Silver Stock Report #57

Silver Stocks–Comparative Valuations  
Report # 57
by Jason Hommel
silverstockreport.com

Wed, July 15th, 2005 

Table of Contents:
You can click on these links to “jump to” that part of this report.
[Introduction]
[Summary list of Silver Stocks]
[My Methodology] 
[Weekly Commentary] 
[My Conference Schedule] 
[General Commentary on Silver] 
[WHERE and HOW to BUY SILVER BULLION] 
[The money chart] 
[Disclaimers, Warnings, and Advice] 
[Company profiles]
[Company profiles with the most resources, and least cost] 
[Profiles of Explorers]
[Links] 
[Silver Stocks I own]
[Archive of about 40 of my past essays]
[Archive of past Silver Stock Reports]
[Subscribe to the “look at my portfolio”. ($39/mo.)]
[Subscribe to my Private Placement notice list] send a blank email to: pp@silverstockreport.com
[Subscribe to this Weekly Silver Stock Report (FREE)] send a blank email to: subscribe@silverstockreport.com
Contact me: j@silverstockreport.com

Introduction:
Silver at $7/oz. is about 300 times cheaper than historic norms lasting for 1000’s of years.  The amount of silver in a silver dime was historically worth a day’s wage, whether 100 years ago in the U.S. or whether it was a Roman denarius 2000 years ago.   At $7/oz., those same dimes are worth about 50 cents each, and you can buy about 300 silver dimes with a day’s wage of $150.  So, if you invest $5000 to get a bag of silver at $7/oz., and if silver exceeds it’s historic valuation, then a $5000 bag of silver would be worth about $1.5 million in today’s money… that bag of silver would include 10,000 silver dimes–and at a “dime a day”, that’s enough silver dimes for 38 years, working 5 days a week.

The reason that silver is cheap today is that no nation on earth is using silver as money.  The world uses broken paper promises, instead.  Monetary demand for silver started to end in the late 1800’s, and finally ended in the late 1960’s.  Interestingly, starting with the end of World War II, and the beginning of the electronic age, the trend has been to consume, in industry & electronics, nearly all the silver ever mined since the beginning of time; 7/10ths of an ounce of silver per person, per year, in modern industrial nations.  I estimate that modern electronic life has consumed 36 billion out of 40 billion ounces of silver mined since the world began.

Known, above-ground, refined silver may be limited to less than 300 million ounces.  That’s less than 1/20th of an ounce of accessable silver per person on the planet.  Including unknown stockpiles of refined silver (perhaps up to 4 billion ounces such as unknown quantities of silver jewelry in India), there is still probably less than one ounce of silver per person on the planet.

Investors are beginning to become aware of the silver shortage, and thus, in 2002, Hecla mining (silver) was the top performing stock on the NYSE.  In 2003, silver stocks, on average, were up 314%.  Silver prices peaked recently at $8.40/oz. in April 2004…  Silver may reach about $15-25/oz. in the next year.  By the time paper money fails, as it always does, I believe silver prices will exceed historic norms of about an ounce of silver for a day’s wage, due to the shortage that was caused by 60 years of industrial consumption.

This report is the fruit of my work of telling other investors about silver and silver stocks, and the collective wisdom of the feedback I get from my readers…  I don’t always have time to respond to all emails, but you can mail me, Jason Hommel, at j@silverstockreport.com

This report lists the market capitalizations for about 72 silver stocks.  There are about 28 silver stocks that list reserves, resources (and exploration potential) which I calculate by using my “ounce in the ground” formula.  There are about 44 explorers.  There are about 30 additional “silver” stocks with incomplete information.  This report goes out now to over 15,000 investors.  Additions & Changes from last week are in bold.  

Kitco reports silver at $6.94/oz. as of Friday, 1:34 PM West Coast, US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .8189.  I will use .82 for ease.   At today’s prices, it takes 61 oz. of silver to buy 1 oz. of gold.

Summary list of Silver Stocks:
How to read the table below:
It starts on the left with: The Stock Symbol that works at Yahoo! Finance, then, the (Company name) is in parenthesis, then / The number that follows the company name, below, represents the company’s total resources, divided by the market cap as denominated in silver; thus, it is the number of silver ounces “in ground” that you gain title to when you trade away one ounce of silver to buy 1 oz. of silver’s worth of stock.  The number is just one potential valuation method, in this case, a possible expression of leverage that silver stocks can give you, the higher the number, the better. / Next, I list the valuation price change since last report (and stock dilution, and resource changes, if any) as “up” or “down” or “even”.  / Finally, there are additional comments (EXPT is “exploration potential”) Company names in bold have summaries below with updated information since the last report.  Click on the name to see the summary below. This first list contains the companies with information about reserves/resources/exploration potential.  The list is ordered/ranked based on the resource picture.  The most expensive (with the fewest silver resources given their market cap) are listed first.  

1. GRS GAM.TO (GAMMON LAKE)            3.2  –producer, owns 26% of Mexgold
2. FSR.TO FSLVF.PK (FIRST SILVER)        4.3   –producer, (not profitable ’05 1Q.) unhedged, owns bullion
3. PAAS (PAN AMERICAN SILVER)                4.3   –producer, (not profitable ’05 1Q.) large market cap, cash rich
4. SIL (Apex Silver)                                     4.9 –one property explorer in Bolivia, cash rich.
5. CHD.V CHDSF.PK (CHARIOT RSCS)      4.8   –explorer, with inferred resources, massive dilution
6. WTZ WTC.TO (WESTERN SILVER)          5.6   — (16 EXPT) large mine startup cost. copper & zinc bonus
7. * CFTN.PK (CLIFTON MINING)                5.3  — (126 EXPT) (order their colloidal silver now online 10% off)
8. PJO.V (PALMAREJO GOLD CORP)            6.1  NEW –drilling in Mexico, high grade.
9. MFN MFL.TO (MINEFINDERS)                7.6   –significant gold bonus, $35 mil cash on hand.
10. * SVL.V STVZF.PK (SILVERCREST)     7.9    –Silver in Central America, 11.5 oz. of silver/T over 313 feet
11. SVM.V (Silvercorp Metals Inc.)              9.1  NEW Very high Grade Silver, In China.
12. IAU.TO ITDXF.PK (INTREPID MINRLS)    10.1   –exploring in Mexico & Argentina, large EXPT.
13. SSRI SSO.V (SILVER STANDARD)             11.2 –large company, 20+ properties, owns silver bullion
14. FAN.TO FRLLF.PK (FARALLON RSCS)   11.8 –(20 EXPT) low grades, silver 1/3; also gold & zinc bonus.
15. FR.V FMJRF.PK (FIRST MAJESTIC)         16.1  (55 EXPT) –producer in Mexico.
16. * CZN.TO CZICF.PK (CDN ZINC)              18.6 down  –large zinc bonus, low start up costs, great EXPT
17. ORM.V OREXF.PK (OREMEX RES)           18.8  (50 EXPT) –Discovery! 20 oz. silver/T over 292 feet!
18. GGC.V GGCRF.PK (GENCO RECS)              19.1 –producer in Mex.  Plans to expand and acquire
19. * IMR IMR.V (IMA EXPL)                         19.6  –(58 EXPT) in Argentina 83 oz. silver/T over 35 meters!
20. *ABI.V ABMBF.PK  (ABCOURT MINES)     21  –large zinc bonus, + existing infrastructure
21. SHSH.PK (SHOSHONE SILVER)                    21.3   –leased properties; need payments; in Coeur d’Alene
22. YZC.V (Yukon Zinc)                                    23.1  –huge zinc bonus 60% zinc, 25% silver.
23. * MGN (MINES MGMT)                                 27.6  –60% copper bonus (low grades), start up cost ~ $250 mil
24. * SRLM.PK (STERLING MINING)                   29.3  –(69 EXPT) acquired the Sunshine in Coeur d’Alene
25. * CSG.TO CSGLF.PK (CAPSTONE GOLD)    30 down (112 EXPT) (In Mexico, resources are historical)
26. HDA.V HUSIF.PK (HULDRA SILVER)           32.2   –very tiny, zinc bonus, low start up costs.
27. RDV.TO RDFVF.PK (REDCORP VEN)         34.6 –60% gold bonus (May ’05, not feasible.)
28. * ASM.V ASGMF.PK (AVINO SILVER)        39.7 down — to own 100% of the Avino mine 
    

* = I own shares

Next list: Exploration companies or producers with limited information on resources.  This list is in order (roughly) by market cap, the highest market cap companies are listed first.  

1. MGR.V MGRSF.PK (MEXGOLD RSCS)       — bonanza grade discovery on Jan 13th, 2004
   
2. CDY CDU.V (CARDERO RSCS)  –silver, copper, & iron explorer, 19 properties
   
3. AOT.V ASOLF.PK (ASCOT RSCS) — owns percentage of Cardero, CDU.V
4. BCM.V BCEKF.PK (BEAR CRK MINING)   
   
5. * OTMN.PK (O.T. MINING)  very large exploration potential; recently discovered copper porphyry 1200 ft. long.
6. MCAJF.PK (MACMIN LTD) –In Australia
7. MAI.V MNEAF.OB (MINERA ANDES)  (gold bonus)
8. * EDR.V EDRGF.PK (ENDEAVOUR SILVER)  A PRODUCER in Mexico
9. TVI.TO TVIPF.PK (TVI PACIFIC) –A PRODUCER of a dore silver bar 96% silver, 4% gold

This next list has silver exploration companies with market caps under about $30 million 
(Market cap = total number of shares fully diluted, times the share price.  It’s what the company is “worth” in the market place, given the stock price, and is one of the important numbers I calculate each week in these lists.)

1. ECU.V ECUXF.PK (ECU SILVER MINI)  –A PRODUCER 50% gold bonus
2. SPM.V SMNPF.PK (SCORPIO MINING)
3. * MMGG.OB (METALLINE MINE) –zinc/silver (historic high grade silver) (low cost revolutionary oxide zinc process)
4. EXN.V EXLLF.PK (EXCELLON RSCS) –A PRODUCER

This next list has silver exploration companies with market caps under about $20 million

1. MAG.V MSLRF.PK (MAG SILVER)
2. * KRE.V KREKF.PK (KENRICH ESKAY) –Near Eskay Creek  
3. * CBE.V CBEFF.PK (CABO MINING) –Historic Silver and Cobalt district
4. EGD.V EGDMF.PK (ENERGOLD MINING)
5. SDR.V SDURF.PK (STROUD RSCS) (partners with Amerix) –in Mexico
6. APM.V (Amerix Precious Metals Corp) (partners with Stroud) –in Mexico
7. EPZ.V ESPZF.PK (ESPERANZA SILVR)
8. QTA.V QURAF.PK (QUATERRA RES)
9. SML.V SMLZF.PK (STEALTH MNRLS)
10. SRY.V (STINGRAY RSCS)
11. NJMC.OB (NEW JERSEY MIN)

This next list has silver exploration companies with market caps under about $10 million dollars:

1. PXI.V  PNXPF.PK (Planet Exploration Inc.)
2. KG.V KDKGF.PK (KLONDIKE GOLD)
3. MMG.V MMEEF.PK (MCMILLAN GOLD)
4. GPR.V GPRLF.PK (GREAT PANTHER RES)
5. APE.V (Apogee Minerals Ltd.)
6. SSV.V (SOUTHERN SILVER EXPLORATION)
7. * CMA.V CRMXF.OB (Cream Minerals Ltd) –Low grade, large “exploration potential”
8. TM.V TUMIF.OB (TUMI RESOURCES) (TUY Frankfurt Exchange)  –recently acquired rights to buy new projects in Mexico.
9. * PDO.V (PORTAL RESOURCES LTD)  –New Discoveries in Argentina

This next list has silver exploration companies with market caps under about $5 million dollars: (The real “penny stocks” are those with the smallest market caps, not the lowest share price!)

1. IPT.V IMPJF.PK (Impact Minerals)
2. * GRG.V (GOLDEN ARROW RESC)          IMR.V spin-off. 35 properties
3. PCM.V PAOCF.PK (PAC COMOX RES)
4. MTB.V (Mountain Boy Minerals Ltd
5. LSM.V LASCF.PK (Langis Silver & Cobalt Mining Co Ltd)
6. TBLC.PK (TIMBERLINE RES) –in Cour d’Alene
7. * AUN.V AUNFF.PK (AURCANA CORP)
8. LEG.V LEGCF.PK (LATEEGRA RSCS)     –Near Eskay Creek  
   
9. CLZ.V (Canasil Resources Inc)
10. ASLM.PK (AMER SILVER MINI)  — In Cour d’Alene
11. * MVE.V (Minvita Resources)  –Near Eskay Creek  
    

* = I own shares.  
My Methodology:
There are expanded profiles on each company, way below.  But before I get to that, let me discuss my methodology, and the problems with it.

See the number above, listed after each company in the first list?  That number represents the number of silver ounces in the ground that you get when you buy an ounce of silver’s worth of stock.  The number treats all reported ounces in the ground as equal, however, they are NOT EQUAL.  Some ounces in the ground are more certain and others are more speculative.  Some are higher grades, some are lower grades.  Some have been well drilled, others have less drill results.  They range from most certain to least certain such as: “proven & probable reserves,” and then, “measured & indicated resources”, and then, “inferred resources.”   A reserve has a feasibility study produced for it.  A resource, does not.  

According to 43-101 rules, a company CANNOT add together their differently classified resources, nor can they add resources to reserves.  It is to be left up to the investors to decide how to value the different resources of different classifications.  I value them here, as all the same.  You may choose to value things differently.  For example, at goldsheetlinks.com, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources.  I don’t do that.  I count them as all the same.

Here’s the math on how I calculate that one number, used in the summary table above.  First, I get a market cap by multiplying the fully diluted shares (which bullishly assumes all options and warrants will be exercised and converted into outstanding shares) by the share price in U.S. dollars.  Next, I divide that by the silver price, so the market cap is denominated in terms of silver ounces.  Then, I divide the ounces in the ground by the market cap as denominated in silver.  This produces the single number of how many ounces of silver in the ground you are buying when you give up one ounce of silver in your hand, for shares of stock, instead.  This way, you can not only compare silver stocks to each other, you can compare them to silver directly.  This also helps people in other nations, using other currencies, to value these companies.

This valuation does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.  

I believe that the two most important numbers that a silver mining company can report are the resources in the ground, and the number of their fully diluted shares. Of course, there is much more to a mining company than that, but without those numbers, it is extremely difficult to even start an evaluation.  This report highlights those key numbers, where possible.  If you think those numbers are also important, please email the executives of the mining companies you own, and ask them to make sure their numbers are clearly published at their websites.

Problems with my methodology:  My methodology assumes that the more ounces in the ground, is, in theory, best, given that I expect much higher silver prices.  However, unless the price of silver really moves much higher, my methodology may not be the best one.  If silver does really move up very high in value as compared to today, then I expect my methodology to be one of the best predictors of rising stock values, because more ounces in the ground mean more leverage to rising silver prices.  However, the companies with greater leverage to the upside usually also tend to have greater leverage to the downside, and thus, tend to be more volitile.   

WARNING: There are many other factors to consider that may be more important than the single number produced by my methodology:  A resource calculation number does not tell you the entire picture about a company.  The resource calculation number is designed as a starting place for further research.  Other very important considerations are as follows:  How much existing mining infrastructure is in place, and what will it cost to put an exploration project into production?  More infrastructure is better, and higher start up costs are worse and will require further dilution!  How much cash does the comapany have on hand, and how fast are they spending it?  What is the management’s attitude towards money, silver, hedging, debt, and dilution?  And how many ounces of silver are expected to be produced, per year? This is why I list “additional comments” in the company profiles, below.

I don’t consider grade to be too important (although I list it when I can), because I consider the cost to mine to be the more important consideration.  The “cost to mine” is determined in a feasibility study, which is the last thing produced before trying to raise money for final construction of a mine.  And usually, they cannot even count silver as a resource unless it is at least somewhat feasable to mine at today’s prices for silver.  And this is why I count all the ounces as the same.  If a low grade ore can be mined more cheaply, and if a higher grade ore costs more to extract, and if it has to be somewhat economically feasible even at these low silver prices to be counted, it balances out quite nicely. 

My methodology is the natural result of my study of the silver market and my religious views.  To read about my religious views, see my other web site, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again before the end times.  See Ezekiel 38.  Also, see my essay: Biblical Guidelines for Managing your Money

See my June 18, 2004 article: I’m insanely bullish on silver.

To quickly “tab” down to the company you are interested in, note the symbol. Then hit “control-F” to “FIND” the symbol below. 
___________
If I use a word you don’t understand and is not listed in the dictionary at www.m-w.com you can look up the meaning at http://investorwords.com/


WEEKLY COMMENTARY (All new in this section):   

This is the first full silver stock report since February.  
———————

I was interviewed on Al Korelin’s Radio show at the Vancouver show in June, 2005:
http://www.kereport.com/

Segment 18 – Ski-racer-turned-precious-metals-analyst Jason Hommel got our attention late in 2002, when he explained the math behind his contention that gold could rise to $32,567 per ounce. Jason has two websites: silverstockreport.com and bibleprophesy.org. Today, Jason tells us how the Bible supports gold and silver as money, and why the world will ultimately reject all fiat currencies.

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Readers on my email list stand to benefit tremendously from the increase of knowledge of silver stocks that my readers have brought to my attention and are now on this list.  Other leading analysts seem to be in the dark about how many good silver junior exploration stocks exist with substantial, well-defined, silver resources.

Adrain Day wrote, on June 8, 2005:
Silver Attractive, Though Only A Few Good Stocks Benefit
http://www.kitcocasey.com/displayArticle.php?id=147

Like Harry Schultz, Richard Russell, and many others, they seem to think that there are only about 5 silver stocks available.  

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I know of three minerals have run up over 1000% recently: Molybdenum, Selenium, and Indium.

Molybdenum has run up nearly 1000% recently.  See:
The Molybdenum Discussion Board

I have invested in one Moly Stock: 
Idaho General Mines
http://www.idahogeneralmines.com/
27.5 million shares fully diluted (June 2005)
About $30 million market cap.
The reason why I invested was that I was offered shares in a PP at $.40, while the stock was trading at about $.75/share.  Furthermore, Idaho General Mines is further along the process than many others, with a completed feasibility study, showing they can produce moly at about $3.50/lb., whereas prices for moly are up to about $35/lb.

Here is a brief letter I recently received from Idaho General Mines.

Dear Jason,

It was a pleasure speaking with you yesterday.  Idaho General appreciates and values your investment. We welcome the opportunity to further our discussions with you regarding IGM I and our world-class molybdenum project (Mount Hope) that we just completed an extensive feasibility study on and are now beginning with the permitting phase.  Mount Hope is undisputedly the world’s largest undeveloped high grade molybdenum deposit.  Mount Hope is the most economically deserving deposit worthy of being put into production in the United States since the Henderson Mine came on line in 1976.   

Key Investment Highlights:

— Mount Hope is economically robust with exploration upside.
— Project is expected to have low operating costs that can withstand metal price down cycles and generate outstanding margins at mid and peak cycle prices.
— Idaho General expects to generate additional value from other projects including Hall-Tonapah (Cu-Mo); Margaret (Cu, Mo, Au)
— Idaho General has major mining company expertise in a junior company.
— Idaho General is not known to the capital markets, contributing to a substantial discount to net present value.
— Price Per Share: $1.10 (6/22/05)
— 52 Week Range: $0.05 – $1.75
— Shares O/S (basic) 14.5 M; fully diluted 27.5 M
— Cash (5/31/05): $1.5 M 
— Debt (5/31/05): $0.0 M
— Market Capitalization (basic) $15.9 M; fully diluted $30.2 M

Key Mount Hope Metrics from feasibility study includes:

— Life of Mine Total Molybdenum Production: 700 M lbs.
— Molybdenum price assumption: $7.00/lb.
— Life of Mine cash operating cost: $3.40/lb.
— Initial Capex: $406MM
— IRR: very good at $7.00/lb
— Minable Tonnes: 300 M tonnes
— Ore Grade: 0.098% Mo; approx. 2 lbs. Mo/tonnes milled
— Metallurgical Recovery: 91%
— Pit Life: 21 years
— Low Grade Stockpile Adds: 9 years with 134 M tonnes
— Total Processing Life: 30 years
— Throughput Rate: 40,000 tonnes/day
— Technical Grade Molybdenum (TMO) Produced (20 yr average): 28.5 M lbs/yr
— High Quality Deposit with 225,000 ft of drilling in 169 drilled holes
— Open Pit Mine: 2.75 to 1 stripping ratio

As you may know, the spot price for molybdenum has increased a greater percentage than any other metal over these past 24 months climbing from $5.00/lb to $39/lb.  Global demand for molybdenum from China, India, S. Korea, Japan, and the United States is on the rise, and sets a challenge for the global mining community as demand continues to out-strip production.  The increase in demand for molybdenum in the United States and Europe is in-part being driven by the increasing uses and applications of stainless steel, as well as, the development of space-age alloys.  In 2004, world production was estimated at 324 million pounds and world consumption was estimated at 341 million pounds, a deficit of 17 million pounds.   So, if demand continues at the accepted consensus of 6% per annum, then who will fill this supply/demand gap?  We believe Idaho General Mines with our Mount Hope project can help fill this gap.

Once you have had the time to review this brief description of Mount Hope and would like to explore any thoughts and ideas that might be mutually beneficial regarding this investment opportunity please give me a call.

Sincerely,

Robert L. Dumont
VP Business Strategies & Development 
(509) 838-1213
rldumont@idahogeneralmines.com

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RETRACTION!
A few months ago, in the article on Silver & IMA Exploration, the article I co-authored stated:

“The CEO of Aquiline, also a principal in other mining ventures, has earned a reputation as something of a serial litigant, and is currently involved in a separate mining lawsuit in Australia.”

However, the CEO of Aquiline, Mark Henderson, emailed me, and I spoke with him on the phone, and in fact, he is NOT involved in a separate mining lawsuit in Australia.  

———————

Here’s a tip.  Call the smallest companies directly.  If you can put $20,000 to $100,000 into a single stock, and not let that be more than 10% of your portfolio, you generally don’t need to wait for the company to “offer” a private placement deal.  You can sometimes get them to create a PP deal for you, personally.  Just call them up, find out as much as you can about the company’s plans, and if you like the deal, then tell them you want to buy $100,000 worth of stock in a private placement.


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It has really been bothering me that I use Federal Reserve notes.  I’ve been thinking of them as “unjust weights and measures.”  And what bothers me most is that the Bible says that we ought not to have an unjust weight and measure in our house or purse!  

But perhaps “unjust weight and measure” is an inaccurate description of paper dollars?  I suppose the word “dollar” was originally defined as a measure and weight of gold or silver, as based on the definition of the word “dollar”.  But a paper dollar is not, and never was, a weight and meausure of gold or silver!  A paper dollar was a promise to deliver an amount of gold or silver, on demand.  Thus, a paper dollar is a promise of a measure, not the measure itself.  Further, the dollar today is also not a weight nor measure, it is a promise, and specifically a broken promise. 

Many people have said that they do not understand what I mean when I say the dollar is an unjust weight and measure.  Perhaps that’s my fault, because a more accurate description of dollars is simply: “broken promises”.

————–

How our monetary system, and the overvalued dollar, helps and hurts the average guy…

How it helps:  
1.  Imports are cheaper, cheap things from Wal-Mart.
2.  Extra paper money creates a “boom” of extra economic activity; higher housing prices create a housing boom & more contruction jobs.  More investment dollars can create a “tech boom” as we saw with internet stocks.
3.  Government spending creates a “source” of new money into the economy, and thus, jobs.
4.  Booming housing prices allow people to refinance, at lower rates.
5.  Creates the opportunity to buy gold and silver very cheaply.


How it hurts:
1.  Exports are relatively expensive, so we can’t compete with overseas, & we lose jobs.
2.  All dollars are now vulnerable to losing 95% of value, overnight.
3.  The U.S. dollar is vulnerable to other nations selling dollars for gold (China, or Japan).
4.  Bankrupt companies who borrow money to stay alive make it hard to compete. (GM & Ford)
5.  Easy money leads to making bad investments; houses, stocks, and bonds are all overvalued.
6.  “Capital gains” on housing, stocks, bonds, are really no gain at all, but a symptom of the inflation and devaluation of the dollar.
7.  Those who have invested in gold and silver have lost much since the peak in 1980.

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While in Vancouver in June, I was interviewed by Nick Nickolas of mininginteractive.com  You can watch the 10 minute clip here:  
http://www.mininginteractive.com/media/jason-h/jason-h.htm

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Questions to think about:

What does it mean that there are position limits on longs in the silver market?

Are limits evidence of shortages?

What causes shortages?

Does price fixing cause shortages?

Does a price that is too low cause shortages?

Does a free market price cause shortages, or plenty?

What are the position limits on longs, in silver, for one month? (1500 contracts for 5000 oz. each, or 7.5 million oz.)
What is a possible delivery limit on longs, in silver, for one month? (1.5 million oz.)
What are the implications of those limits?

What is the average open interest in the COMEX paper silver market? (100,000 contracts?)

How much larger is the open interest, in silver than the position limits? (66 times!)

How many times larger is the open interest, in silver, than a possible delivery limit?  (333 times!)

How many times larger is the open interest, in silver, than what is registered for delivery at the Comex?  500 mill oz. / 40 mil oz. = 12.5 times.

What would be the effect of unlimited and unrestricted naked short selling in any futures market?

What would be required for a manipulation on the short side to succeed?  

Wouldn’t position limits and delivery limits on the longs be required?

Would a price cap on gold and silver help to increase the value of the U.S. dollar, and all paper currencies?

How much larger is the non-transparent “over the counter” market in silver than COMEX silver?

What is the chance of default in silver in the paper futures markets on COMEX?

What is required for a default of delivery of silver to occur?  

Is a high price for silver a necessary precondition for default, or is a lack of silver the cause of a default?

Why did a palladium default occur on the TOCOM in 2000?

What would happen after a delivery default in silver?

Would the end of redeemability of paper money for silver, such as happened in the 1960’s be like such a default?

What happened to the price of gold and silver after 1971, after the default on redeemine U.S. dollars for gold at $35/oz.?

Which generally comes first, a major price rise, or a delivery default?

Is it harder to get delivery before or after a major delivery default?

If the futures markets have been used since 1980 to contain the price of silver and gold, what will happen to the prices of gold and silver if the futures markets blow up?

What would happen if 1% of the value of M3 were to buy gold and silver within one year?

What would happen if 1% of the value of the bond market were to buy gold and silver within one year?

What would happen if 1% of CalPERS (The California Public Employees’ Retirement System) (Calpers has $190 billion as of July, 2005) were to buy gold and silver within one year?

What would the price of silver soar to, if California started to issue silver coins as payment to California State employees?

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If you want to know where my money is, what stocks I own, and in what proportion, please sign up at silverstockreport.com to the “look at my portfolio”.

For all goldismoney.com subscribers, please send a copy of your receipt (or a past copy of the “look at my portfolio”) to support@silverstockreport.com Only support@silverstockreport.com can issue you passwords.  I cannot.   Prior customers can also get a quick copy of the latest report if you email your receipt, (or a past copy of the “look at my portfolio”) to me here: j@silverstockreport.com (Neither I, nor my new support staff, has access to the prior goldismoney customer database, so please send your prior email recepts, or a past issue.) 


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My Conference Schedule:

I will be attending:

1.  August 8-9 Yukon, Canada. GATA’s “Gold Rush 21”  http://www.goldrush21.com/
2.  Sept, 22-24, Idaho, USA the 3rd Silver Summit. , –I’ll be speaking.  http://silverminers.org/
http://www.thesilversummit.com/
3.  Oct. 2-3, Toronto, Canada: There are 4 annual Cambridge House shows (I usually speak on silver for a 1/2 hour, and maybe a panel)… see http://www.goldshow.ca/
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To read about my religious views, see my other web site, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again before the end times.  See Ezekiel 38.  Also, see my essay: Biblical Guidelines for Managing your Money
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Because I have a market reach, I also receive a lot of tips about silver stocks.  And thus, I believe I may have invested in some of the best ones that came my way.  If you believe I may have an edge based on my work and unique position… then the best way for me to share this with you is to is tell you more precisely where I put my money.  It’s not investment advice.  I offer a monthly “look at my portfolio”.   I do not issue recommendations, and I don’t list number of shares or the size of my portfolio, but I will show the top investments in my portfolio, by rank, updated monthly.  It includes which stocks are 9% and more of my portfolio, those between 9% and 6%, under 6%, under 3%, and under 1%.

To order, visit: silverstockreport.com
Price:  Monthly rebilling at $39.95. –most convenient, best customer service
Customer Service:  http://www.silverstockreport.com/customerservice.htm
Toll Free Customer Service Hotline: 800-370-4154

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2 Silver Stock Funds

1.  Richard Greene, thundercapital.com $100,000 minimum, 2 year hold, sophisticated/accredited investors only.  Will use margin, and/or short sell.

2.  Philip Judge or Simon Heapes, anglofareast.com  Less than $5000 minimum?  No margin or shortselling.

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

There are several companies that are increasingly deciding to hold their cash in the form of silver bullion.  These companies are:

FSR.TO (First Silver Reserve)
SSRI SSO.V (SILVER STANDARD RSC)
SRLM.PK (STERLING MINING)
EDR.V EDRGF.PK (ENDEAVOUR SILVER)

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The Silver Valley in Idaho is bringing back the use of silver as money.  A silver one-ounce coin, a “Sterling” to be used as a $10 piece.
http://shoshonenewspress.com/index.asp?Sec=News&str=2869
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For news on the New Hampshire Sound Money Bill, that proposes to use U.S. Treasury minted Silver Eagles and Gold Eagles as money see:  http://www.goldmoneybill.org/

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There are two excellent annual silver surveys that are sponsored by industry.

The survey by silverinstitute.org costs $195
http://silverinstitute.org/wssum05.pdf — 10 page free summary of 2005 report.

The survey by cpmgroup.com costs $150, 162 pages.
http://www.cpmgroup.com/SSpress2004.pdf –3 page press release.

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Here are two U.S. Government produced reports on silver, containing data on years from 1900 to present, on U.S. & world  production, and U.S. consumption, and U.S. industry & government stockpiles.

Report #1
http://www.goldismoney.com/ssr/USsilver.xls
Report #2
http://www.goldismoney.com/ssr/USsilver2.xls

I evaluated these government produced reports in my silver stock report #36.

In sum, we are running out of silver.  The U.S. government had over 3 billion ounces of silver in 1940, and today, has very little left, or none.

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The Commodities Futures Trading Commission

The CFTC report on the allegations of manipulation in the silver market
http://www.cftc.gov/files/opa/press04/opasilverletter.pdf  — 9 page report
The CFTC report confirmes much of the research above, and almost outlines the bullish case for silver!
–My comments on the CFTC report are in silver stock report #34 & #35

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Silver consumption, per capita, in the U.S. is the same today, in 2004, as it was in 1945. 

And what is the per capita consumption of silver in the U.S. today?  5500 tonnes x 32152 = 177 million ounces of silver used per 285 million people.  177 / 285 = .62 oz. silver consumed per year, per person, in the U.S., whether in 1945, or in 2004.  Each person in the U.S. today, on average, uses 6 tenths of an ounce of silver.  
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As the New York Times, January 11, 1859, page 2 said— 
“It is well known that the most colossal fortunes the world ever saw have been based on silver mines…” 
–quote found by Charles Savoie

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My 2005-2010 price predictions for gold and silver: 
2005: $595/oz. gold,  50:1 ratio = $12/oz. silver
2006: $1011/oz. gold,  30:1 ratio = $34/oz. silver
2007: $1719/oz. gold,   10:1 ratio = $172/oz. silver
2008: $2923/oz. gold,  5:1 ratio = $ 585/oz. silver
2009: $4,969/oz. gold,  1:1 ratio = $4969/oz. silver
2010: $8448/oz. gold, 5:1 ratio = $1698/oz. silver
2011+: infinity dollars/oz. gold, infinity dollars/oz. silver.

I just moved up the years, one each from last year.  The reason why I’m so bullish is the scarcity of silver, and also, I believe one single billionaire could move the price, at any time, to $25/oz.  It would be folly of me to suggest that 2005 should see an average of $8-10/oz. for silver.  It could fly high, starting at any time.

I calculate the gold price rise by guessing that by 2010, 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.

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

See also Douglas Kanarowski’s article:  What Impact Will Digital Photography Have on Silver?

Doug’s third article is also excellent: Silver — the next big thing in the global markets? Answering A Few Silver Questions

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See the 600 year silver chart to see how undervalued silver really is:
http://goldinfo.net/silver600.html

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

Over 3600 people have signed the silver petition to stop the manipulation at the COMEX:
http://www.PetitionOnline.com/comex/

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

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

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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.  Very 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, check the numbers and follow the links:

“The money chart”

      1,000,000,000,000: 1 Trillion dollars
             1,000,000,000: 1 Billion dollars
                    1,000,000: 1 Million dollars
$200,000,000,000,000: Estimated total derivative exposure of all banks in the entire world. (20 x U.S. GDP)
$118,000,000,000,000: World Global Capital Markets (Stocks, Bonds, &?) Feb 2005 McKinsey Global Inst.
  $75,000,000,000,000: U.S. Govt. unfunded liabilities; social security, etc.
  $46,000,000,000,000: Est. World Money supply 2004; from M2 & GDP of EU, USA, Japan, & China (see SSR #56)
  $45,153,000,000,000: U.S. Household wealth, as of first quarter, 2004. (Includes Real Estate, and investments)
  $49,000,000,000,000: World bond market, Fall 2004 PWL Capital Inc.
  $37,000,000,000,000: Total global equity market capitalization June 2001 UN.ORG
  $21,000,000,000,000: U.S. bond market, Sept, ’03: IAPFtreas.gov
$12,192,000,000,000: U.S. GDP, 2005 (1Q)  http://www.bea.doc.gov/bea/dn/home/gdp.htm
  $17,600,000,000,000: Total global market capitalization of NYSE stocks, Sept. ’04  http://nyse.com
    $9,700,000,000,000: M3 (money in U.S. banks) July ’05  http://tinyurl.com/vra0 
    $7,839,000,000,000: US debt, 7-13-2005   http://www.publicdebt.treas.gov/opd/opdpenny.htm
    $2,400,000,000,000: U.S. annual budget 2005 
    $1,860,000,000,000: World “official” gold mined in all of history, 145,000 T (4.6 bil oz.) @ $400/oz. http://tinyurl.com/vrcc
       $450,000,000,000: Estimated silver mined in all of history: 40-45 billion oz?  @ $10/oz.  http://snipurl.com/93j1
       $754,000,000,000: Total U.S. paper currency & coin in circulation, March 2005  http://www.fms.treas.gov/bulletin/index.html
       $753,000,000,000: Annual U.S. current account deficit (trade deficit) for 2005, (annualized from 1 Q 2005).
       $596,000,000,000: U.S. debt increase (true deficit) (Fiscal year ’03-’04).  http://www.publicdebt.treas.gov/opd/opdpenny.htm
       $380,000,000,000: Market Cap of General Electric (biggest U.S. company) http://tinyurl.com/vrcn
$291,000,000,000: Debt of General Motors (biggest U.S. car company) July 2005
       $109,600,000,000: US gold, 261 mil oz., @ $420/oz. http://tinyurl.com/vsr9
       $100,000,000,000: all the world’s gold stocks/equities (estimated?)
         $75,000,000,000: Money flowed into Equity funds in the first quarter, 2004
    $16,000,000,000: Market Cap of Newmont July ’05 (biggest gold company in the world)
           $8,226,000,000: all the world’s “primary” silver stocks (80 of them on this list, as of June 25, 2004) –my own data.
$3,500,000,000: 350 mil oz. of “identifiable” silver bullion left in the entire world, according to GFMS @ $10/oz.
              $288,000,000: 40 mil oz. of “registered” COMEX silver bullion (1-05-05) @ $7.5/oz.  http://tinyurl.com/vrcw
                $56,250,000:  Limit 7.5 mil oz. of silver @ $7.5/oz. (limit of 1500 contracts per trader) at NYMEX
                $11,250,000:  Limit 1.5 mil oz. of silver @ $7.5/oz. potential 1 month delivery limit at NYMEX
                     $100,000:  Limit of FDIC insurance per bank account.
                         $5,000:  Limit of average cash withdrawl from small town banks, without ordering cash in advance.
                            $300:  Limit of average ATM daily withdrawl limit

So, what do all those stastistics mean?  (Besides the fact that real silver, and even paper money, is strictly limited?)

The numbers above are the real fundamentals of the silver and gold markets.  Silver and gold are money.  To study the potential demand for real money, we need to know how much paper money that exists that could, one day, show up as demand for real money.  

Note how General Motors has borrowed $290 billion, which is several times more than the value of the U.S. official gold hoard at $109 billion.  How did General Motors borrow more value in paper money than the entire U.S. has in real money?  

Note how the annual budget of the U.S. government, at $2.4 trillion, is greater than the value of all the gold ever mined in the history of the world, at $1.8 trillion.

Note how the value of the world bond market, at $49 trillion, far exceeds the value of the gold in the world, at just under $2 trillion.  Bonds are an investment type that directly competes with gold, and rather poorly in the last few years.  Bonds pay 1-5% these days, while gold has gone up from $250/oz. to $450/oz., a gain of 80% since 2001.

Note how extremely tiny is the silver market, relative to the tiny gold market, relative to the money and bond markets.

Now, a popular myth is that there is not enough gold and silver to do the work of money.  However, that is not true.  If gold and silver are valuable enough, there is always enough gold and silver to act as money.  

So, how valuable do you think gold and silver will get, when people start to sell overvalued stocks and bonds for real money, gold and silver, which are the only real alternatives to protect themselves from bankruptcies of companies like GM,  from bankruptcies of big banks, and from the continued inflation?

See, the value of bonds will go down, as interest rates must rise.  Interest rates must rise to match the capital gains that exist in the gold market–to get people back into bonds.  But gold is rising, what, 40% per year?  Imagine 50% interest rates in the bond market to draw people back to bonds!  GM will soon not be able to refinance their $300 billion in debt.  Imagine the capital destruction in the values of the bond market as interest rates rise, and as bond values move inverse to that from all the selling in the bond market.

The $49 trillion in the bond market MUST flow into the gold and silver markets as this process of debt destruction continues.

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 are 258 times more overvalued than gold.

Gold is overvalued relative to silver, because at current prices, it takes about 60 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 60 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 60 x 10,  You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 154,800 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 154,800 times more than they are worth today.  By that time, you should definitely sell the silver stocks, and buy gold.

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

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

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

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

So, if you want some fairly liquid alternatives to cash, in case you don’t know what other silver stocks to buy at the time, here they are:
1.  Buy silver.  You can hold silver in an IRA.
2.  Buy CEF.  Central Fund of Canada, ticker symbol CEF.  It’s gold/silver bullion fund.  It has 50 oz. of silver for every 1 oz. of gold.  The fund is fairly liquid, you can buy it as easily as any other stock, and is a good cash substitute.  Unfortunately, given the current ratio, about 55% or more of the value is in gold.
3.  Buy a fairly large cap silver stock, with fairly large volume, that is stilll fairly cheap on the list.  Canadian Zinc, Sterling Mining, IMA Resources, and perhaps Mines Management and Cardero are probably the best five candidates.  These all have market caps ranging close to $50-$100 million dollars or more, and are more liquid than many others.  (I used to recommend PAAS and SSRI for this kind of “liquid alternative”, but they are no longer as cheap, and the others have now increased in liquidity, and are now much more suitable for this kind of trading.)

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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 three to four years!  

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

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

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

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How bullish am I on silver?  Here’s an interesting way to put it: “60 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 60 times better.  Currently, the ratio is 60 ounces of silver can buy one ounce of gold or 60:1. 

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 60:1 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 60:1 to 40:1), then silver is moving up faster.  So, keep an eye on the ratio. 

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For a list of bullion dealers:http://www.silverstockreport.com/buybullion.htm

For a list of Brokers that handle Canadian issues and/or pink sheets:
http://www.bibleprophesy.org/SilverStockExtra.html

To track the ticker symbols of the 72+ stocks on this list at yahoo:  (Updated on July 12th, 2005)

TO TRACK THE STOCKS ON THIS LIST:  Click on yahoo finance.  Take a minute to register.  Sign in.  At the top of the page, click “create” a portfolio.  Choose “track your current holdings”.  In the large box, copy and paste the following symbols (Use your mouse to highlight the text below, then use control-C to copy, control-V to paste).

XAGUSD=X BHP SLW.TO GMBXF.PK BVN ABX IPOAF.PK CDE HL SIL GRS GAM.TO FSR.TO FSLVF.PK PAAS SIL CHD.V CHDSF.PK WTZ WTC.TO CFTN.PK PJO.V MFN MFL.TO SVL.V STVZF.PK SVM.V IAU.TO ITDXF.PK SSRI SSO.V FAN.TO FRLLF.PK FR.V FMJRF.PK CZN.TO CZICF.PK ORM.V OREXF.PK GGC.V GGCRF.PK IMR IMR.V ABI.V ABMBF.PK SHSH.PK YZC.V MGN SRLM.PK CSG.TO CSGLF.PK HDA.V HUSIF.PK RDV.TO RDFVF.PK ASM.V ASGMF.PK MGR.V MGRSF.PK CDY CDU.V AOT.V ASOLF.PK BCM.V BCEKF.PK OTMN.PK MCAJF.PK MAI.V MNEAF.OB EDR.V EDRGF.PK TVI.TO TVIPF.PK ECU.V ECUXF.PK SPM.V SMNPF.PK MMGG.OB EXN.V EXLLF.PK MAG.V MSLRF.PK KRE.V KREKF.PK CBE.V CBEFF.PK EGD.V EGDMF.PK SDR.V SDURF.PK APM.V EPZ.V ESPZF.PK QTA.V QURAF.PK SML.V SMLZF.PK SRY.V NJMC.OB PXI.V PNXPF.PK KG.V KDKGF.PK MMG.V MMEEF.PK GPR.V GPRLF.PK APE.V SSV.V CMA.V CRMXF.OB TM.V TUMIF.OB PDO.V GNG.V GGTHF.PK IPT.V IMPJF.PK GRG.V PCM.V PAOCF.PK MTB.V LSM.V LASCF.PK TBLC.PK AUN.V AUNFF.PK LEG.V LEGCF.PK CLZ.V ASLM.PK MVE.V

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

A good web site that hosts posting boards for many of the smaller canadian stocks (that Yahoo! finance does not have boards for) is stockhouse.com
Click on “Bullboards”.
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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 have made mistakes in the data from time to time. I’m human. I have collected the information from public sources such as company web sites and public information found at yahoo.com to get the stock prices. This report in no way guarantees the accuracy of the information below, since the information may change at any time. The number of outstanding shares can change as a company engages in new share issues to raise more capital through private placements, or if outstanding warrants (and options) are exercised and converted into shares, or if shares are bought back. Shares can be consolidated, or split. The number of ounces of silver in the ground can also change, as these are often only estimates. The number can also change up or down, depending on drilling results.

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

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

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

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

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

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

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

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

Contact the company.  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. 

Beware of scammers.  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 started an initial valuation process of the following silver companies to guide my own investment decisions. 

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(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)

The Market Cap is the usual tool to value a company.  It is what the company “costs to buy” if you could buy the entire company, all the shares, at the latest share price.  It is calculated by multiplying the share price, by the total number of shares that the company has issued.  In reality, you could almost never buy an entire company at the price of the Market Cap, but only a small portion.  Usually, even small buying pressure, such as trying to buy 1% of a company, can push up the price of a stock by up to 10-50% higher.  In my reports, I list Market Cap in terms of millions of dollars as “$75 mil MC”.

To calculate the Market Cap, I try to get and use the number of “fully diluted shares”.  A company creates shares when they sell them to investors in what are called “private placements”, or “initial public offerings” (IPO).  These usually consist of shares and warrants, sold for cash that the company will need to grow and expand.

The “outstanding shares” is the number of shares that exist out there if you count them all, and it does not count the warrants, which are like options. The investor can “exercise the warrants” which is a right, but not an obligation, to buy more shares from the company at the set price of the warrant.

If the company does well, and the stock price moves up, all the warrants will be, or should be, exercised and converted into shares, especially if they become “in the money”, and the warrants are significantly cheaper than the stock price.

Now, “fully diluted shares” is the total number of shares, plus the warrants, counting warrants as if they were all exercised and became fully trading shares.  I think “fully diluted shares” is a better number to use to calculate market cap than by using “outstanding shares” as most do. 

Finally, I go beyond valuing a company based on Market Cap alone; instead, I value a company by dividing the Market Cap by the assets of the company, which are usually the silver reserves in the ground.  Thus, I can get a sense of what you are getting for what you are paying.   And then, I denominate the whole thing in terms of silver, and not dollars, to get a more constant measure.

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(These first several companies below: –all look to be way too expensive to buy for the silver exposure for your portfolio.  They are listed here, not because I want to cover them, but because there are many investors who will bring them to my attention and ask about them if I neglect to mention them.  

BHP Billiton Ltd (BHP) 
KGHM Polska Miedz
Grupo Mexico SA de CV (GMBXF.PK)
Compania de Minas Buenaventura SA (BVN)
ABX (Barrick)
IPOAF.PK  (INDUSTL PENOLES)
HL (HECLA MINING CO)   
SLW SLW.TO CHAP MERCANTILE INC (Silver Wheaton)
CDE  (COEUR D’ALENE)

BHP Billiton Ltd (BHP) 
http://www.bhpbilliton.com/
web.queries@computershare.co.uk IR
–‘produces 40 mil oz. silver annually from one mine’ –the Cannington Silver Mine
Additional comments:  unfortunately, BHP has a 84 Billion market cap, (June 2005), so we can’t buy BHP for the silver exposure.  IE, $84 Billion / oh, say, 1000 million?????= $84/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.  

KGHM Polska Miedz
http://www.kghm.pl/en/index.php
ir@kghm.pl
–KGHM is the world`s sixth-largest coppper producer and second or third in silver.
1163 tonnes of silver produced in 2001.
1163 x 32152oz.tonne = 37.4 million ounces of silver produced in 2001
–Copper/Silver mine in Poland.
–Market cap is about  $1.52 billion.
Market cap / oz production = $41 per oz. of silver produced per year.

Grupo Mexico SA de CV (GMBXF.PK)
http://www.gmexico.com/
http://www.gmexico.com/Html/contactUs.htm
651,646,640 shares (2002 annual report)
@ $4.00/share
$2606 mil MC
“Grupo Mexico ranks as the world’s third largest copper producer (copper at $1.24), fourth largest producer of silver and fifth largest producer of zinc.”
They produced 28.2 million oz. of silver, worth $129 million, in 2002.  (P. 5, annual report.)
Total value of produced metals: $2527 milllion. (but the company lost money in 2002).  They mainly produce copper, 900,000 tons worth $1.5 billion in 2002.  Thus, silver, at 2002 prices, is only 5% of their production value.  Silver is a by-product for them, not a main product.
I don’t have silver reserve figures, nor do I see any need to find them or add them, since they are not a primary silver producer, and I don’t think anybody would be buying them for the “silver exposure”.
If we assume 280 mil oz. of silver (ten years reserve for production), then we stilll don’t have anything exciting for the silver alone.
$2085 mil MC / 280 = $7.45/oz. cost.

Compania de Minas Buenaventura SA (BVN)
http://www.buenaventura.com/
dhuguet@buenaventura.com.pe (IR)
NYSE:BVN
– Peru´s largest publicly traded precious metals company 
–produces over 10 mil oz of silver per year
–looks way too expensive for the silver alone: 2.8 Billion market cap.

ABX (Barrick)
http://www.barrick.com/
investor@barrick.com (IR)
533 million shares outstanding (June 2005)
@ $24.91/share
$13,290 million Market Cap
5.5 million oz. / year gold production.
–production hedged out for 2-3 years worth of total production, or about 13.5 million oz. (2004 annual) (most notorious hedger of the industry, the “leader”)
–price of hedges vary, and were changed from fixed prices, to variable & floating prices in 2004!
–reportedly, Barrick is trying to “unhedge”.
–reportedly, they plan to deliver 1/3 of production to hedges, which means they “might” be hedge free in about 10 years.
–the size of the hedge, 2004: 13.5 mil oz. gold, at $440/oz., would be valued at $5.9 billion dollars.  
–but they claim to be “debt free”, and don’t list hedged gold as a liability on the balance sheet… (only true if gold is not money)
–cash: $1,398 million (2004 annual)
Silver Reserves & Resources reported to be 997 million ounces!  (2004 annual)
Gold Resources 33 million oz. (2004 annual) (x 10 = 330 mil oz. silver equiv.
Gold Reserves reported to be 89 million oz. (2004 annual)  (x 10 = 860 mil oz. silver equiv.
Totals: 997 + 330 + 860 = 2187 mil oz. “silver equiv.”) 
$13,290 million Market Cap / 2187 mil oz. = $6.07/oz. silver
You may get “approx” 1.10 ounces in the ground for 1 oz. silver’s worth of stock… but up to 30 million oz. of silver may be hedged.

Additional comments:  
Over the years, Barrick has hedged their production, which many claim has helped to depress the price of gold and silver, by artificially adding to supply.  (Barrick’s promises becoming the extra supply.)  The declining price of the precious metals has put other miners out of business, which Barrick has acquired at low prices.  If Barrick goes bankrupt due to their hedges, and rising gold and silver prices, then perhaps Barrick’s many properties will, once again, be sold at distressed prices.  

Around the spring of 2003, ABX made an announcement about covering 30 million ounces of silver they sold short.  Then, a large buyer showed up in the futures contracts for about that amount.  

1 Q 2004 note on hedging silver, p. 33:  “At March 31, 2004, we had fixed-price commitments to deliver 22.3 million ounces of silver over periods primarily of up to 10 years.  We also had written silver call options on a notional 7 million ounces of silver with an average exercise price of $5.76 per ounce.  These options expire at various dates in 2004 and 2005.  The options are classified as non-hedge derivatives for accounting purposes.  Looks like they never closed out the silver hedge, but that they just bought options or futures that expired.

I expect silver bullion to continue to outperform ABX stock at these prices.   I don’t really count Barrick as a silver company… (and neither do they… they list sales of silver as “by-products” and “incidentals” in the 2004 annual report. Let me be abundantly clear.  I primarily list Barrick because people ask about it (because many novice precious metals investors own it) to show how poorly it compares to all the rest, and to help show how much better the rest compare.  This is a “comparative valuations” report, after all.

IPOAF.PK (INDUSTL PENOLES)
http://www.penoles.com.mx
397.5 mil shares outstanding (2003 annual, unchanged since 2001)
@ $4.75/share
$1888 mil MC
419 proven and probable reserves of silver (from 2002 annual report on web site)
$1888 mil MC / 419 oz. silver = $4.51/oz.
You get “approx” 1.57 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.  Produced 21.5 mil oz. silver 1 Q 2004 (Net earnings of $342.5 million 1 Q 2004)

The word late Feb. 2004 from ECU Mini, who reported to lemetropolecafe.com, is that Penoles hedged silver at low prices.  As reported at lemetropolecafe.com, “We know the market is so tight even the world’s largest silver producer, Mexico’s Penolas, wasn’t thrilled about supplying 1 million ounces for a special project with ECU Silver, led by their extremely able CEO Michel Roy.”

From 2003 annual statement, by Dec 31, 2003, Penoles hedged 1.5 million ounces of silver at $5.31/oz.  That looks to be a bad bet, but easily coverable for Penoles.  They bought an option to sell (put) 17 million ounces of silver at 4.94.  Another bad bet.  Totally wasted money, it appears to me.  They also have an option to buy 8.5 million ounces (call) at $5.53.  Not bad.  Such hedging practices, win or lose, make it more difficult for investors to know and guess the current operational state of the company.  Who knows whether Penoles will lock in more silver, and take away the upside potential profitability for shareholders, or even waste money on put options that will never be exercised.

Whether Penoles hedged an entire 2 years worth of production by Feb, 2004, I don’t know, and remains to be seen.  Penoles also engages in hedging dollars in the foreign exchane markets, further complicating matters.

77 million oz. silver refined by the metals division in 2003, and 1 mil oz. gold.
They probably refine almost all the silver that comes out of Mexico.
They produce about 48 mil oz. of silver from their mines 2003, and they have expansion plans.  

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 web site or in the annual report.  There is no need for a Mexican company to comply with Canadian law, 43-101.  When CDE recently complied with 43-101, they raised their total numbers by about 30-50%?

Given the report in March, 2004, that Penoles has hedged silver for two years, I expect silver bullion to continue to outperform IPOAF.PK stock at these prices.

HL (HECLA MINING CO)
http://hecla-mining.com/
hmc-info@hecla-mining.com (208) 769-4100
118 mil shares outstanding (June 2005)
@ $4.15/share 
$491 million Market Cap (MC)
no debt, cash: $81 mil (Dec. 31, 2004)
La Camorra gold mine, 563,000 oz gold.) (x 10 = 5.6 mil oz silver equiv.
San Sebastian silver mine, (proven & probable reserves) .4 mil (down from 8)
Greens Creek silver mine (proven & probable reserves) 33 mil (HL owns 30% of this, but the 31 mil oz. number reflects that percentage ownership.)
the Lucky Friday mine (proven & probable reserves) 11 mil. 
5.6 + .4 + 33 + 11 = 50 mil oz. proven & probable silver oz.
+ “Mineralized Material” Total Silver:
San Sebastian Unit            .7 mil oz. silver
Lucky Friday Unit      48.3 mil oz. silver
Sub total 49 mil oz. silver
+ “Other Resources” Total Silver:
San Sebastian Hugh (2)       4.1 mil oz. at 8 oz./ton
San Sebastian DS & F (3)      .7 mil oz. at 8.6 oz./ton
Lucky Friday Unit (4)       26.8 mil oz. at 10.3 oz./ton
Greens Creek (29.73%) (5)   10.9 mil oz. at 14.0 oz./ton
Sub total: 42.5 mil oz.
Total silver equiv. reserves & resources = 141.5 mil oz. (Feb 2005)
$491 mil MC / 141.5 mil oz. = $3.48/oz.

Additional comments: 
 HL likely 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. 

At the NY Gold show in June 2004, I spoke with Vicki Veltkamp, Hecla’s vice president of investor and public affairs, and I listened to her 15 minute presentation on Hecla at the show.  I felt that her presentation honored my work, since she focused on the fact that Hecla does not have substantial reportable reserves, due to the nature of vein mining.  She also emphasized that they already had detailed plans for spending all of their available cash, of $123 million, which implied that they had nothing left over to buy silver bullion.   Point: HL is not going to buy silver bullion with their cash anytime soon.  

One of Vicki’s arguments was that HL only produces 9 million ounces of silver, and that in a market that produces 500 million ounces of silver a year, that withholding production would not significantly move up the price.  I think she’s looking at the wrong numbers.  HL’s market cap has recently ranged from $600 million to up to $1,000 million.  The remaining silver at the COMEX, available for delivery in the registered category is only about 50 million ounces, not the 500 million ounes annually produced.  The available silver is valued, at $6/oz., at $300 million.  HL could issue 1/4 to 1/3 more stock than they already have outstanding, and use the proceeds to buy perhaps $300 million worth of silver bullion, and likely break the price to sky high levels, which would boost profits enormously.

If HL mines 9 million ounces of silver a year, at a cost of about $5-6/oz. (because their profits are slim), then if the silver price rises to about $33/oz, and other costs remain the same, HL could be making $250 million dollars per year.  It seems the largest silver companies have absolutely no vision about how they can affect the markets, and take a leadership role in the world of silver.  

I urged Vicki that HL should use their stock or cash, if not for buying silver bullion, then to acquire other silver companies, since I believe their stock is overvalued.  Vicki said HL does look at many acquisition opportunites, and would be interested in looking at others.

I expect silver bullion to continue to outperform HL stock at these prices.

SLW SLW.TO (Silver Wheaton)
http://www.silverwheaton.com
169 mil shares fully diluted.
178 mil oz. reserves & resources
@ $3.24/share 
$548 mil MC / 178 mil oz. = $3.07/oz.

Operating cash flow est. at $7/oz. = $30.4 million.
Annual Silver Production, 2005 est: 9.8 million ounces.

CDE (COEUR D’ALENE)
http://www.coeur.com
coeurir@coeur.com (208) 769-8155 or (800) 624-2824
240 mil shares outstanding (June 2005) not fully diluted
@ $3.41/share 
$818 mil MC
July 15th, 2004:  Cour Presents Resources in Cdn 43-101 form:
http://biz.yahoo.com/cnw/040715/id_coeur_d_alene_mine_1.html
Total of proven & probable reserves: 196 mil oz. silver (Feb 2005)
Total of measured, indicated, and inferred resources:  76 mil oz. silver, 1.4 mil oz. gold.  Total silver equiv: 90 mil oz.
(43-101 reporting increased the number from 189 mil to 279 mil oz. silver).  Before, Cour only reported reserves.
(Produced 14.2 mil oz. silver in latest fiscal year (early 2004)
$818 mil MC / 286 mil oz = $2.86/oz.
You get “approx” 2.44 ounces in the ground for 1 oz. silver’s worth of stock. 

Additional comments: 

Beware of dilution!!! At the end of 1999, there were 30 million shares out.  Today, there are 240 million.  

I expect silver bullion to continue to outperform CDE stock at these prices.
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The above list marks the end of the companies that I consider to be “very expensive”.  I don’t intend to make any further updates for perhaps the next year, unless their stock prices fall dramatically, perhaps by over 50% to 75% in many cases.  Otherwise, I just don’t see that re-evaluating those expensive companies is worth my time.
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GRS GAM.TO (GAMMON LAKE)
http://www.gammonlake.com/
gammonl@sprint.ca (902) 468-0614
83.5 mil shares fully diluted (April 30 2005)
+ 17 million special warrants
100 mil shares fully diluted (April 30, 2005)
@ $6.57/share 
$657 mil MC
Cash on hand of $75 mil Cdn April 2005
Total Ocampo “1.85-million gold ounces and 76.7-million silver ounces in the measured and indicated categories and a further 2.55-million gold ounces and 127.8-million silver ounces in the inferred category.”
Inferred: 2.55 mil oz. gold, 127.8 mil oz. silver
Silver equiv = 25.5 mil oz. + 128 mil oz. = 153.5 mil oz.
Measured & Indicated: 1.85 mil oz. gold, 77 mil oz. silver
silver equiv = 18.5 mil oz. + 77 mil oz. = 95.5 mil oz.
Total silver equiv: 249 mil oz.
Ocampo now has proven and probable RESERVES of 56 million oz. of silver, and 2.2 mil oz. gold. Reserves are a higher classification than resources, and come from a bankable feasibility study.
Gammon owns 26.3% of Mexgold, MGR
Since Mexgold owns 185 mil oz. of “target exploration potential”, 26.3% of that is 48.6 mil oz.
249 + 49 = 298 mil oz. (231 oz. in report #49)
$657 mil MC / 298 mil oz.= $2.20/oz.
You get “approx” 3.15 ounces in the ground for 1 oz. silver’s worth of stock.
**Note** most of Mexgold’s oz. that are added in are an “exploration target” not yet “inferred resources”.

Additional comments: Nov 11th, 2004 Gammon Lake resources Inc. annouces completion of bankable feasibility study for phase one of the Ocampo Gold-Silver Project.
“Independent Study Demonstrates Extremely Robust Economic Potential with Annual Production of 170,000 oz. of Gold and 6.2 Million oz. of Silver and an IRR of 65%.”  Project life: 6-7 years, calculated with an est. market gold price of $400 and silver price of $6.50

“Overall, a total of 130,000-metres have been drilled in more than 800 holes since the inception of the Gammon Lake Ocampo Project”

At prices of a 64:1 silver:gold ratio at $425/oz gold and $6.60/oz silver, the resources are worth $1048 million of silver, and $1411 million worth of gold.  Cash cost is $85/oz.  Life of mine is 7 years.  

FSR.TO FSLVF.PK (FIRST SILVER)
http://www.firstsilver.com/
info@firstsilver.com (604) 602-9973 or (888) 377-6676
38.7 mil shares fully diluted (1 Q, 2005)
@ $1.80/share Cdn x .82 US/Cdn = $1.48 US
$57 mil MC
Cash on hand, 2005 1Q: $3 million Cdn.
From the Company’s main page:
“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.)
(The company appears to mine about 2 million ounces of silver per year, so perhaps by mid 2005, that would be 7 million ounces mined out from reserves and resources?) 42 – 7 = 35 mil oz.
(The company recently retracted these “historical” estimates.)
First Silver owns 200,000 ounces of refined silver, preferring to hold silver, rather than paper dollars!
12 + 30 = 42 mil oz.
$57 mil MC / 35 mil oz. = $1.63/oz.
You get “approx” 4.26 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: –a high grade, producing miner.  The high grades, about 300g/ton, are a plus.   They are also actively exploring, another plus. 

1st Q, 2005, profits were nil, due to higher costs.

First Silver is unhedged, and remain committed to remaining unhedged.

PAAS (PAN AMERICAN SILVER)
http://panamericansilver.com/
info@panamericansilver.com (604) 684 -1175
72.3 mil shares fully diluted (Mar, 2005) from 1 Q 2005 report
@ $14.60/share
$1056 mil MC
Cash in hand, 1 Q, 2005: $106 million
+ 2.7 mil oz. silver (payable)
10 silver properties (3 in production)
estimated to produce 15 million ounces in 2005
Company lost $2.9 million 1 Q, 2005.  The company locked in prices for zinc and lead, and lost $6 million, unrealized, marked to market at the end of the quarter.
Reserves & Resources through Dec. 31th, 2004 from
http://panamericansilver.com/operations/reserves_resources.htm
Proven & Probable: 147.5 mil oz. silver
Measured & Indicated: 233.6 mil oz. silver
Inferred: 266.2 mil oz. silver
647 million oz. silver total.
$1056 mil MC / 647 mil oz. = $1.63/oz.
You get “approx” 4.25 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments:  Investors can buy Pan American silver at just over the spot price, ranging from $.70 (50-99 oz.) to as low as $.45 (5000 oz. minimum) over the spot price through the Northwest Territorial Mint.    See: http://www.silverpa.com/pricing.html

Pan American of Canada buys Morococha silver mine in Peru for US$35 million   This $35 million acquisition is a great deal for PAAS, and a minor help for PAAS shareholders.  According to the press release above, the silver mine produced 3.5 million ounces of silver a year, at a cash cost of $3/oz., which is great!  At $6.50/oz, that’s $3.5 x 3.5 mil oz. = $12.25 million per year profit after cash costs!  That gives the acquisition a P/E ratio for the mine’s acquisiton cost of under 3!  What a deal!  

PAAS LOST MONEY, first quarter, 2005.

The reason silver investors are investing in companies such as PAAS is for the upside potential of rising silver prices, and the leverage that silver stocks offer.  This leverage did not exist, I suppose, as mining costs must have risen faster than silver prices.

PAAS plans to produce 15 million ounces of silver in 2005.  Therefore, for every dollar the silver price rises, (IF other costs remain flat), PAAS expects to earn an extra $15 million, perhaps a small number for the large market cap.

Doing the math on that, PAAS would need about an extra $100 million in annual profits to get to a “reasonable” P/E ratio of 10.  This would require the silver price to rise to $13.33/oz.  Why?  Becuase by then, I would expect the price of PAAS to be fairly valued at a market cap of about $1000 million, with a P/E of about 10.  In the meantime, however, you could invest in silver bullion, and double your money.   Therefore, I think silver bullion may outperform PAAS shares.  On the other hand, if stock buyers bid PAAS up so that it has a P/E of about 20 by the time silver is $13.33/oz., (if that happens by next year, and is actually a reasonable expectation for a major) then PAAS and silver bullion may perform about the same.

Given that I expect silver and PAAS to perform about the same from these prices, and given that stocks are more risky, I would not buy PAAS even if they were to buy silver bullion with spare cash.  Yet, I advocate that PAAS buy silver bullion.  Why?  Because it would help their shareholders.  To be abundantly clear, I support buying silver properties as being a better investment than silver bullion at this point.  However, either silver bullion, or silver properties, are better than paper money, which PAAS has been holding for over a year now.

SIL (APEX SILVER)
http://www.apexsilver.com/
information@apexsilver.com (303) 839-5060 
47.7 million shares outstanding (March 31, 2005) (not fully diluted?)
@ $13.47/share
$643 mil MC
cash on hand: ~ over $500 million
San Cristobal (Bolivia) (proven & probably reserves) 454 mil silver
(The revised capital cost estimate amounted to $560 million)
(Produced zero silver in 2002)
7.8 billion pounds of zinc, and 2.9 billion pounds of lead
$643 mil MC / 454 mil oz = $1.42/oz.
You get “approx” 4.90 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: @ $13.35/share, about 78% of the value (market cap) of the company can be represented by the cash they have in hand.  22%, or about $141 million, would then be left over to represent the silver property.   Perhaps there is a downside of 22%.  However, if cash goes to zero value as silver rises in value, their “cash hoard” could evaporate!

See my silver stock report #40 for reasons why Apex will not likely use their cash to buy silver bullion while they wait for higher silver prices.

Apex silver primarily has institutional investors. 

“Apex has rights in some 100 mineral-exploration holdings at 34 properties in countries such as Bolivia, El Salvador, Mexico, and Peru.”

Apex has a lot of zinc. That’s an added bonus that is not factored in to my method of valuation. 

Apex is not mining now, but are waiting for higher silver prices.  George Soros, Billionaire, owns a bit of this one, his group of funds owns over 14% I read recently.  There are several other zinc / silver plays on this list that investors might also consider: Canadian Zinc, or Metalline 

WTZ WTC.TO (WESTERN SILVER)  (formerly Western Copper)
http://www.westernsilvercorp.com
info@westernsilvercorp.com Jay Oness Toll Free: 1-888-456-1112
50.5 mil shares fully diluted (Dec 2004)
@ $8.27/share
$418 mil MC
(not actively mining, no debt)
$64 million Cdn cash raised in Dec. 2004 financing, in addition to $14 mil Cdn previously.
The capital cost to get the mine going is estimated to be US $148 million
Western Silver Completes Pre-Feasibility Study on Chile Colorado Zone at Penasquito
The total measured and indicated sulfide resource at Peñasquito, including the March 31, 2004 resource estimate at the nearby Chile Colorado deposit, now stands at 272.96 million tonnes, containing 273.86 million ounces of silver, 3.61 million ounces of gold, 1,779 million pounds of lead and 4,503 million pounds of zinc.
274 mil oz. silver + 36 mil oz. silver equiv (gold) = 310 mil oz.
+ 29 mil oz. of inferred silver oxide resource.
They have 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.
$418 mil MC / 339 oz. = $1.23/oz.
$418 mil MC / 1000 oz. = $.42/oz. –exploration potential 
You get “approx” 5.6 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential = 16

Additional comments: Western Silver has a large zinc bonus, a copper bonus, and a gold bonus!

WTZ’s silver page: “Why Silver?”  While acknowleding the silver fundamentals as produced by the Silver Institue, and shrinking supplies, it says nothing about silver as money.  WTZ acknowledges their role is to make sure their shareholders are “well positioned to take advantage of any shortage of supply or rise in the price of silver.”

Western Silver was formerly Western Copper… Copper now at $1.35/lb!

Note the capital cost to get the mining started: $148 million dollars.   
WTZ also has the following other metal resources:
4.5 billion pounds of zinc x $.58/lb = $2.61 billion
673 million pounds of copper x $1.30/lb = $874 million
1.3 billion pounds of lead x .40/lb = $520 million

CHD.V CHDSF.PK (CHARIOT RESOURCES)
http://www.chariotresources.com/
ullir@chariotresources.com
235 mil shares fully diluted Feb., 2005
@ $.245/share Cdn x .82 US/Cdn = $.20 US
$47 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.
(Stilll much exploration work to do.)
The Marcona Copper project is a large potential “copper bonus”.
$47 mil MC / 32.7 mil oz. = $1.44/oz.
You get “approx” 4.8 ounces in the ground for 1 oz. silver’s worth of stock.

* CFTN.PK (CLIFTON MINING)  (I own shares)
http://www.cliftonmining.com/
clifton@cliftonmining.com 801-756-1414   (303) 642-0659 Ken Friedman
47 mil shares fully diluted  (May 2004)
@ $1.18/share US
$55 mil MC
http://www.cliftonmining.com/wsreview.htm   –source of 100 mil oz. resources est.
http://www.cliftonmining.com/resource.htm
From: http://www.siliconinvestor.com/stocktalk/subject.gsp?subjectid=13531
“A previous geologist has talked about a possible resource of 1 billion oz. of silver, and 5 million oz. of gold.”
“It took management almost 30 years to obtain every patented claim in this historic mine area, and to form them into one contiguous block of claims.  These claims were originally owned by as many as 100 surviving descendants of the original miners. “
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 has a complex JV agreement with Dumont Nickel. (DNI.V DMNKF.PK)   – exploring Clifton Mining’s property In sum, here is what Keith Moeller VP, Clifton Mining Company wrote to me:  “If Dumont produces a positive feasibility study on an individual property piece, then they gain a 50% interest in that piece alone, not in the rest of the property.  If they spend more than 5 million dollars (US) on any one piece and they produce a positive feasibility study on that piece, then they will gain a 60% interest in that one piece of property, not in the rest. If they stop at any time or fail to produce a positive feasibility, then they will gain no interest in any of our property.  Right now we have around 7 different pieces of the property that have “Stand Alone” mine potential.  If Dumont stakes or purchases any property within five miles of the joint venture property, then we automatically receive a 50% interest in that property.”
My problem is how to quantify that.  First, there is the range of potential silver resources.  Second, there is the range of potential ownership, which is highly variable, and not subject to the entire property, nor necessarily subject to spending by Dumont, but subject mostly to Dumont doing a positive feasibility study on each of many properties .  At the extreme ranges, the values are:
40% to 100% of 105 = 42 – 105 million oz.
40% to 100% of 1000 = 400 – 1000 mil oz. “exploration potential”
$55 mil MC / 42 mil oz. = $1.32/oz.
$55 mil MC / 1000 mil oz. = $.055/oz.
You get “approx” 5.3 ounces in the ground for 1 oz. silver.
Exploration Potential: 126

Additional comments: Goldseek.com is hosting a “Meet the CEO” session with Dr. Friedman of Clifton. If readers would like to send him some questions (open until Aug. 23), see:http://www.goldreview.com/MeetCEO/ask.php

Note the “exploration potential” is very large, but it also assumes that their JV partner, Dumont, does not acquire any interest in the property at all. 

Perhaps an interesting and novel way to determine percentage ownership of the projects would be to look at the relative market caps for both Clifton, and Dumont, and then assume that the market has it “about right”, and then use thier relative values to determine a possible percentage ownership of each.  And then, simply decide to own both, keeping your percentage ownership of each company, about the same.  For example, if the MC of Clifton is $43 mil, and Dumont is about $10 mil, so own about 4.3 times as much Clifton as Dumont.

JV agreements were primarily entered into during a time when it was difficult to raise money through share offerings, as a way to advance the projects.  Unfortunately, JV agreements also make it difficult for investors to value a company!  Several companies at the NY Gold show in June were just completing buyout agreements (or working on doing so) with their JV partners.  

For more info on what’s going on with Clifton, see http://www.dumontnickel.com , JV partner.  One man suggested buying both Clifton and Dumont to ease the difficulty in trying to figure out their JV agreement.
…………….
Clifton has 25% ownership of a biotech firm, ABL, that makes a colloidal or nano silver.  The biotech firm 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. The product cures malaria.

If you are a Shareholder of Clifton Mining, you can call the company directly, and order the colloidal silver from the company at a substantial discount to the offer below.  Shareholders can buy the ASAP solution for $8/bottle, but you have to order a minimum of a full case of 50 bottles at a time, for $400. 

You can now order the colloidal silver solution online, by the bottle, at http://www.asapsolution.com
To receive 10% off, use 50105 as the coupon number.
Clifton announced a JV agreement with General Resonance to help with their ASAP solution.  Clifton gave Congressional Testimony that really explains the incredible story behind their ASAP product.http://www.cliftonmining.com/congressionaltestimony.pdf

(I own shares of CFTN.PK)

PJO.V (PALMAREJO GOLD CORP)
http://www.palmarejogold.com/s/Home.asp
Gerri Paxton (Ms.) 450-677-2054 gpaxton@pjogold.com
87.3 mil shares fully diluted (April 31, 2005)
@ $2.21/share Cdn x .82 US/Cdn = $1.81
$158 mil MC
cash on hand: $27 mil Cdn April 2005
In Mexico.
Recent offering at $1/share.
High grade, over 5 gram/ton gold.
Bolnisi Gold, (Australia) owns 80% of PJO.V
The current value is approx 60% in silver and 40% in gold. 
Inferred Resource as of Oct 2004:  126 mil oz. silver & 1.177 mil oz. gold.  
June, 2005: 3RC & 3DD rigs currently exploring/developing the current resource.
Silver equiv at 10:1 ratio = 138 mil oz. silver.
$158 mil MC / 138 mil oz. = $1.15/oz.
You may get “approx” 6.05 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: Open at strike & depth.

MFN MFL.TO (MINEFINDERS)
http://www.minefinders.com/
info@minefinders.com
39.8 mil shares fully diluted 1 Q 2005
@ $4.48/share
$178 mil MC
Cash on hand, At March 31, 2005, $38.67 million C$34 million
At 70:1 ratio, 3.5 mil oz. gold x 70 = 245 “silver equiv” of gold, and 160 mil of silver = 405 mil oz. silver equiv. total.
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.”
The Dolores project is an advanced stage gold-silver resource, containing a measured and indicated resource of 97.3 million tonnes at an average gold-equivalent grade of 1.54 grams per tonne: 2.75 million ounces of gold and 128 million ounces of silver. Additional inferred resources of 650,000 ounces of gold and 28 million ounces of silver have also been delineated.
$178 mil MC / 195 mil oz. = $.91/oz.
You get “approx” 7.59 ounces in the ground for 1 oz. silver.

Additional Comments:  
At 70:1 silver to gold ratio, over half of MFN is in gold, so consider that a significant gold bonus. 

* SVL.V  STVZF.PK (SILVERCREST MINES) (I own shares)
http://www.silvercrestmines.com/
info@silvercrestmines.com (604) 691-1730 
31.5 mil shares fully diluted (Jan 31, 2005)
Principals’ Shareholdings are 27% of issued
@ $.65/share Cdn x .82 US/Cdn = $.53 US
$17 mil MC
$3 mil cash in the till.
El Salvador – El Zapote Project: Indicated and Inferred silver:  14.3 mil oz. silver
Guatemala – Concepcion Concession (pending):  includes several past producing silver mines.  documented results of greater than 13,714 g/t silver  — a historical resource of 1.9 million tonnes grading 86 g/t (2.5 opt) silver (4.75 mil oz., non- 43-101 compliant)
Mexico – Silver Angel Project– a 100% interest in 10,300 hectares located in the northern Sierra Madre Range… with structural features that host seven past producing, high grade silver-gold mines. –currently exploring this project.
Totals:  14.3 + 4.75 = 19.05 mil oz.
+85 million pounds of zinc, indicated and inferred. 
I’m no longer counting resources in Honduras, El Ocote & Opoteca, totalling 32 mil oz. silver.  The Honduran government seems as if it is not respecting property rights of foreign investors.  
$17 mil MC / 19 mil oz. silver = $.88/oz. 
You get “approx” 7.85 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: PP: 3,100,000 units on Dec 8th, 2004 @ $.90 with 1/2 warrant @ $1.20
SilverCrest Announces El Zapote Drill Results
Wednesday October 13
including 10.5 oz/ton over 249 ft.

The two projects of current focus are in Mexico and El Salvador, (nothing in Honduras at the moment).  The El Salvador project is moving “full speed ahead”.  Depending on the study, hoping for produciton perhaps by Jan or July, 2006.  

I own shares of SVL.V 

SVM.V (Silvercorp Metals Inc.)
http://www.silvercorp.ca/
604-669-9397 info@sknresources.com
44.7 mil shares fully diluted (May 10, 2005)
@ $2.72/share Cdn x .82 US/Cdn = $2.23
$100 mil MC
Working Capital: $5.5 million 
In China.
Up to 45 oz./ton!
Indicated 15 mil oz. silver, Inferred 115 mil oz. silver (130 mil oz. total)
$100 mil MC / 130 mil oz. silver = $.77/oz.
You get “approx” 9.05 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments:  
Silvercorp Metals Inc. formerly SKN Res.  Very high grade galena veins found in China.

IAU.TO ITDXF.PK (INTREPID MINRLS)
http://www.intrepidminerals.com/
scoates@intrepidminerals.com Stephen Coates, Investor Relations (416) 368-4525
49.4 mil shares fully diluted (June 15, 2005, extrapolated from 1Q, 2005, assuming warrants at .80 expired)
@ $.51/share Cdn x .82 US/Cdn = $.42 US 
$21 mil MC
$2.9 million cash, 1Q 2005
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 – 15 mil oz.
Argentina – 10 mil oz.
605,000 oz gold (240k in El Salvador, 365k in Argentina) At 10:1 ratio, 6 mil oz. silver equiv.
Total: 30 mil oz. silver
Total: 30 mil oz. “silver equiv”. (exploration potential or indicated or inferred, not reserves)
$21 mil MC / 30 mil oz. = $.69/oz.
You may get “approx” 10.1 ounces of silver of 1  oz. of silver’s worth of stock.

Additional comments:  Intrepid Partners Advance Projects and Discover More Gold and Silver
–Aug 18th. (Intrepid and Silvercrest in El Salvador)

More drill results released on March 3, 2004:
Intrepid Intersects 10.3m (34ft) of 70.9 g/t (2 oz/t) Gold and 988 g/t (29 oz/t) Silver at Kamila, Argentina

The stock price exploded, nearly doubling, in response to the news of the above drilling results.

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.

SSRI SSO.V (SILVER STANDARD RESOURCES)
http://www.silver-standard.com/
paull@silverstandard.com (604) 689-3856 or (888) 338-0046
54.9 mil shares fullly diluted (Dec. 2004) –from annual report
@ $11.31/share
$621 mil MC
debt free, cash: $Cdn 36 mil plus 2 million ounces of silver, plus securities.
As of May 12: The company has budgeted $8.2 million in 2004 for feasibility and scoping studies and exploration of its 15 projects.  With cash of $61 million, and marketable securities of approximately $10 million at March 31, the company decided to invest approximately 20% of its cash and securities in physical silver following the decline in silver prices in April and May.  Silver Standard now owns over 1.95 million ounces of silver.  This silver is held on an allocated and segregated basis and, consequently, is not available to be loaned.
not mining or producing; 23 silver properties
Resource summary from May, 2005 presentation
Total Measured: 101.9 mil oz. silver, 270,000 oz. gold
Total Indicated: 441.0 mil oz. silver, 585,000 oz. gold
Total Inferred: 440.0 mil oz. silver, 1,389,000 oz. gold
Grand Totals: 982.9 mil oz. silver + 2.24 mil oz. gold (x 10)
= 1005 million oz. silver
$621 mil MC / 1005 mil oz. = $.62/oz.
You get “approx” 11.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:   
Congradulations to SSRI for converting some of their cash, 20%, to silver bullion!  I wish it was more, but it is certainly a great start!   SSRI decided to hold such a large percentage of their cash in the form of bullion, first, of all silver miners!  

SSRI now has more silver resources than PAAS.  I continue to expect that SSRI’s market cap will exceed that of PAAS.

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 resources through drilling and acquisition.  This company seems to really understand the silver story, and helped to educate me as an investor.  

I attended a two hour SSRI presentation after the Gold show in SF in late November, 2003.  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.  

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

FAN.TO FRLLF.PK (FARALLON RESOURCES) 
http://www.farallonresources.com/fan/Home.asp
info@hdgold.com (800) 667 2114 (604) 684 6365  Melanee 
138 mil shares fully diluted (May 31, 2005)
@ $.51/share Cdn x .82 US/Cdn = $.42 US
$58 mil MC
$24 mil Cdn cash in the bank. Debt free.
Exploration and development in Mexico.
Managed by Hunter-Dickinson http://www.hdgold.com
On 4 sulphide deposits out of 16, 29 mil tonnes of ore grading 89 grams silver/t and 1.57 g gold/t.
Conversion: 89 grams x .03215 troy oz./gram = 2.86 oz./t silver
RE: those 29 mil tons, they “anticipate increasing resources to 50 mil tonne range…”
2.86 oz./t silver x 29 mil tons = 83 mil oz. silver
1.5 mil oz. gold x 10 = 15 mil oz “silver equiv”.
Total: 98 mil oz. silver equiv. 
(Pre-Feasibility study expected late summer 2005)
(Exploration potential = x 1.7 = 167)
(Minus:  The recoveries on low grade ores such as this are typically not 100%, but may be more like 50-85%, but it also depends on which metal in the polymetalic deposit that they most focus on extracting, and also depends on advances in technology.)
$58 mil MC / 98 mil oz. silver equiv. = $.59/oz.
$58 mil MC / 167 mil oz. silver equiv. = $.35/oz. –exploration potential
You get “approx” 11.8 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential = 20

Additional comments:  Farallon Completes Cdn $20 Million Financing Wednesday January 5
28,571,877 units at $.70 with warrants at $.80, hold time ends on April 18, 2005.

(No further financings expected, company has money up until a construction decision.)

The new drill results contain much higher levels of zinc than previous drilling, 4-8% compared to 2%.

The prior drilling was done in 1999… because of low zinc prices: 46% of the price of the metals was in the zinc before prices crashed…  The largest componant in late 2003 was gold, which was surprising to Eric, the IR guy I spoke with last year.  About 1/3 is in silver now.

At Feb 2005 metals prices, per ton:  
2% x 2000 lb = 40 lbs zinc x $.61/lb =  $24 for the zinc  
3.14 oz. x $7.37 = $23 for the silver.
.055421 oz. x $425/oz. = $23 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.)

The stock once had a market cap of $450 million, Canadian.  

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.

SSRI SSO.V (SILVER STANDARD RESOURCES)
http://www.silver-standard.com/
paull@silverstandard.com (604) 689-3856 or (888) 338-0046
54.9 mil shares fullly diluted (Dec. 2004) –from annual report
@ $11.31/share
$621 mil MC
debt free, cash: $Cdn 36 mil plus 2 million ounces of silver, plus securities.
As of May 12: The company has budgeted $8.2 million in 2004 for feasibility and scoping studies and exploration of its 15 projects.  With cash of $61 million, and marketable securities of approximately $10 million at March 31, the company decided to invest approximately 20% of its cash and securities in physical silver following the decline in silver prices in April and May.  Silver Standard now owns over 1.95 million ounces of silver.  This silver is held on an allocated and segregated basis and, consequently, is not available to be loaned.
not mining or producing; 23 silver properties
Resource summary from May, 2005 presentation
Total Measured: 101.9 mil oz. silver, 270,000 oz. gold
Total Indicated: 441.0 mil oz. silver, 585,000 oz. gold
Total Inferred: 440.0 mil oz. silver, 1,389,000 oz. gold
Grand Totals: 982.9 mil oz. silver + 2.24 mil oz. gold (x 10)
= 1005 million oz. silver
$621 mil MC / 1005 mil oz. = $.62/oz.
You get “approx” 11.2 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:   
Congradulations to SSRI for converting some of their cash, 20%, to silver bullion!  I wish it was more, but it is certainly a great start!   SSRI decided to hold such a large percentage of their cash in the form of bullion, first, of all silver miners!  

SSRI now has more silver resources than PAAS.  I continue to expect that SSRI’s market cap will exceed that of PAAS.

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 resources through drilling and acquisition.  This company seems to really understand the silver story, and helped to educate me as an investor.  

I attended a two hour SSRI presentation after the Gold show in SF in late November, 2003.  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.  

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

FR.V FMJRF.PK (FIRST MAJESTIC) 
http://www.firstmajestic.com/s/Home.asp
info@firstmajestic.com
28.4 mil shares fully diluted (June, 2005)
@ $1.85/share Cdn x .82 US/Cdn = $1.52
$43 mil MC
Cash on hand: $4 mil May 2005
“First Majestic owns the La Parrilla Silver Mine located outside the city of Durango, Mexico. Silver production began in July, 2004. Production is running at 180 tonnes per day. Mine development and mill improvements are underway to advance production to 500 tonnes per day. First year production of over 1 million ounces of Silver is anticipated.”
First Majestic acquired the La Parrilla Silver Mine in Mexico, a former producing silver mine that closed in 1999 due to low silver prices.  Now re-opened, they expect to produce 175,000 tonnes a year at 300g/t silver, which means 1.8 mil oz. of silver produced per year.  The cost to mine is estimated at $25-30/tonne, and recovery is 85-90%.  Cash costs are expected to be $3/oz.  Producing 1.8 mil oz. of silver per year. 10 yr. mine life.
–First Majestic recently purchased the Dios Padre Silver Mine which conservatively contains approximately 57 million ounces of 456 gpt silver and appears amenable to open-pit mining. Preliminary work began in January to define the parameters required to bring the Dios Padre back in production as soon as possible.
–The Candamena Mining District was also recently acquired. This 5,215 hectare property hosts several highly mineralized areas. 1997 work including 60 drill holes of over 11,500 meters provided an estimated resource of 1 million ounces gold and 20 million ounces of silver amenable to open pit mining.
Two new acquisions:
1.  Dios padre Silver Mine: historic, 2002, a US company proved up 60 mil oz. silver. 465 g/t–not 43101 compliant.  Other historic, from 50 yrs ago, up to 200 mil oz.? also 4-5% lead and 2% copper.  Exploration potential: 300 mil oz. silver –expect to upgrade production to 2000 tpd.
2.  Candamina mining district.  1 mil oz. gold 20 mil oz. silver…, –expect to upgrade production to 2000 tpd, also.
La Parrilla, 20 mil oz. + Dios Padre, 60 mil oz. + Candamena, 20 mil oz.
Exploration Potential: 340 mil oz. silver.
$43 mil MC / 100 mil oz. = $.43/oz. 
$43 mil MC / 340 mil oz. = $.13/oz. 
You get “approx” 16.1 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential may be 55 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  The company recently attempted a financing at $2.50/$2.15/share, which was postponed.

In 2 years, by Dec 2006, First Majestic’s goal is to produce 10 mil oz. silver/year.

* CZN.TO CZICF.PK (CANADIAN ZINC) (I own shares)
http://www.canadianzinc.com/
czn@canadianzinc.com 1-866-688-2001
74 mil shares fully diluted (June 2005)
@ $.43/share Cdn x .82 US/Cdn = $.35 US
$26 mil MC
$13 million cash, Cdn, 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! Their 18 year mine plan consists of zone 3 only, but there are 12 mineralized zones on the property.)  
$26 mil MC / 70 mil oz. = $.37/oz.  
You get “approx” 18.6 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  CZN recently cancelled a private placement at about $.65, when the stock price dropped.

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 bankrupted 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 build the mine. They were 90% complete when bankruptcy hit. The value of those buildings is now perhaps over $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. High Grade ores:  
12% zinc/ton; = 240 lbs. zinc/ton x 61 cents/lb. = $146/ton for the zinc.
10.1% lead/ton = 202 lbs. lead/ton x 40 cents/lb. = $80/ton for the lead.
                                6 oz. silver/ton x $7.00/oz. = $42/ton for the silver.
0.4% copper/ton = 8 lbs. copper/ton x 1.50 cents/lb. = $12/ton for the copper.
Total: $282/ton!   Prices accurate as of Mid Feb., 2005
With 11 million tons, CZN has about $3 billion worth of ore in the ground, at least.
3.  My method of valuation:  I’m really counting only the silver, not the base metals in my “oz in the ground” valuation.  So consider a major “zinc bonus”, and “lead bonus”.
4.  Zinc and base metals prices headed up!  Check http://www.metalprices.com/ for updates.  

(I own shares of Canadian Zinc)

ORM.V OREXF.PK (OREMEX RESOURCES)
http://www.oremex.com/s/Home.asp
info@oremex.com
29.3 mil shares fully diluted (April 8, 2005) 
@ $.60/share Cdn x .82 US/Cdn = $.49 US
$14 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 mannagement that have put other properties into production:
Anthony R. Harvey, Chariman, has put 14 properties into production in his 40 year career.
http://web1.kitco.com/pr/1582/article_03082005131131.pdf
March 8th, 2005: 39 mil oz. silver “contained resource” (43-101) at 4 oz./ton
$14 mil MC / 39 mil oz. = $.37/oz.
$14 mil MC / 100 mil oz. = $.14/oz. –exploration potential
You get “approx” 18.8 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 50

Additional comments:  Oremex intersects 20 oz. of silver per tonne over 292 feet  Wednesday September 8

Tejamen property in Mexico: Oremex reports exceptional high grade intercepts
36 ounces per tonne over 92 feet including 76 ounces per tonne over 39 feet.
A mineral resource study is underway and expected to be announced by the beginning of March 2005

GGC.V GGCRF.PK (GENCO RESOURCES)
http://www.gencoresources.com/
info@gencoresources.com IR: Rob Blankstein: 604-682-2205, or
22.4 mil shares fully diluted (Feb 2005)
@ $.79/share Cdn x .82 US/Cdn = $.65
$15 mil MC
–Producer in Mexico.
http://www.gencoresources.com/reserves.html
Inferred resources: 484g/t silver x .03215 = (15.5 oz/t) x 2.3 mil t = 35.8 mil oz. silver
2.00g/t gold x .03215 = 148,000 oz. gold x 10 = 1.5 mil oz. “silver equiv”
385 x .03215 = … x 95k = 1.2 mil oz silver
40+ mil oz. silver equiv. resources
2002 production, 500,000 oz. silver, 9000 oz. gold
$15 mil MC / 40 mil oz. silver = $.36/oz.
You get “approx” 19.1 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments:  

As of April, 2004, Genco is producing 35,000 oz/month of silver, earning $100,000 Cdn/month, and expects to earn $1,000,000 Cdn/month by year’s end, 2004? by doubling both the tonnage and the grade.  Genco is also aggressivly planning on making property acquisitions.

* IMR IMR.V (IMA EXPLORATION) (I own shares.)
http://www.imaexploration.com/s/Home.asp
info@imaexploration.com
50 mil shares fully diluted (April 15, 2005)
@ $2.40
$120 mil MC
Exploring in Argentina.
$4.5 million cash
Silver Resources Increase to Over 300 Million Ounces at IMA’s Navidad Discovery
Thursday June 16
Indicated plus Inferred, from press release above total 339 mil oz. silver
The full exploration potential might be perhaps 1000 mil oz.
$120 mil MC / 339 mil oz. = $.35/oz 
$120 mil MC / 1000 mil oz. = $.12/oz 
You get “approx” 19.6 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential may be 58 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:   Silver and IMA Exploration – Hommel — 28 February 2005

IMA has several joint venture partners in the area in Argentina near Navidad.  See Tinka, Cloudbreak, Consolidated Pacific Bay.  Other companies are in the near area such as Pategonia Gold, Pacific Rim, and Silver Standard.  

IMA had many other silver properties that they just spun off into a new company, Golden Arrow. For every 10 shares of IMA existing shareholders got 1 share of Golden Arrow. (See below)

(I own shares of IMR.V)

SHSH.PK (SHOSHONE SILVER) 
http://www.shoshone-mining.com
Carol Stephan, director, 208-666-4070
18 million outstanding shares
@ $.18 US
$3 mil MC
Lakeview Mine and Mill: 24,190 tons of mineralized material delineated at Lakeview, grading an average of 11.8 oz/t silver.
= 285,000 oz. silver.  But is a narrow (high grade) vein mine, like Cour d’Alene and Hecla, with few reserves.
http://www.chestermining.com/
Historic estimate: “Conjecture (in Lakeview) 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 mil oz. silver.
“Terms of the 25-year lease [of the conjecture] include payment of a $3000 per year advance royalty, issuance of one million shares of Shoshone common stock to Chester, and a sliding scale net smelter return based on the spot price of silver.”  At .$60/share, that’s $.6 mil MC more for the lease.
Blende project in Yukon, Canada: 21.4 million tons grading 1.63 ounces per ton (oz/t) silver. (low grade) 35 mil oz. silver; + 1.3 billion pounds zinc, 1.2 billion pounds lead.
Now, 43-101 compliant!  Resource Estimate Completed on Shoshone Silver/ Eagle Plains’ ”Blende” Silver-Lead-Zinc Project
Wednesday October 6
Shoshone must issue 1 million shares, and spend $5 million on exploration by December 31, 2008 to complete its 60 percent earn-in on the blende project.  How to count that?  …???…  60% of 35 mil oz. silver is 20.9 mil oz. that will cost an additional $5 million, plus a million shares.  At $.60/share, that’s $5.6 million for 20.9 mil oz. resource.  That’s  $.34/oz. acquisition cost to Shoshone for blende, which they don’t own yet, just an option.  
Total: 8 mil oz. silver, plus an option on 20.9 mil oz. silver at blende.
$3 mil MC (plus $6.2 mil they need to raise to maintain leases) / 8 mil oz, plus 20.9 mil oz. (29 mil oz.) = $.32/oz.
You get options and leases that, if they raise money at the current share price, may give “approx” 21.3 ounces in the ground for 1 oz. silver’s worth of stock.

YZC.V  (Yukon Zinc) (formerly Expatriate Res)
http://www.yukonzinc.com/
info@expatriateresources.com 1-877-682-5474 Dr. Harlan D. Meade, President and CEO
198.7 mil shares fully diluted (Mar. 1, 2005) (listed on the front page of the web site!)
@ $.19/share Cdn x .82 US/Cdn = $.16
$31 mil MC
recent $16 million financing in Oct 2004
Mostly a base metals company:  Zinc!  Also has some silver & gold.
6 properties.  Most of the value is concentrated in the 100% owned Wolverine Project.
Wolverine has a resource of 6,237,000 tonnes grading 12.66% zinc, 1.55% lead, 1.33% copper, 371 g/t silver and 1.76 g/t gold.
Total silver mineralization across 6 properties:  97.2 mil oz. silver, 565,000 oz. gold, = 103 mil oz. “silver equiv.”
About 14.3 billion pounds zinc, also some copper and lead. (Including the new acquisition of the Howard’s pass project, thru 21% ownership of Pacifica Resources.)
$31 mil MC / 103 mil oz. silver = $.30
You get “approx” 23.1 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  
On Sept 8th, I wrote an article on Expatriate.  http://www.goldismoney.com/ssr/expatriate.html
http://www.gold-eagle.com/editorials_04/hommel090904.html

Huge, huge 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, but that assumes old low prices for silver, about $5-6?/oz.  My method of valuation puts a value on the silver only, not the rest, so this is a significantly better value than my number shows.

Call Dr. Harlan D. Meade, President and CEO 1-877-682-5474, and ask him to send you an information packet on YZC.V.  It contains a good report on why he is bullish on both silver and zinc.

RDV.TO RDFVF.PK (REDCORP VENTURE)
http://www.redcorp-ventures.com/
http://www.redfern.bc.ca/index.html
info@redcorp-ventures.com
85.1 mil shares fully diluted Aug. 2004
@ $.11/share Cdn x .82 US/Cdn = $.09
$8 mil MC
http://www.redfern.bc.ca/projects/tulsequah/exploration_resources.html#results
TULSEQUAH: 9 mil tonnes indicated and inferred at 107.5 g/t x .03215
= 31 mil ounces silver (3.4 oz/ton low grade silver, with other minerals)
(also have significant gold ($30/ton at $400/oz.) and zinc $60/ton at $.46/lb.)
728,000 oz of Gold x 10 = 7.3 mil “silver equiv”
= 38.3 mil oz. silver equiv.
$8 mil MC / 38.3 mil oz = $.20/oz.
You get “approx” 34.6 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: Declared not feasible enough to do a feasiblity study in Spring, 2005.  So, they may try to expand the resources.

RDV has a “gold bonus”.  At $409/ gold, and $6.50/oz. silver,  it’s about $300 million worth of gold, and $200 million worth of silver, or about 60% of the value is in the gold.  Since my method really undercounts the gold, this means there is a significant “gold bonus” here.

* ABI.V ABMBF.PK  (Abcourt Mines) (I own shares)
http://www.abcourt.com/ 
jobrien@abcourt.com Joe O’Brien (416)750-8041
39.8 mil shares fully diluted (July, 2005)
@ $.21 share Cdn x .82 US/Cdn = $.17
$7 mil MC
$1 million cash on hand
no debt., North of Montreal., ~11 mil shares family owned.
proven reserves… not ready to be opened, re-opened perhaps in mid 2005?
–Abcourt-Barvue: Past producer, existing infrastructure: Put into production a second time, 1985-1990 for $20 million.
—43-101 numbers:: 20.7 mil silver ounces, 659 million pounds zinc
–Estimated cost to reopen the silver mine was (with the old plan) $35 mil Cdn: Estimated: 27.55% IRR, 98% return on equity, payback period of 2 years.
-The current plan is to do a summer drill program to expand resources.
Value of Current Resources: $402 million worth of zinc at .61/lb,  $145 million worth of silver @ $7.50
$7 mil MC / 20.7 mil oz. = $.33/oz.
You get “approx” 21 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Renaud Hinse took a trip to Vancouver and San Franciso, and came out to Grass Valley, California my hometown, to meet with me late August, 2004.   Abcourt has been in business as early as 1977.  The mine last operated from 1985 to 1990.  In 1980, the stock price hit a high of $4.95/share.  In 1985, they raised and spent $20 million Cdn. to start production, and in 1990 production was put on hold due to low silver and zinc prices.

Imagine trying to run a business for 14 years with no revenue!  Yet, during that time, they have managed to keep the company debt free, and dilution to a minimum!  Yearly costs to keep the claims and equipment of this family-run mine are $100,000, so that has been their secret of survival.  

–looking to raise $5 mil to reopen the silver/zinc mine. 

(I own shares of Abcourt)

* SRLM.PK (STERLING MINING) (I own shares)
http://www.sterlingmining.com/
RDemotte@aol.com Ray DeMotte 208 666 4070
12.2 mil shares outstanding (May 31, 2004)
16.6 mil shares fully diluted (May 2004) –(To get the latest number, I have to call Ray DeMotte.  Note the date.) 
@ $3.30/share 
$55 mil MC
~185 mil oz. reserves + resource, Sunshine alone
Quote from: http://www.sterlingmining.com/jun112003.html
“The prior operator last estimated the mine reserves at 26.75 million ounces of silver, 10.36 million pounds of copper and 7.05 million pounds of lead (or approximately 28.85 million ounces of silver-equivalent), as well as an additional resource of 159.66 million ounces of silver. “
Other properties:
Baroness   15 mil — tailing project, no further exploration potential, (construction finished, testing beginning)
Tesorito      17 mil — + exploration potential
San Acacio    14 mil  — + exploration potential
Total:  231 mil oz. silver
$55 mil MC / 231 mil oz. = $.24/oz. 
$55 mil MC / 550 mil oz. = $.10/oz.  (exploration potential)
You get “approx” 29.3 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential is 69.)

Additional comments:  Silver & Sterling Mining – Hommel — 01 April 2005

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, and refurbish the mine.

Sterling Mining acquired the Sunshine mine. Sunshine had “more than 360 million ounces of production over the past century” and 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. 
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.”

For more detailed information on what’s happening in the Silver Valley in Idaho, see the following link:
http://www.blanketpower.com/mining/titlepage.htm

(I own shares of SRLM.PK)

* CSG.TO CSGLF.PK (Capstone Gold) (I own shares)
http://www.capstonegold.com
Chris Tomanik IR (604)-684-8894 ctomanik@capstonegold.com
42.7 mil shares fully diluted (August 2004)
+ 16 mil in Dec. 2004 financing
58.7 mil shares fully diluted (Feb 2005)
@ $.75/share Cdn x .82 US/Cdn = $.61
$36 mil MC
$~6 mil Cdn, cash on hand.
They did a $9.1 million PP at $.75/share Cdn. in Jan 2004.
6 mil warrants at $1.00-$1.25 Cdn.
Projects all in Mexico, past producers.
http://www.capstonegold.com/images/capstone_proj_sum.jpg
Cozamin is the largest property (gold/copper), for which drill results will soon be announced.
Six properties (Still need about $12 mil to fully acquire 90-100% over next 5 years, minus 3% NSR 
“net smelter royalty”)
Cozamin: indicated:  2.8 mil T x 85g/t Ag (7.4 mil oz. silver), .5g/t Au (44,000 oz. gold)
+ inferred: 3.1 mil T x 103 g/t silver (10 mil oz. silver), .5g/t Au (48,000 oz. gold)
High Grades range from about 200-300g/t silver. (6.5 – 9.5 oz. tonne)  –across 5 properties 
Totals: (excluding Cozimin):  115 mil oz. silver, 2.3 mil oz. gold. (138 mil oz. silver equiv)
Grand total: (including Cozimin):  156 mil silver equiv. ounces
Exploration Potential: up to 500 mil oz. silver at Claudia (580 mil total?)
(will require about $5 mil to secure properties, and they recently raised $10 mil)
$36 mil MC / 156 mil oz. = $.23/oz.
$36 mil MC / 580 mil oz. = $.06/oz.
You may get “approx” 30 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 112

Additional comments:   Large copper bonus.  Large gold bonus, too.

PP Dec. 16th, 2004, 10 mil units at $.85, with a half warrant at $1.25, + 1 mil agent options.  Hold time expires April 16th, 2005 –and I think is responsible for the recent price drop from about $1.20 to $.72/share.

Research Report: Capstone Gold Corporation – written by Mike Kachanovsky August 30, 2004.

Bill Murphy and I are in a contest of the speakers for Cambridge House.  Bill’s “stock pick” as of June 10th was ECU.V at $.26/share Cdn.  My “stock pick” was Capstone gold at $.72/share Cdn.  The contest is to see which stock outperforms by the Toronto show this fall, Oct 2-3. see goldshow.ca for info on the show.  Interestingly, I’m the silver bug, and I pick Capstone Gold, and Bill, the gold guy, picks ECU Silver Mini!  Interestingly, both companies had market caps around $30 million.  ECU: $30.5 mil US, CSG.TO: $34 mil US.

 (I own shares of CSG.TO)

HDA.V (HUSIF.PK) (HULDRA SILVER)
no web site
Phone: Magnus 1 (604) 261-6040
6.924 mil shares fully diluted (end ’03?)
@ $.30/share Cdn x .82 US/Cdn = US $.25
$2 mil MC
no debt
HDA’s proven and probable reserves stand at 161,000 tons of
ore grading an average 25.6 ounces per ton silver, and 10 percent combined
lead/zinc — 4.12 mil oz silver, not including the zinc & lead.
According to Magnus, the indicated and inferred reserves total about 180,000
tons at about the same grading — in other words, a further 4 million ounces of
silver.
~8 mil oz. silver
$2 mil MC / 8 mil oz. silver = $.21/oz.
You get “approx” 32.2 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 Cdn $3.5 million — with payback of capital (when equity financed) within two years.” 

* MGN (MINES MGMT) (I own shares)
http://www.minesmanagement.com/ 
info@minesmanagement.com (509) 838 6050 Doug Dobbs
12.4 mil shares fully diluted (April 2004)
@ $5.30/share 
$66 mil MC
261 mil oz. silver resources.  Previous drilling spent over $100 million drilling the property.   
$66 mil MC / 261 mil = $.25/oz.
You get “approx” 27.6 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Mines Management continues to work toward permitting and developing the Montanore Mine, hiring engineers, filing permits, etc., and has issue no new shares in almost a year, since March, 2004.

The revised plan for developing the Montanore Mine envisions an operation processing 12,500 tons of ore per day, yielding approximately 8 million ounces of silver and 60 million pounds of copper per year at a cash cost of under $2.90 per ounce.  (At a capital cost of approximately $236 million.)  

“The cash operating costs of the project remain attractive at approximately $12.14 per ton, taking into account inflation offset by increases in productivity from improved mining methodology and technology.”

About 2-3 oz silver/ton, 0.75% copper.

As copper moves up 5 cents/lb., it adds $100 million to the value of the deposit.  
As silver moves up $.50/oz., it adds $130 million to the value of the deposit.

Mines Management (MGN) 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 MGN 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 61% of the value (at current prices) in copper (copper recently at $1.43/lb.), 2 Billion pounds of copper, and 261 mil oz. of silver.  Doing the math: 
261 mil oz. silver x $6.70/oz. = $1.748 Billion. 
2 Billion lbs copper x $1.39/lb.. = $2.8 Billion. 
Total value of mineralization before costs to extract, $4.5 billion.  It was recently a high of: $4.8 Billion.   This number increased from around $3 Billion just a few months ago!  These numbers do not suggest a potential market cap value of the company.  The costs to extract that mineralization will be substantial, along the way.  However, if they are cost effective at today’s prices, and if metals prices double, then that is substantial profit, and creates the leverage investors seek.

They do not have an active working mine–which is a minus.  They will need to raise capital to get a mine going: $236 million current estimate.  

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 Noranda’s departure of the project in 2002.

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

Mines Management has a new Message Board at Yahoo! Finance:
http://finance.yahoo.com/q/mb?s=MGN

I own shares of MGN.  

* ASM.V ASGMF.PK (AVINO SILV GOLD) (I own shares.)
http://www.avino.com/
shares@avino.com 604 682-3701 — David Wolfin
10.5 mil shares outstanding. / 13.5 mil shares fully diluted (Dec. 2004)
17.5 mil shares fully diluted (including, and after the purchase of remaining 51% of the Avino mine)
@ $1.28/share Cdn x .82 US/Cdn = $1.05 US
$18.4 mil MC
from:    http://www.avino.com/other/goldstock100197.html –in 1997
“How Much Silver Does Avino Have?”
“Operations at Avino’s silver mine in Mexico are both open-pit and underground. I examined the reserves and interpolated the tonnage into silver ounces as follows: 28-million ounces proven; 50-million ounces probable and 27 million ounces possible.” (Not all are 43101 compliant reserves & resources.–that is an old, third party report.)
The Avino Mine operated from 1986 to 2001, producing about 497 tons of silver, 3 tons of gold, and 11,000 tons of copper.  That’s about 1.6 million ounces of silver per year.
Avino produced 166 ounces of silver for every one ounce of gold.  At a 60:1 value ration, that means that the value of silver to gold is 2.76 times as much value (today and historical) is in silver than gold.
They actually have over five silver properties/projects.  I only have numbers for one, the primary Avino mine 
= 28 + 50 + 27 = 105
Avino owned 49% of that, or 51.5 mil oz., prior to the purchase agreement for the remainder for an additional 4 million shares.
$18.4 mil MC / 105 mil oz. = $.17/oz.
You get “approx” 39.7 ounces in the ground for 1 oz. silver’s worth of stock.

Addional comments:  The Avino purchase is taking longer than anticipated.  The reason is that Avino is waiting for the approval from the exchange.  The Avino purchase agreement was agreed upon months ago, subject to exchange approval.  In the meantime, Avino has proceeded with a feasibility study that should more than satisfy the questions from the exchange.  And the feasibility study is anticipated in a few weeks, perhaps by the end of March, 2005.  The feasibility study should also detail how much money the company should need to raise to put the mine back into production.

The clear bonus with Avino is that they have a working mine, with existing infrastructure.  Many of the other exploration companies don’t have that.

(I own shares of ASM.V)

———————-

In case you didn’t notice, the list of companies, above, that have significant measurable resources, is in reverse.  The worst companies, that are the most expensive with the least resources, are listed first, and the better companies, with more resources at least cost, are listed last, just above here.  The list is done this way on purpose for several reasons, as follows.  First, the best companies are in the middle of the report (burried).  Second, it allows the reader to see the many other options available before seeing these ones.  Third, this means that this list is less likely to have a “pump and dump” type effect.  So, you have to “scroll up” to see the list from this point.

——————————-    ——————————-    ——————————-    

Explorers:

Explorers deserve their own category, since they cannot be valued by the 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.  A few explorers may also be producers, and they are both listed here, if they do not have significantly large well-defined resources.

This list, although at the bottom, in no way indicates that these companies are more highly valued, or less valued, than companies listed above.  There may be less certainty in the companies listed below, and more certainty in the companies 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. IE, everyone is an explorer!

The list above is not a list of producers, the list above is a list of companies with significantly measurable resources in the ground.  Those below, generally do not.  Or, if they do have resource numbers, the numbers are very small compared to their much larger exploration potential, and thus, they are listed here.

(The order in this list is by largest market cap first, not by “comparative value” of the market cap divided by the resources, as above.)

MGR.V MGRSF.PK (MEXGOLD RSCS)   
http://www.mexgold.com/
52.5 mil shares fully diluted (spring 2004)
@ $2.79/share Cdn x .82 US/Cdn = $2.29 US
$120 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.”
February Financing was for the El Cubo Gold-Silver Mine is located in the Guanajuato gold-silver district in the Republic of Mexico. Historical reports cite district production at 1.2 billion ounces of silver and over 4 million ounces of gold. With capital spending and upgrades, and expect to produce up to 100,000 oz. gold equiv/year at $190/oz. At $400/oz, that may mean $210/oz. net profit, or $21 million positive cash flow/year, and yet, the purchase price was $21.5 million.  Seems like they bought a mine, at a price, with a profit potential, of a P/E ratio of 1.  
Target to expand the El Cubo project resource to over 2 million ounces of gold equivalent.  Given that historic production was 300 oz. of silver for each 1 oz. of gold, I think it’s odd that they speak in terms of “gold equivalent”.  Why not emphasize the silver???  Converting their target of gold back to silver, at their ratio of 65:1, gives 130 mil oz. “silver equivalent”.
55 + 130 = 185 “exploration potential”
$120 mil MC / 185 mil oz. = $.65/oz.  That’s an “exploration potential target” 

Additional comments:  Gammon Lake is a large shareholder, 26.3%.  

Gammon Lake’s 25% Owned Mexgold Resources Announces New Exploration Results from El Cubo Gold-Silver Mine, Including the Discovery of a New Bonanza Grade Gold-Silver Zone
Thursday February 17
Sampling conducted along a length of 38-metres returned average grades of 70.9 grams per tonne gold and 505 grams per tonne silver, over average widths of 4.3-metres.

Mexgold announced bonanza grade discovery on Jan 13th, 11 kilos per ton silver, over 2 meters.
Part of a section of “25.5-metres grading 1.16 grams per tonne gold and 961 grams per tonne silver.”

CDY CDU.V  (CARDERO RSCS)
http://www.cardero.com/
hvanalphen@cardero.com  Henk Van Alphen — President (604) 408-7488  
40.6 mil shares outstanding (Jan, 2005 1Q)
+ 3.8 mil options
+ 3 mil warrants
47.4 mil shares fully diluted (Jan, 2005 1Q)
(many of Cardero’s properties require additional share issuances, requiring further detailed analysis, not provided here)
@ $2.49 US
$118 mil MC
($19 million Cdn cash in the treasury)

Additional comments:  In Jan., 2003, Cardero had three silver properties in Argentina, and was mostly focused on the Providencia silver property…  In Feb., 2005, Cardero has 6 properties in Argentina, 6 in Peru, and 7 in Mexico, for a total of 19 exploration properties.  I know that management is “elephant hunting”, meaning they are looking for properties with potential for very large, very big discoveries that will interest the major, multi- billion dollar mining companies.

Aug 17, 2004 Cardero Announces Results From Providencia
“Cardero is encouraged by these results although ongoing sample recovery problems remain a concern…”Providencia — high grades of silver, former silver mine, could have 100-250 mil oz.  ??

Chingolo — 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.  

June, 2004: Company quote: “The Company is actively evaluating silver, gold, copper and iron-ore projects which will ensure the recognition of Cardero as a world-class exploration and development company.”

Cardero Provides Update on Iron Oxide Copper-Gold Projects in Peru–Whether it is cost effective to extract potentially $100 billion worth of iron minerals remains to be seen, and is the job of an explorer like Cardero.

AOT.V ASOLF.PK (ASCOT RSCS)
http://www.ascotresources.ca/
1 604 684 8950
40.2 mil shares fully diluted. (Dec. 2004)
@ $.30/share Cdn x .82 US/Cdn = $.25 US
$10 mil MC (US)
—-
Additional comments: They own 5.723 million (Dec. 2004) shares of Cardero, which usually is a greater asset value than their market cap. Ascot’s share price is typically around 80% of the value of their Cardero Stock, and less liquid.)

Owns about $14 mil U.S. worth of Cardero Stock at closing prices on June 16th, 2005!

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

It may be better to buy Ascot than Cardero, depending on prices.  Check the math, and call Ascot to verify Cardero stock holdings, and number of shares.

BCM.V BCEKF.PK (BEAR CRK MINING)
http://www.bearcreekmining.com/s/Home.asp
info@bearcreekmining.com
39.2 mil shares fully diluted (April 2003)
@ $2.04/share Cdn x .82 US/Cdn = $1.67 US
$66 mil MC
Nov 18, 2004–Bear Creek Discovers New Bulk Tonnage Silver Target
     Vancouver, B.C. – Bear Creek Mining (TSX Venture: BCM) is pleased to announce that it has agreed to acquire a 100% interest in the Santa Ana silver prospect in southeastern Peru.  Surface sampling at Santa Ana has identified a large silver anomaly with bulk-tonnage potential. Four hundred and ten rock chip samples systematically collected at 100 meter spacing from outcrops, shallow workings (up to 3 meters deep) and prospect pits have outlined an anomaly 2.8 kilometers long and 600 meters wide that averages 80 g/t (2.6 opt) silver, 0.30% lead and 0.23% zinc. –What is that rock worth?  See kitcocasey.comOn Feb 23, it was $22.47/tonne.
–To be drilled, 2nd, Q, 2005.  (other samples had up to 111 oz. /tonne!)
–Drilling results have come in, and the stock EXPLODED July 12th, up 65% on 3 million shares traded.
The grades, at 3 oz/tonne on average, are relatively low, but the overall size of the project seems to be what caught investors’ attention.  4 holes, 900 meters apart, each hole about 100 to 190 meters deep, over a 1.5 kilometer target.  Mineralization is open at depth, and laterally.  

Bear Creek announces positive drill results in first four holes at Corani silver-gold project
Tuesday July 12

–About 6 properties in Peru 

 * OTMN.PK (O.T. MINING) (I own shares)
http://www.otmining.com/
info@otmining.com Jim Hess Tel: 514-935-2445
12.5 mil shares fully diluted  (July 19, 2004)
@ $3.80/share
$48 mil MC
Montana
The O.T. Mining Corp. Diamond Drilling Intersects Porphyry Copper Mineralization; New Claims Staked and Additional Patented Claims Acquired

Excerpt: The mineralized zone occurs between 665 feet and 1916 feet below surface (which is the current bottom of the hole), for a mineralized intercept of approximately 1251 feet. Alteration intensity, chalcopyrite concentrations, and the width of quartz/sulfide veins and replacements increase with depth. The hole remained in copper mineralization and associated alteration to its final depth of 1916 feet, when it was halted due to restrictions on winter drilling required by the U.S. Forest Service. O.T. intends to re-enter and continue the hole as soon as possible in 2005 to determine the vertical extent of this mineralization.The O.T. technical team feels that these results are very significant geologically, and interprets the mineralized drill intersection to be representative of “porphyry copper-type” mineralization. Porphyry deposits commonly form large tonnage, bulk mineable zones containing copper, molybdenum and gold. The mineralization at nearby Butte, Montana (known as the “Richest Hill On Earth”) is one such porphyry copper deposit.

I caught up with Jim Hess at the PDAC in Toronto in March 2005, and I wrote a report on O.T. Mining, sent to my email list. Click here:
http://www.silverstockreport.com/cgi-bin/dada/mail.cgi/archive/ssr/20050312031603/

Molybdenum has run up nearly 1000% recently, up to nearly $40/pound.  See:
The Molybdenum Discussion Board

Historic silver production for the Butte district, from 1880 to 2000 was 714,643,005 oz. silver.
They think their deposit may be bigger than “the richest hill on earth”, which is located near their property, in the Butte district.  
The exploration potential for this company is astounding, if they are right.

“The Ruby property encompasses the past-producing high-grade Ruby gold-silver deposit which produced an average of 2.44 ounces per ton gold and 38.66 ounces silver per ton.  A 193 ton bulk sample of a high-grade base metal mineralized zone associated with the Ruby deposit returned 7.6% lead, 5.19% zinc and 1.31% copper per ton.”

“…This deposit is situated adjacent to the Ruby property and according to old reports contained 0.88-34.28 ounces per ton gold, 35-527 ounces per ton silver, 1.96-11.84% lead, and up to 5% copper.”

It’s ‘Our Turn’ For Silver
by Greg Kyle June 16, 2004

Here is a comparatively busy message board for O.T. Mining:
http://ragingbull.lycos.com/mboard/boards.cgi?board=OTCF:OTMN

A nearly abandoned message board for O.T. Mining:
http://www.siliconinvestor.com/stocktalk/subject.gsp?subjectid=21081

I own shares of OTMN.PK

MCAJF.PK (MACMIN LTD)
http://www.macmin.com.au/
macmin@technet2000.com.au
482 mil shares and options (June, 05) see “corporate / share structure”
@ $.10/share 
$48 mil MC
This stock seems extremely volatile in price, with low liquidity, ranging from 7 cents to 13 cents.
Total resource: 56 million oz. –from 2004 annual report.
Will soon become a producer.
The company is debt free, but has an “equity line of credit of $10 million” so that they can issue shares for money to a certain group.  This may explain the wild changes in share price.  The potential investors want a lower share price for any new financings!  
Also, Macmin has several multi-million oz. potential projects.
PP: Jan 19th, 2005, 1.6 mil shares at $.126.

News article in Australia on MCJAF

MAI.V MNEAF.OB (MINERA ANDES)
http://minandes.com/
ircanada@minandes.com (604) 689-7017 Art Johnson
122 mil shares fully diluted (June 17, 2005)  (via email)
@ $.46/share Cdn x .82 US/Cdn = $.38 US
$46 mil MC
Has working capital of $1.5 mil Cdn as of Feb., 2005
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:  16.7 mil oz “silver equiv”
15 mil oz. silver + 1.7 mil oz. “silver equiv” of 170,000 oz. of gold.
They will be exploring for more: (The resources may be only 10% of the property.)
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.

Additional comments: (28.5 mil shares in March 23 2005 PP at $.55) PP comes free trading in July 23?

June 2005: stockpileing ore at the Huevos Verdes high-grade gold/silver project in southern Argentina

Minera Andes has several significant bonuses that my method is not valuing properly.  First, I undercount the gold, of course, so consider there is a “gold bonus” at current gold prices.  Second, they have been doing significant exploration work to increase their resources, and they have recently raised the money to be able to pay for that exploration work.  Third, they have a copper project, and copper prices are rising.  I moved MAI.V to the explorers list to be more fair to their valutation.  

* EDR.V EDRGF.PK (ENDEAVOUR SILVER) (I own shares)
http://www.edrsilver.com/s/Home.asp
invest@edrgold.com Hugh Clarke, Investor Relations 1-877-685-9775
28.6 mil shares fully diluted (March 23, 2005)
@ $1.60/share Cdn x .82 US/Cdn = $1.31
$37.5 mil MC
As of May 28th, 2004, they have $9 mil Cdn cash.
If all options and warrants are exercised, they will have another $9.8 mil Cdn in cash.
They believe there may be a chance they will not need to dilute further to develop current silver production plans at the Santa Cruz Mine.  
Endeavour Silver Corp.: Silver Resources Triple to More Than 12 Million Ounces at Santa Cruz Mine, Durango, Mexico
Wednesday March 30
They have 51% title to a working mine!  
http://www.edrgold.com/s/SantaCruzMine.asp
–currently producing 600,000 oz. silver/yr.
–May increase ownership from 51% to 100% by 2008 for $7 million.
–plans to increase production to 4,000,000 oz. silver/yr with a cash cost of under $3.00/oz.
–projects silver production …at its Santa Cruz mine and Guanacevi plant in Durango, Mexico, to triple in the twelve month period starting March 1, 2005 to 1.3 million oz.

Additional comments
PP: Dec 23, 2004, 1 mil units at $1.60 + 1 full warrant at $2.10.
Silver & Endeavour Silver – Hommel — 11 March 2005

Another article on Endeavour Silver

I own shares of EDR.V

TVI.TO TVIPF.PK (TVI PACIFIC)
http://www.tvipacific.com
tvi-info@tvipacific.com
Dianne (IR) Phone: (403) 265-4356
425 mil shares fully diluted (March 31, 2005)
@ $.095/share Cdn x .82 US/Cdn = $.08 US
$33 mil MC
Cash in hand: $600,000 March, 2005
“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.

Additional comments:  TVI is producing gold, and earning nearly $1,000,000 per month, gross.  Their costs are about $200/oz.?  TVI expects to double production by June.

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

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

ECU.V ECUXF.PK (ECU SILVER MINI)  
http://www.ecu.ca/ 
Michel Roy, President 011-52-871-727-1061 or 819-797-1210 ecu@ecu.qc.ca
= “145 mil shares fully diluted-about” verbal, from IR dept. (Sept. 9th, 2004)—including “about 5 mil shares in Sept 21 financing.”
@ $.24/share Cdn x .82 US/Cdn = $.20
$28 mil MC
ECU.V is also exploring other gold properties.

ECU Silver announced the closing of a private placement resulting in gross proceeds of $7,000,000 received in four (4) installments by ECU Silver.

Pursuant to this private placement, ECU Silver issued an aggregate of 24,137,931 units at a price of $0.29 per unit, each unit being comprised of one (1) common share in the share capital of ECU Silver and one third (1/3) of a common share purchase warrant, with each whole common share purchase warrant entitling its holder to acquire one common share at a price of $0.35

ECU is now a producer:  Producing about $100,000 of ore per week in May, 2005. –223 tonnes/day, $76/tonne ore.  Costs to produce that ore were not yet specified in recent news releases.

Bill Murphy and I are in a contest of the speakers for Cambridge House.  Bill’s stock pick as of June 10th was ECU at $.26/share Cdn.  My stock pick was Capstone gold at $.72/share Cdn.  The contest is to see which stock outperforms by the Toronto show this fall, Oct 2-3. see goldshow.ca for info on the show.  Interestingly, I’m the silver bug, and I pick Capstone “Gold”, and Bill, the gold bull from GATA picks ECU “Silver” Mini!  Interestingly, both companies had market caps around $30 million.  ECU: $30.5 mil US, CSG.TO: $34 mil US.

SPM.V SMNPF.PK (SCORPIO MINING)
http://www.scorpiomining.com
http://www.scorpiomining.com/s/SendMessage.asp
53.6 mil shares fully diluted March 31, 2005
@ $.60/share Cdn x .82 US/Cdn = $.49 US
$26 mil MC
Cash on hand: $8.5 mil Cdn. March 31, 2005
Scorpio’s recent March 2004, $16 million financing was at $2.25 Cdn/share!
— The Nuestra Senora Project: (the Candelaria deposit): Total Measured & Indicated: 131,058 tonnes @ 520.94 g/t Ag = 2.1 mil oz. of high grade silver, 16 oz./ton. Inferred: 49,468 tonnes @ 658.98 g/t Ag (21 oz./ton) = 1 mil oz. silver
–the Cochrane Hill Gold Deposit: The total Indicated Resource ~ 112,460 contained ounces of gold.
Total: 4 mil oz. silver equiv. 
The company is working on a 43-101 resource calculation from the recent drilling program, May, 2005.

Additional comments:  Very High Grade, narrow intersections… One intersection, was about 33 feet of 32 oz./tonne silver.

* MMGG.OB (METALLINE MINE) (I own shares)
http://www.metalin.com/site_map.html
metalin@attglobal.net Merlin Bingham 208-665-2002 
21.9 mil shares fully diluted (March 19th, 2005) 
@ $1.10/share US
$24 mil MC
$5 million cash on hand, July 31, 2004

Additional Comments:  
Silver, Zinc, & Metalline Mining — Hommel March 19th, 2005
–one correction for the article.  The word “reserves” should be “resources”.

–4039.6 million pounds of zinc.
@ $ .59/lb, that’s $2.4 billion dollars worth of zinc, and who knows how much silver.

They found exactly what they were looking for, 4 billion pounds of zinc, and they are drilling for more.  Their latest quarterly also includes a statement of the historical production, right below: 

Zinc & Silver in Mexico: Sierra Mojada.  Sierra Mojada is a Silver District!
“The Sierra Mojada Property has produced in excess of 10 million tons of high-grade ore that graded in excess of 30% lead, 20% zinc, 1% copper and 1 kg (31 ounces) silver per ton that was shipped directly to the smelter. The district has never had a mill to concentrate ore. All of the mining was done selectively for ore of sufficient grade to direct ship; mill grade ore was left unmined.”
(That’s 310 million ounces of silver.  Who knows how much silver is left?)  That’s the question with an explorer.

–Potentially the lowest production cost in the entire zinc industry, ($.25/lb., not $.35/lb industry standard) due to new “oxide deposit” chemical extraction process as revolutionary as “heap leaching”.  The team that did the feasiblity study for the only other existing oxide zinc deposit in production is now working on MMGG’s feasibility study.

If MMGG can produce zinc at $.25/lb., and receive $.60/lb, that’s $.35/lb difference.  That, x 4 billion pounds zinc is $1400 million dollars.  Compare that to the market cap!  Looks like there will be plenty of profit even after the costs of building a multi million dollar mine.

For more, see the 11-page “Research Works” article here: 
http://www.stocksontheweb.com/mmgg.pdf

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

I own shares of MMGG.OB

EXN.V EXLLF.PK (EXCELLON RSCS)
http://www.excellonresources.com
info@excellonresources.com
150 mil shares fully diluted (April 2005)
@ $.195/share Cdn x .82 US/Cdn = $.16 US
$24 mil MC
From http://www.smartstox.com/reports/excellon.html
indicated = 63,400 t x 2738 g/t x .03215oz./g = 5.6 mil oz. silver
inferred = 2100 t x 1,433 g/t x .03215oz./g = .1 mil oz. silver
BONANZA GRADE SILVER, LEAD & ZINC.
Apex is the joint-venture partner. 

Additional comments: NOW PRODUCING SILVER. The geologist, Peter K.M Megaw, is also working with MAG.V.  

Excellon completed a 9000 unit financing for $9.9 million. A “silver debenture”.  The holders of each unit can opt to receive cash or silver bullion based on 200 oz. of silver per U.S. $1100.  Thus, Excellon has “hedged” and pre-sold 1.8 million ounces of silver (OUT OF ALMOST 6 MILLION OZ.) at $5.5/oz.  Each unit also comes with 1000 warrants for Excellon stock at $.325.

Excellon hopes to be able to pay back this “silver debt” within perhaps 200 days from June 2005, and they believe they have much more exploration potential.

MAG.V MSLRF.PK (MAG SILVER)
http://www.magsilver.com
info@magsilver.com
29.8 mil shares fully diluted (June 9, 2005)
@ $.77/share Cdn x .82 US/Cdn = US $.63
$19 mil MC
Additional comments:  –“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.”

MAG Silver Announces Industrias Penoles Elects to Exercise Share Subscription
Tuesday May 3
The exploration Joint Venture covers MAG’s wholly-owned 8,302 hectare Juanicipio Property in Zacatecas, Mexico and Penoles can earn a 56% interest in the property by expending US$5,000,000 over a four year period.

My comments: This deal, to sell 56% at $5.5 million, values 100% of the Juanicipio Property at $9.8 million, U.S.  

“MAG continues to hold a 100% interest in the surrounding Lagartos NW and SE properties that make MAG the largest landholder in the Zacatecas Silver district.”

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. 

* KRE.V KREKF.PK (KENRICH ESKAY) (I own shares)
http://www.kenrich-eskay.com/
info@kenrich-eskay.com
Toll-free 1-888-805-3940 or (604) 682-0557
29.2 mil shares fully diluted (July, 2004)
@ $.80/share Cdn x .82 US/Cdn = $.66 US
$19 mil MC
Recently completed a $2.3 million financing for exploration.
Kenrich Eskay’s “Cory” property (25,000 acres, 100% owned) is 10km south of Barrick’s silver property, Eskay Creek, which is “the fifth largest silver producer in the world”, with a reserve “at the beginning of 2001, 1.42 mil tons, grading 1.5 ounces/ton of gold, and 68.3 ounces/tonne of silver, 3.2% lead, 5.2% zinc.–That’s Barrick’s Eskay Creek property.  Kenrich Eskay is hoping to find something similar nearby. (See 5th slide of http://www.kenrich-eskay.com/images/KRE-Presentation_files/frame.htm
70% of the rights to The Property was once almost bought by Homestake (which was acquired by Barrick) for $35 million in 1996, and Homestake was going to fund all exploration and development.  The buy out ended when metals prices collapsed, and Bre-X hit, and when the majors cut back on exploration budgets to stay alive.   This means the market cap of KRE.V may be worth 100% / 70% x $35 million, or $50 million, plus exploration and development costs, to a major mining company, and likely worth much more today, due to inflation of the dollar, and the rise in the price of silver!
The 2005 Geologist’s report 15 page executive summary recommends $4.5 million worth of exploration for 2005.  The one-sentence summary of the report is that “The Corey Property is highly prospective for the discovery of a second Eskay Creek-style deposit.”  I spoke with the key geologist in person in Vancouver in January for over an hour.  It seems to me that they know what they are doing and have a very good chance of finding something.  
I own shares of KRE.V 

* CBE.V CBEFF.PK (CABO MINING)(I own shares)
http://www.cabo.ca/
jav@cabo.ca (604) 681-8899 John Versfelt, President
36.5 mil shares fully diluted (Feb., 2005)@ $.50/share Cdn x .82 US/Cdn =  $.41
$15 mil MC

Additional Comments:Now Canada’s 3rd largest drilling company.  Cabo now owns over 100 rigs, and employs 225 people.  The cost to acquire this latest drilling company was $3 million Cdn, and included 1.8 million shares at $.90/share!

Recently, at the mining shows, I’ve heard it’s getting hard to find drillers.  That’s very understandable given how much cash all the companies have raised to go out and drill.  There are many bottlenecks standing in the way of increased production.  Limited competent geologists, engineers, builders, mining equipment, exploration teams, and drill rigs.  Cabo is now in a very good position.

Drilling Services are in extremely high demand, and Cabo can charge up to 25% more this year than last year.

Cabo’s drilling acquisitions are profitable, and providing cash flow.

See interview:  http://beechinorbarton.com/audio/cabo/player.html

I wrote an article on Cabo on February 10th, 2004.  Market Perspective & Cabo Mining – Hommel

In the article, I highlight what I feel is Cabo’s most imporant asset:  Their property in Cobalt, Ontario.  The “silver capital of Canada” produced historically, over 500 million ounces of silver. 

To learn more about the mining camp town of Cobalt, there is a fascinating article detailing the history of the silver camp at http://www.cobalt.ca/cobalt/history.htm

I own shares of CBE.V 

EGD.V EGDMF.PK (ENERGOLD MINING)
http://www.energold.com/s/Default.asp
info@energold.com  Fred Davidson President (604) 681-9501 
18.4 mil shares fully diluted  (May 3, 2004)
@ $1.01/share Cdn x .82 US/Cdn = $.83
$15 mil MC
Cash on hand: $7.2 million
Earned $.01/share, 1 Q, 2005, 11th consecutive quarter of earnings.
“advanced silver project in Mexico”  Real de Belem — property has “all the permits required for the commencement of a 200 tonne per day mining operation.” A range of 571 to 3,713 g/t Ag. (may not conform to Canadian NI43-101 standards.) A 16 hole, 1500 m drill program is currently underway.  At any time during the currency of the Option Agreement, Energold will have the right to acquire a 100% interest in the Real de Belem project for an additional US$5.0 million.
See Impact Minerals, of which Energold owns a controlling interest.

SDR.V SDURF.PK (STROUD RSCS)
http://www.stroudresourcesltd.com/projects-santo.html
gcoburn@stroudresourcesltd.com Mr. George E. Coburn, President Tel: 416-362-4126
99 mil shares fully diluted (Oct, 2004)
@ $.245/share Cdn x .82 US/Cdn = $.20
$20 mil MC
JV partner with APM.V on Santo Domingo Silver Project in Mexico.
10oz. silver/ton x 22,000 tonnes. minimum…
150 to 300 mil oz. exploration potential of the deposit.
ownership is between 30-50%, so… 30% of 150 mil oz.= 45 mil oz., and 50% of 300 mil oz. = 150 mil oz.
$20 mil MC / 45 mil oz. = 
$20 mil MC /150 mil oz. = 

APM.V (Amerix Precious Metals Corp)
http://www.amerixcorp.com/
john.andrews@amerixcorp.com
50 mil shares fully diluted 
http://www.newbulletgroup.com/financial.htm
@ $.40/share Cdn x .82 US/Cdn = $.324 US
$16 mil MC
APM.V has a gold deposit in Brazil that’s bigger than the silver project in Mexico.  
Article on Amerix: It’s not just a job, it’s an adventure by Bob Moriarty June 16, 2005
http://www.amerixcorp.com/mexico.htm
” If the deposit extends to considerable depth, as do many of the silver deposits in the region, it is reasonable to assume a deposit of 300 million ounces of silver.” 
Stroud Resources, JV partner, lists the deposit at 150-300 million oz.

APM.V partners with SDR.V
APM.V to get a 50-70% interest. 
50% x  150 mil oz.= 75 mil oz., 70% x  300 mil oz. = 210 mil oz.
$16 mil MC / 75 mil oz. = 
$16 mil MC / 210 mil oz. = 

EPZ.V ESPZF.PK (ESPERANZA SILVR)
http://www.esperanzasilver.com/s/Home.asp
info@esperanzasilver.com
37.5 mil shares fully diluted (June 2005)
@ $.315/share Cdn x .82 US/Cdn = US $.26
$10 mil MC 
“Currently, Esperanza is exploring and acquiring new bulk-tonnage silver prospects in both Peru and Mexico. We are extremely excited about our projects in both countries. Neither has experienced significant silver exploration recently and so much untapped potential remains. Company exploration is now active on our Flor de Loto and Estrella Projects, Peru and La Esperanza in Mexico. We have also identified and are in the process of acquiring new properties to add to our exciting portfolio.”
PP: Dec 1, $1.5 mil Cdn at $.40/unit with 1/2 warrant at $.55.

QTA.V QURAF.PK (QUATERRA RES)
http://www.quaterraresources.com/
corpdev@mnxltd.com
Jay Oness (of Western Silver) Toll Free: 1-888-456-1112
60.6 mil shares fully diluted (June, 2005)
@ $.34/share Cdn x .82 US/Cdn = $.28 US
$17 mil MC

Additional Comments:  three main properties in North America.
The main exploration project is the Nieves, near the massive Fresnillo silver mine, owned by Penoles ($2 billion market cap).

Quaterra Resources Inc: Drilling Resumed at Nieves Silver Property
Wednesday December 1
5000 meter program to follow up on: (129.3 ounces/tonne) over 1.5 metres
” The company said the results demonstrate that the Nieves mineralized system continues to have potential for development of Fresnillo-style underground high grade veins, and for bulk tonnage silver mineralization.”

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

SML.V SMLZF.PK (STEALTH MNRLS)
http://www.stealthminerals.com
Bill@McWilliam.com 604-306-0391 Bill McWilliam, Chief Executive Officer
103.4 mil shares fully diluted (March, 2005)
@ $.155/share Cdn x .82 US/Cdn = $.13
$13 mil MC
PP: Dec, 2004; $4 million finaning: 3 mil shares at $.45 and 5 mil shares at $.50 flow thru.
SRY.V (STINGRAY RSCS)
http://www.stingrayresources.com/
info@stingrayresources.com (416) 368 6240
17.1 mil shares fully diluted (May 28, 2004)
@ $.68/share Cdn x .82 US/Cdn = $.56
$10 mil MC– Current projects centered in the Sierra Madre Belt of Mexico 

NJMC.OB (NEW JERSEY MIN)
http://www.newjerseymining.com/
minesystems@usamedia.tv
Fred or Grant Brackebusch 
23.6 mil shares fully diluted May 2, 2005
@ $.44/share US
$10 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.
7 Silver properties & 2 gold properties.

March 31, 2005 Management thinks that the Silver Strand is an excellent exploration property with potential for a deposit containing up to 100 million ounces of silver equivalent.

PXI.V  PNXPF.PK (Planet Exploration Inc.)
http://www.planetexploration.info/mexico.asp
invest@planetexploration.info
30.8 mil shares fully diluted (Jan. 2004)
@ $.34/share Cdn x .82 US/Cdn = $.28
$9 mil MC
Planet holds an option to acquire a 100% interest in the high-grade 7,005-hectare Copalquin gold/silver property located in Durango, Mexico.
“Resource estimates on the property have not been calculated since the discovery of the high-grade vertical fault zone, its existence may significantly alter Kennecott’s and Fransisco Gold’s original target potential of one million ounces of gold and 50 million ounces of silver based on their interpretation of a low-grade horizontal quartz breccia formation.”

KG.V KDKGF.PK (KLONDIKE GOLD)
http://www.klondikegoldcorp.com/
investorrelations@klondikegoldcorp.com
As of Feb 12, 2005, an 8.2 Mil. pp is being processed and will close soon. This would make 84,228,910 shares outstanding and a 
fully diluted amount of 117,643,910 shares. 
@ $.09/share Cdn x .82 US/Cdn = $.07 US
$9 mil MC
PP:  Jan 17, 2005: 6 mil units at $.12 with a full warrant at $.14.
This company has many silver and gold properties.  Klondike has one silver property that could be producing within weeks.

MMG.V MMEEF.PK (MCMILLAN GOLD)
http://www.macmillangold.com/
macmillangold@ca.inter.net
35.7 mil shares fully diluted (2 Q, 2005)
@ $.295/share Cdn x .82 US/Cdn = $.24
$9 mil MC

GPR.V GPRLF.PK (GREAT PANTHER RES)
http://www.greatpanther.com
info@greatpanther.com Robert Archer, President, & Kaare Foy CFO: 604 608 1766 (Reg Avocat, IR)
22.8 mil shares fully diluted (June, 2005) 
@ $.50/share Cdn x .82 US/Cdn = $.41
$9 mil MC
“Great Panther Resources Limited has combined experienced management, access to capital and high quality projects in Mexico. Silver and gold prices gained 26% and 21% respectively in 2003 and GPR intends to leverage this through the acquisition and development of high quality silver and gold projects.”
–Option on the Topia Silver Mine in Mexico, formerly owned by Penoles, closed in 1999.  Est. 5 years worth of resources left. needs payments totaling about $2.5 million over 3 years.  Plan to increase production to 200 tonnes/day with $1 million refurbish cost.  May have up to $5 million/year gross cash flow.  Value of the metals is from about 50% silver, 50% lead & zinc.

APE.V (Apogee Minerals Ltd.)
http://www.apogeeminerals.com
John Carlesso, President and C.E.O.  jcarlesso@apogeeminerals.com (416) 861-0341 
24.4 mil shares fully diluted (Feb 2005)
@ $.34/share Cdn x .82 US/Cdn = $.28
$7 mil MC
–has 4 advanced silver/zinc/lead exploration properties in Bolivia
Potosi, in Bolivia, is the most productive silver mine in history, with 2 billion oz. of silver produced from 1545 to 1825.  That’s perhaps 1/20th of all silver production since the beginning of time.  Apex Silver is also in Bolivia.

Additional comments:  
New Drilling at Apogee’s Santa Isabel Property Returns 15m of 253 grams per tonnes Silver, 13% Zinc, 230 grams per tonnes Indium

SSV.V (SOUTHERN SILVER EXPLORATION)
Jay Oness Phone: (604) 684-9384 corpdev@mnxltd.com
21.9 mill shares fully diluted (Jan 2005)
@ $.34/share Cdn x .82 US/Cdn = $.28
$6 mil MC
Silver/Lead/Zinc in Mexico
See also Quaterra and Western Silver.  Same guys with these 3 silver companies.
* CMA.V CRMXF.OB (Cream Minerals Ltd) (I own shares.)
http://www.creamminerals.com/cream/main.htm
http://www.langmining.com/cream-mx/
info@creamminerals.com 1 604 687 4622
= 37.9 mil shares fully diluted (April, 2005)
@ $.18/share Cdn x .82 US/Cdn = $.15 US
$6 mil MC
from: http://www.langmining.com/cream-mx/companyProjects_Summary.html
Project B:  Potential Target: 400m x 500m x 150m x 2.5 t/m3 = 75,000,000 tonnes
Say at: Au 0.480 g/t Ag 149.33 g/t
Silver only, that’s (1 gram = .03215 troy oz.) 4.8 oz./t x 75 million tonnes = 360 million oz. “exploration potential” in a low-grade deposit.
$6 mil MC / 360 mil oz. = $.02/oz. (exploration potential) –not yet even a “resource”! 

Additional comments: 2 mil unit PP in April, 2005, at $.35
Another silver property is the Kaslo.
“The Kaslo Silver Property encompasses the Keen Creek Silver Belt and is comprised of nine former high grade silver mines”…

(I own shares of CMA.V) 

TM.V TUMIF.OB (TUMI RESOURCES) (TUY Frankfurt Exchange)  
http://www.tumiresources.com
nicolaas@attglobal.net Nick Nicolaas IR (604) 657 4058
24 mil shares fully diluted (Mar. 1, 2004)
@ $.30/share Cdn x .82 US/Cdn = $.25 US
$6 mil MC
Cinco Minas: (not really feasible) 43-101 compliant update: 14.3 mil oz. silver, 100,000 oz. gold indicated and inferred, 
Tumi owns 60% interest in Cinco Minas .6 x 15 = 9 mil oz.
But there is further exploration potential at Cinco Minas.  The 43-101 report only considers 120 meters of 790 meters, and it’s open at depth.
Debt free, 2 projects in Mexico.
Raised $2.7 million Nov. 14, 2003
Tumi Acquired new silver/gold exploration projects in Mexico.
http://www.tumiresources.com/en/Releases/tumiprJan1905.pdf
Exploration Potential: 24 (likely plus more after bonanza silver discovery late November, 2003.)

* PDO.V (PORTAL RESOURCES LTD) (I own shares)
http://www.portalresources.net
info@portalresources.net  Phone: (604) 629-1929 Reg Advocaat 
11.7 mil shares fully diluted (Feb 2005)
5 mil shares owned by management!
@ $.65 Cdn x .82 US/Cdn = US $.53
$6 mil MC
In Argentina, in Chubut Province, Arroyo Verde Gold/silver Project.  Option to own 100%, need about another $1 mil or less to exercise option.  Property was explored a bit, and now, will be re-explored.  Planning to do a 3000-meter reverse-circulation drill program, to go deeper, looking for the “boiling point”, hopefully a wider higher grade area..  –Possible open pit, no historic workings, 200km to the east of IMA’s properties.  The property was formerly owned by Minera Andes recently, and Pegasus, who ran out of time and money at the bottom of the market in 1999.  
In Argentina, in Mendoza, San Rafael project (Gold and copper in Argentina) 700 sq. mile prop., 30 drill targets…

Portal Resources Ltd.: More High Grade Assays at Arroyo Verde
(I own shares of PDO.V)

GNG.V GGTHF.PK (GOLDEN GOLIATH)
http://www.goldengoliath.com/
jps@goldengoliath.com
604-682-2950
42.2 mil shares fully diluted
@ $.15/share Cdn x .82 US/Cdn = $.12
$5 mil MC 
Additional comments:  Silver Explorer in Mexico in the the Sierra Madre mountains: Uruachic.
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.

IPT.V IMPJF.PK (Impact Minerals)
http://www.impactminerals.com/s/Home.asp
Frederick W. Davidson, President (604) 681-9501 inquiries@impactmin.com
19.3 mil shares fully diluted (1 Q, 2005)
@ $.34/share Cdn x .82 US/Cdn = $.28 US
$5 mil MC
IMPACT is exploring the extensive Zacualpan Silver Mining District in central Mexico. IMPACT signed agreements that include options on two operating mines and a processing plant.
Example /sample:  3 meters of 1463g/t Silver.–June 17th, 2004 news release

GRG.V (GOLDEN ARROW RESC) (I own shares)
http://www.goldenarrowresources.com/s/Home.asp
shareholder@tsx.com
Sean Hurd (800) 901 0058 (604) 687-1828 (same # as for IMR.V, which spun off Golden Arrow)
11.5 mil shares fully diluted (Feb, 2005)
$750,000 Cdn in the bank.
@ $.53/share Cdn x .82 US/Cdn = $.43
$5  mil MC
35 exploration properties
Argentine & Peru Property portfolio
–Spun off from IMR.V (IMA Exploration)  
–$2 million financing in Nov. 2004 at $.63 with warrants at .80
I own shares of GRG.V

PCM.V PAOCF.PK (PAC COMOX RES)
http://www.pacificcomox.com/
info@pacificcomox.com
75 mil shares fully diluted Oct., 2004 
@ $.045/share Cdn x .82 US/Cdn = $.04
$3 mil MC

MTB.V (Mountain Boy Minerals Ltd)
http://www.mountainboyminerals.ca/
cavok@uniserve.com
TEL: (250) 636-9283
17 mil shares fully diluted  (July 2004)
@ $.24/share Cdn x .82 US/Cdn = $.20
$3 mil MC
http://www.stockhouse.ca/news/news.asp?newsid=1933880
high grade samples:  3640 g/T Ag to 45.5 g/T Ag

LSM.V LASCF.PK (Langis Silver & Cobalt Mining Co Ltd)
no web site: Patrick Sheridan Jr. President and Secretary-Treasurer Phone: (416) 628-5936
11.6 mil issued and outstanding common shares. (not fully diluted)
@ $.33/share Cdn x .82 US/Cdn = $.27
$3 mil MC

TBLC.PK (TIMBERLINE RES) 
http://www.timberline-resources.com
Company contact: Bill Hoyt, director. 785-383-9246 bill@hoytstation.com
6 million shares outstanding.
@ $.42/share
$2.5 mil MC
The Company has acquired seven mineral prospects to explore. These prospects are located in Nevada, Idaho and Montana.
Timberline to Lease Montana Properties to Sterling Mining Thu, Aug 26 – Business Wire
The Montana property is near the property owned by Mines Management.  
Silver Property: Minton Pass project: 20 claims containing Revett formation silver/copper project in Northern Montana.  At least 5 drill holes were drilled on or near the claim group in the 1970s and 1980s.  A 1971 geologic report indicates that mineralized outcrops of Revett quartzite containing bornite and other copper minerals could be traced for about 1 mile along strike of the outcrop.A short adit was driven to expose the mineralization.Sampling results showed a stratographic thickness of 16.7 feet that averaged .7% copper and 1.78 opt silver.
Detailed work plans are under development, pending acquisition and study of prior exploration data.
–Feb, 2005, finalized and signed an agreement with Hecla to earn 49% of their Snowstorm Project/Mine:
The Snowstorm Mine– a small but highly profitable operation from the early-1900s that produced 800,000 tons of ore averaging 4-percent copper and 6 ounces per ton silver.

* AUN.V AUNFF.PK (Aurcana Corp) (I own shares)
http://www.aurcana.com/
kbooth@aurcana.com  CEO Ken Booth 604-331-9333
42.7 mil shares fully diluted (Sept 2004)
@ $.06/share Cdn x .82 US/Cdn = $.05 US
$2.3 mil MC
Cash $650,000 Cdn, no debt
Drilling to commence on high-grade, gold-silver targets. (in Mexico)
6 properties.
Real de Catorce–Historically, more than 220 million ounces of silver was mined from five 
million tons of ore on this district, approx. 48 ounces of silver per ton

(I own shares of AUN.V)

LEG.V LEGCF.PK (LATEEGRA RSCS)
http://www.lateegra.com
info@lateegra.com
Michael Townsend, President Toll Free: 1-866-669-9377 Richard one of the IR guys.
38.7 mil shares fully diluted? (Jan 7, 2004)
@ $.065/share Cdn x .82 US/Cdn = $.05 US
$2 mil MC
see also Minvita (I own shares of Minvita, MVE.V)
–involved with 7 exploration projects, one near the Eskay Creek Silver Mine, one in China.

CLZ.V (Canasil Resources Inc )
http://www.canasil.com/
22.4 mil shares fully diluted (July 2004)
@ $.08/share Cdn x .82 US/Cdn = $.06
$1.5 mil MC
Exploration properties in Mexico and B.C.

ASLM.PK (AMER SILVER MINI)
2.75 million shares issued
@ $.51/share
$1.4 mil MC
Claim between CDE and the old Sunshine mine.
JV with CDE subsidiary untill 2017.  ASLM to receive 20% net royalty, & if silver prices reach $16.50 an ounce or above, the profit sharing goes to 40%.  
Coeur d’ Alene, Idaho

* MVE.V (MINVITA ENTERPRISES) (I own shares)
http://www.minvita.com/
604-682-3680  Fax: 604-682-3992 dino.teuton@shawlink.ca
13.8 mil fully diluted shares Feb, 2005
@ $.11/share Cdn x .82 US/Cdn = $.09
$1.2 mil MC

(I own shares of MVE.V)
——————————————————————
——————————————————————
Final Category: Silver stocks FOR YOU and I TO RESEARCH further:

These are companies that may have good exposure to silver, but that I cannot determine the market cap, because I cannot find the number of issued and outstanding, or more importantly, fully diluted shares.

Silver Phoenix Resources, Inc. not yet public)
Bill Murray bmurray@sunwave.net 250 832 0336
Bill is selling “seed shares” to help take “Silver Phoenix” public.
The plan is to start from scratch, and build up to 150 investors to go public, rather than use a “shell” company.  
Bill has up to 6 silver properties, one of which has an hisoric resource (not 43-101 compliant) of 10 million oz. of silver.  In Canada. Silver Phoenix plans to buy Bill’s properties for 1 million shares, up to about 10 million shares over time, plus $750,000 (only if the properties move to full production), plus Bill retains a variable 3% NSR.  I estimate that buying seed shares at $.25 Cdn to $.40 Cdn, means that the silver in the ground costs the investor in Silver Phoenix (at $.40/share) from $.10 to $.50/oz., or less if there is more than 10 million oz. of silver on Bill’s properties.
Bill runs http://minersmanual.com/
Check out the Silver Forum at http://www.minersmanual.com/bulletinboard.php

GZD.V (GRIZZLY DIAMONDS LTD )
http://www.grizzlydiamonds.com/
Brian Testo
Phone: (780) 693-2365

BGS.V BLDGF.PK (BALLAD GLD SLVR)
http://www.balladnet.com
ir@balladnet.com
@ $.275/share Cdn x .82 US/Cdn = $.22 US
Bonanza grade “grab samples” in southern Argentina near IMA.  
32 oz./T gold and 22 oz./T silver grab samples.  

FORTUNA VENTURES INC (FVI.V)
currently about 9 mil shares outstanding
management owns 70%
financing needed:
$10 mil at $1 with warrant at $1.25
property in peru 21 mil oz. silver
Exploration potential: 40 mil oz.

Silver Syndicate Mining Corp (SDMC.PK)
Minco Silver (not yet public)
160 mil oz. deposit in China
888 288 8288
bill meyers
michael legg

Sino Silver Corp (SSLV.OB) (I’ve heard this company is overvalued with nearly a $100 million market cap, and a property acquired for $1 million) and then, trading was recently halted.
Info@SinoSilver.com
http://www.sinosilvercorp.com/
1-888-471-SINO or 604-699-8622 info@SinoSilver.com

Lixus Gold: —www.lixusgold.com  A geological report conducted for Cobre Valley Mineral Recovery Co. in 2000 investigated these two properties as well as an adjacent holding. The report concluded through surface and underground assays and measurements that probable reserves on the two properties under acquisition are from 3 million to greater than 10 million tons grading 6 to 12 opt/AG.

UNCNE.OB (UNICO INC)
http://www.uncn.net/
Ray Brown, 530-873-4394
Andrew Beyer (909) 587-8072
@ $.029/share 
You get options and leases … and an unknown debt and share structure…

——————
Rivet silver  
Doug Warte & Frank Duval 509 921 2294

http://www.celticresources.com/

Grand Central Silver Mines Inc (GSLM.PK)
Malachite Resources MAR.AX
http://www.malachite.com.au/

Mascot Silver Lead Mines MSLM.PK
http://www.mascotsilver.com/
Coeur d’ Alene, Idaho
“Though we have reserves and could conceivably mine them, it frankly makes no sense to do so at current prices. … The end of the silver bear will bring a number of the now-dormant small companies back to life…”
New President, still trades under $.25/share.

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

Merger Mines Corp (MERG.PK)  –Leased by Sterling Mining, who is exploring their property, and owns 14% of  Merger stock.
2.7 mil shares outstanding.  (Sept, 2004)
Coeur d’ Alene, Idaho

Signal Silver –hopes to trade by next year.

Mineral Mountain Mining Company
Delaine Gruber, 208-664-3544
www.minmountain.com
Coeur d’ Alene, Idaho

Independence Lead
Coeur d’ Alene, Idaho

Metropolitain Mines Ltd (MEMLA.PK) –next to the Sunshine in Coeur d’ Alene, Idaho

Silver Bowl 
http://www.silver-bowl.com/
Coeur d’ Alene, Idaho
–working to get a new stock transfer coompany

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

Silver Mountain Lead Mines Inc (SMLM.PK)

Silver Verde May Mining Co (SIVE.PK)

Silver Surprize Inc (SLSR.PK)

Standard Silver Corp (SDSI.PK)

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

Andean American Mining Corp AAG.V ANMCF.PK
http://www.andeanamerican.com/
–concentrates solely in Peru
Peru currently stands as the largest gold producer and second largest copper producer in Latin America as well as the second largest silver producer in the world.

Here are a few more stocks to look up.  I don’t even know if some of these are silver miners.

Lfex – Lucky Friday Extention  
Kcpm – King of pine creek
Vins – vindicator silver,  

Osburn
Wallace
APNE
ALS
Royal Silver Mines (RSMI)
Bunker Hill– owned by new bunker hill mining company, stockpiling ore.
Nabob
New Era

For more info on more silver stocks, see the new book, “The Silver Pennies” by David Bond.

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 lemetropolecafe.com and silver-investor.com (I subscribe to both). Some of these stocks can move up 15%, 30%, 50% or even over 100% in a single day. Thus, valuations can change very, very quickly. So, be careful, and re-check the numbers if the prices move up. Do your own math.

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

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

:
http://www.bibleprophesy.org/SilverStockExtra.html

Blanketpower’s Mining Links for Investors
http://www.blanketpower.com/mining/titlepage.htm

http://silverminers.org/ —info on the Silver Valley, Idaho
http://www.silverstrategies.com/  –silver news site
http://www.silverseek.com/  –silver news site
http://silverminers.com/  –silver news site
http://www.silver-investor.com  –silver news site
http://www.gold-eagle.com/silver_section.html
http://www.gold-eagle.com/silver_section/reports.html

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

Many 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.  

The beauty of the internet is that it is helping knowledge to increase, and it is a form of communication that those who commit crimes of monetary fraud upon us cannot control.  Please make the most of it, and please forward this on to others. 

You can signup to receive this report by sending an email to:
subscribe@silverstockreport.com

Jason Hommel

Final Disclaimer:  I have not received any compensation from any public silver stock company for writing up my weekly report on “Silver Stocks–Comparative Valuations”.  I own shares of the following 19 silver stocks, in no particular order: ABI.V, MVE.V, SRLM.PK, CFTN.PK, IMR.V, CSG.TO, GRG.V, ASM.V, CMA.V, PDO.V,AUN.V, EDR.V, MGN, CBE.V, SVL.V, MMGG.OB, OTMN.PK, KRE.V, CZN.TO.  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.  I believe the SEC does not require a disclosure regarding finder’s fees.  Nevertheless, I receive “finder’s fees” from silver companies on occasion