “approx” 17.6 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.

45 mil shares fully diluted October 2003
@ share price $.33 x .79 US/Cdn = $.26 US
$12 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.)
$12 mil MC / 32.7 mil oz. = .36/oz.
You get “approx” 18 ounces in the ground for 1 oz. silver’s worth of stock.

* SVL.V  STVZF.PK (SILVRCRST MINES) (I own shares) (604) 691-1730 
24.2 fully diluted Nov. 21, 2003
(pub float: 8.93 mil, the rest is owned by insiders)
@ share price $1.35 CAN x .79 US/Cdn = $1.07 US
$25.8 mil MC
Indicated resources of silver 30 mil oz. (SOZ.)
Projects in Honduras.  
Silver totals are projected to be: 75 – 135 mil oz. (not 43-101 compliant)
$25.8 mil MC / 75 = $.344/oz.  
$25.8 mil MC / 135 = $.19/oz.  
You get “approx” 18.8 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential = 34 oz.)

Additional comments:  Silvercrest just acquired two 100% owned silver projects; one in Mexico and one in Guatemala.

I believe this is a great development.  The stock hit a high of $1.81 Cdn a few weeks back even before they acquired these two projects!  

They have been and 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 

* MNMM.OB (MINES MGMT) (I own shares) (509) 838 6050 Doug Dobbs
10.1 mil shares fully diluted as of the Sept. 3 pp that closed.
@ share price $7.15
$72 mil MC 
261 mil oz. silver resources.  Previous drilling spent over $100 million drilling the property.   
$72 mil MC   / 261 mil = $.28/oz.
You get “approx” 23 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 1.07/lb. = $2.14 Billion. Total asset value: $3.4 Billion

Copper continues to move up.  It’s at $1.07/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

I own shares of MNMM.OB.  

Ray Brown, 530-873-4394
70 mil shares
@ $.13 /share
$9 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 mil MC / 49 mil oz. = .18/oz.
You have an expiring lease on “approx” 35 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 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”.)

Sabine Goetz, Investor Relations – 604.488.2657 
Fully Diluted     27,735,000 with Nov. 6th 2003 Private Placement
@ share price $6.76 x .79 US/Cdn = $5.34 
$148 mil MC

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

Dianne (IR) Phone: (403) 265-4356
= 344 mil fully diluted  Oct. 7th, 2003
@ share price $.305 CAN x .79 US/Cdn = $.24 US
$83 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.
$83 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

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! 

43.4 mil Fully Diluted shares 
@ share price $2.31 CAN x .79 US/Cdn = $1.82  U.S
$79 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)   

Drilling results were released Jan 6th.  I have no idea how to interpret the grades, but they didn’t seem like bonanza grades. But maybe plenty is there, to compensate, and the deposit is really big, I don’t know. I believe the stock price moved up significantly in response to the news.

FCO.TO FCACF.PK (FORMATION CAPTL) (I own shares) 604-682-6229 
Over 150 mil fully diluted, Dec. 2003
@ .62 x .79 US/Cdn = $.49
$73 mil MC
(Recently completed $10 million financing)
Very large cobolt property: 1-3 million tons of 0.60% cobalt equivalent
Cobalt prices are racing ahead, up to $29.50/lb.
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 (CARDERO RSCS) (I own shares) 
Henk Van Alphen — President (604) 408-7488  
32 million shares fully diluted Dec. 11th , 2003
@ share price $2.85 CAN x .79 US/Cdn = $2.25 US
$72 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:
$72 mil MC / 500 mil oz exploration potential = $.144/oz.
$72 mil MC / 850 mil oz exploration potential = $.08/oz.
Exploration potential:  you might get about 45 – 76 oz. silver for one oz. silver worth of stock.

Additional comments: *** I wrote an article on Cardero in January, 2003. 

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 (ASCOT RSCS) (I own shares)
1 604 684 8950
39.7 fully diluted. (Nov 2003)
@ $.32/share  x .79 US/Cdn = .273
$10 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 $2.85 x .79 US/Cdn = $13.1 mil (US)
$2.85 – .35 = $2.50 x .79 US/Cdn x 388,000 = $766,000 (US)
= $13.9 million (US) worth of Cardero
$13.9 mil Cardero /  $10 mil MC Ascot = 1.39 
(Inverse: Ascot’s share price is 72% 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 72% 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

376 mil shares
@ share price $ .18 
$68 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
$68 mil MC / 50 mil oz. = $1.35 oz. 
$68 mil MC / 100 mil oz. = $.68 oz.  ***using this number*** since we are counting these as explorers in this categorgy.
You might get up to 9.5 oz of silver for one oz silver’s worth of stock

Fully Diluted: 224,194,196
@ share price .365 Cdn x .79 US/Cdn = $.29
$65 mil MC

Additional comments:  Eurozinc does have significant silver.

28 mil fully diluted shares (Nov. 19, 2003)
@ share price $2.26 CAN x .79 US/Cdn = $2.03 US
$57 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.  

Shares Outstanding – 180,721,142
@ .25 at Yahoo! 
(Mining in China)
$45 mil MC

* NPG.V NVPGF.PK (NEVADA PAC GOLD) (I own shares) (604) 646-0188 David Hottman
= 43 mil shares fully diluted (Nov 26th, 2003 including recent PP)
@ share price $1.17 CAN x .79 US/Cdn = $.92 US
$40 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.
$40 mil MC / 200 mil oz. = $.198/oz.
$40 mil MC / 1000 mil oz. = $.040/oz.
The inverse: you “might” get 32 – 165 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  

Fully Diluted Issued & Outstanding 23,133,623
@ $1.95 x .79 US/Cdn = $1.54
$395 mil MC
Located in China
2 gold projects and 1 silver  (42% owned).  Explorer
$35 mil MC

* OTMN.PK (O.T. MINING) (I own shares) Jim Hess Tel: 514-935-2445
8 mil fully diluted.
@ $3.50/share
$28 mil MC
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.)  
$28 mil MC / 600+ mil oz. = .046/oz.
Exploration potential: you “might” get 138 ounces in the ground for 1 oz. silver.

(I caught myself thinking in terms of dollars while producing this report.  I noted that the stock price of OTMN remained the same from week to week, at $3.50.  While the “oz. in the ground” went up from 127 oz. to 138.  I erroneously thought, “how did that happen?  The price was the same, so how could there be more oz. in the ground?  What was wrong with my math?”  And then, it hit me.  Oh yes, the dollar declined against silver!  It was the dollar drop that I forgot about!  See, you now get more stock for your “one oz. worth of silver” since the silver price went up.  Yes, it was a strange week with silver up so much, and some of the silver mining companies not moving, or even going down in price as measured by silver.  How well do you think in terms of silver?  Are you always aware of the fraud of the dollar?  You should be.)

I own shares of OTMN.PK

* MMGG.OB (METALLINE MINE) (I own shares)
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 $1.77 US
$25 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

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.  

For more, see the research works article here:

(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 (INTREPID MINRLS) Stephen Coates, Investor Relations (416) 368-4525
41.6 fully diluted w/ Dec. 9 financing?
@ share price $.72 CAN x .79 US/Cdn = .57 US 
$24 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)
$24 mil MC / 53 mil oz. = $.44/oz.
Hopefully, you get 14.4 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.  

IAU.V released drill results, Jan 6th.

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 (STEALTH MNRLS) 604-306-0391 Bill McWilliam, Chief Executive Officer
48,197,893  (August 31-02)
@ share price $.63 x .79 US/Cdn = .50
$24 mil MC

Jay Oness Toll Free: 1-888-456-1112
41? mil diluted??? Oct 2003?
three main properties in North America
@ $.73 CAN x .79 US/Cdn = $.58 US
$23.6 mil MC?

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

114 mil shares fully diluted (Oct 17, 2003 press release)
@ share price $.26 Cdn x .79 US/Cdn = $.21 US
$23 mil MC
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%)
$23 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.

Larry Glazer CEO 1-800-810-7111
63 mil shares fully diluted
@ $.385/share x .79 US/Cdn = $.30 US
$19 mil MC
Location: northern Peru
Do they even own their properties anymore?
Manhattan stock sinks after Peru ends mine deal
$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.  

20 million shares fully diluted 
@ share price = $1.13 CAN x .79 US/Cdn = US $.89
$18 mil MC 
“Esperanza Silver Corporation is solely dedicated to the identification, acquisition and exploration of new silver projects.”   Looking for high grades.

50 mil shares fully diluted (including 15 mil new PP)
@ .42 Cdn x .79 US/Cdn = $.33 US
$17 mil MC
NBG.V has a gold deposit in Brazil that’s bigger than the silver project in Mexico.
” 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.
NBG.V partners with SDR.V
NBG.V to get a 50-70% interest. 
50% x  150 mil oz.= 75 mil oz., 70% x  300 mil oz. = 210 mil oz.
$17 mil MC / 75 mil oz. = .22 oz.
$17 mil MC / 210 mil oz. = .079 oz.
Exploration potential = 29 – 81 oz. per oz. worth of shares.

SDR.V (STROUD RSCS) (There is no PK symbol as yet) Mr. George E. Coburn, President Tel: 416-362-4126
Fully Diluted 69,745,562
@  .185 x .79 US/Cdn = .146
$10.17 mil MC
JV partner with NBG.V on Santo Domingo Silver Project in Mexico.
150 to 300 mil oz.
$10.17 mil MC / 30% 150 mil oz. (45 mil oz.) = .23 oz.
$10.17 mil MC / 50% 300 mil oz. (150 mil oz.) = .07 oz.
Exploration potential = 29 – 95 oz. per oz. worth of shares.

39,240,457 shares fully diluted
@ $0.56/share x .79 US/Cdn = .44 US
$17 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.)

32.4 mil shares fully diluted
@ share price $.62 x .79 US/Cdn = $.49
$16 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

1-877-859-5200 ask for John Robinson
39.4 mil shares
@ share price $.46 CAN x .79 US/Cdn = $ .36 US
$14 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!

Bill Hoyt, 785-383-9246
“2.3 million shares outstanding, positive working capital and no debt”
@ $6.00/share
$14 mil MC
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.
$14 mil MC

Fred or Grant Brackebusch
18.7 fully diluted (July 2003)
@ share price $.66 US
$12 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.

25.6 mil shares outstanding (3q 2003 report June, 2003)
@ share price $.60 CAN x .79 US/Cdn = $.47
$12 mil MC

Toll-free 1-888-805-3940
16 mil shares outstanding   Use “fully diluted” to be safe.
@ $.90 share x .79 US/Cdn = .71
$11 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

7.4 mil shares issued
@ share price $1.77 CAN x .79 US/Cdn = $1.39 US
$10 mil MC 

Scopio begins contstruction on new mine.

9.1 mil shares fully diluted (Dec. 2003)
@ $1.30 Cdn x .79 US/Cdn = 1.03
$9.3 mil MC
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 “8 Reasons why silver is a better investment than gold!” see url here:

Michael Townsend, President
Toll Free: 1-866-669-9377
Richard one of the IR guys.
25-27 mil fully diluted. (Nov-Dec ’03)
+ 12.66 fully diluted shares in Jan 7 financing.
= 38.66 fully diluted? (Jan 7, 2004)
@ $ .28/share x .79 US/Cdn = .22
$8.5 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

Bill Hoyt, 785-383-9246
12 mil shares
@ .70/share 
$8.4 mil MC 
In Cour d’Alene, near CDE, HL, & SRLM.PK

16.3 mil shares outstanding 
(fully diluted?)
@ shar price $.60 share x .79 US/Cdn = .47 US
$7.6 mil MC
Bonanza grade “grab samples” in southern Argentina near IMA

SRY.V (STINGRAY RSCS) (416) 368 6240
fully diluted 5.9 mil
@ 1.60 x .79 US/Cdn = 1.26
$7.5 mil MC- Current projects centered in the Sierra Madre Belt of Mexico 

CBE.V CBEFF.PK (CABO MINING)(I own shares) (604) 681-8899 John Versfelt, President
Fully diluted subtotal, including shares needed to acquire two drilling companies, which is contingent upon a financing.
= 18,208,314 as of December 31, 2003 (Post-Consolidated)
Plus a proposed $5 million financing to acquire the two drilling companies.

@ .52 CAN x .79 US/Cdn = .41
$7.46 mil MC
Cabo Mining issued a 4 page press releaseon Jan. 5 detailing their contracts to acquire two drilling companies.  They did a 5-1 share consolidation, or “reverse split”.  It’s like instead of having 5 dimes, you now have a 50 cent piece.  Five shares become one share, and the price per share moved up by five times.  It can help the liquidity of trading and narrow the spread between the bid and ask, since the bid and ask might be 52-54 cents, instead of being from 9-11 cents, which would be like a spread of 45-55 cents.

Regarding the contracts to acquire two drilling companies in Canada:  With all the money raised lately by so many companies to do exploration work now that precious metals prices have increased, I think drilling companies will be very busy making money.  

Cabo Mining is in Cobalt, Ontario, which is a Silver and Cobalt district.  Cobalt prices are racing ahead, more than trippling, up to $29.50/lb up from $9/lb.    To learn more about the mining camp town of Cobalt, there is a fascinating article detailing the history of the camp at

I own shares of CBE.V

17.2 fully diluted
@ .37/share x .79 US/Cdn = .29
$5 mil MC
Silver projects:
Yukon –grab sample of 611 g/t Ag
Argentina –samples from 31 to 5640 g/t Ag

Dino Cremonese, P.Eng. President (604) 682-3680
20.6 mil fully diluted (July 28,2003)
@ .28 x .79 US/Cdn =.22
$4.5 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”

14.3 mil fully diluted (July 15, 2003)
@ share price .22 Cdn x .79 US/Cdn = .17
$2.5 mil MC 

Guilford Brett, IR (604) 682-2421
9.2 mil shares outstanding
@ .17 x .79 US/Cdn = .13
$1.2 mil MC

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
specialising in exploration and production of silver.
Silver at the Munni Munni Joint Venture in the West Pilbara region of Western Australia

Malachite Resources MAR.AX

Mountain Boy Minerals Ltd (MTB.V)
TEL: (250) 636-9283
high grade samples:  3640 g/T Ag to 45.5 g/T Ag

Mascot Silver Lead Mines MSLM.PK
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 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
(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)

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  LSM.V
Phone: (416) 628-5936

Ross River Minerals Inc (RRM.V RRMLF.PK)

Silver Bowl –not yet public?

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

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!)

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 on the internet. I’ve seen markets moved even by small private newsletters such as and (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:

For information from the SEC on how to protect yourself from a “pump & dump” scam, see

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 16 silver stocks: CZN.TO, MNMM.OB, SRLM.PK, CBE.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.