• Gold: 1,625.21 5.62
  • Silver: 14.39 -0.00
  • Euro: 1.114 0.001
  • USDX: 98.306 -1.153
  • Oil: 21.95 -1.25

Silver Seeker Report: This Week in Mining Issue #5

Endeavour Silver: Things are going from bad to worse for the higher-cost silver producer. In 2019, the company announced its El Cubo mine (which was its most profitable operation for a couple years) had become depletes of mineral reserves and it would be winding down operations until the company could drill out additional resources. This lowered output and caused an increase in companywide all-in sustaining costs (AISC). Further, due to heavy selling in silver and the company’s all-in cost structure being well above spot prices, should this continue for a prolonged period of time, it will be a cash drain. Beyond that, this week, the company completed the updated pre-feasibility study (PFS) at its Terronera silver project. Based on the preliminary economic assessment (PEA) and initial PFS, in addition to encouraging drill results after the study was completed, Terronera was to be its cornerstone asset, and by a substantial margin. Instead of publishing a summary of the PFS, Endeavour is now reviewing the study internally as it is less robust relative to the previous PFS. This could be resolved and be every bit at economic as originally thought but this in nonetheless unsettling news for the time being. | $AUY $PAAS $SILV $SVM $NEE.V $NGD $MUX $KL $GUY.TO $GCM.TO $EXK $ELY.V $GOLD $ALO $AGI

Silver Seeker Report: This Week in Mining Issue #4

$USA $EDV.to $EQX.to $FSM $FNV $WPM $KGC $MAX.to $OSK.to $PVG $NVO.V | America’s Gold and Silver Corp: Reported FY 2019 production of 5.8m AgEq oz, though only 1.2m oz. of that was actual silver ounces, the rest being base metals converted to silver equivalent. 2019 was a transition year for the company as it recapitalized and entered into a JV agreement with Eric Sprott for its Galena Complex. Having visited the site a couple times over the years, it is a solid smaller silver operation but optimization measures, a larger resource base and in turn production coupled with higher silver prices will make this a profitable operation in a couple of years. The real-story here is achieving commercial production at its Relief Canyon gold mine. When first acquired, this was going to be a profitable operation but with low margins, but now with gold $200-$250/oz. higher, it should have solid margins (assuming a long-term gold price deck between $1,450-$1,500/oz). In other words, it is looking like the worst days are behind it and over the next year and a half, should begin to generate a fair amount of cash flow.

Silver Seeker Report: This Week in Mining Issue #3

Aurcana: Increased the previously announced non-brokered private placement from $4m to $5.76m and completed the second tranche. This will go toward underground development (and in turn, reducing cap-ex) to bring its principle asset (Revenue-Virginius) into production and ideally, the remaining capital investment will be funded via debt or at least in large part. While it is difficult to generate positive operating cash flow in the current silver price environment, due to the higher grade nature of the deposit and in turn AISC/AgEq oz. is sub-$10.75/oz. (or $8/oz. Ag), due in part to a resource grade >1k g/t, this shouldn’t be an issue. The asset currently has a relatively small resource base of 21.2m oz. (2P), 29.9m (M&I inclusive of 2P), and an additional 13.2m oz. (Inferred). This asset, while small, will also derive the vast majority of revenue from precious metals: silver (71%) and gold (9%). $AUN.v $BCM.V $CALDAS $EQX $FSM $GOLD.TO $GORO $HIGH.V $MAG $MMX $SAND $SMF.TO $SILV $WM.TO

Silver Seeker Report: This Week in Mining Issue #2

Companies covered in this weekly review: $BTG $KOR.TO $EDV.TO $GCM.TO $MAG $SKE.V $AUY MAG Silver: Construction of the world class Juanicipio silver project continues to progress. The underground mine will commence production ahead of schedule in mid-2020. Over 25km of underground development has been completed to date. There are slight capital-cost over-runs relative to the January 2018 estimate, now estimated at $440m ($194m attributable to MAG). The ramp up will take some time on this large underground mine but this won’t really impact profitability as silver grades are highest in the earlier years. The project is now expected to reach 85% of nameplate capacity in Q4 2021 (up from 65% previously) and 90-95% in 2022. Commissioning of the flotation plant will start mid-2021.

Silver Seeker Report: This Week in Mining Issue #1

Alexco: is in the process of divesting its profitable and fast-growing remediation business (AEG) to the AEG management group. On closing of the transaction AEG will be pay Alexco $12.1m in cash, with the balance of $1.25m payable pursuant to a promissory note maturing on February 14th, 2021. This will go a long way to reducing the required capital investment to bring several Keno Hill mines back into production, feeding a central mill. Construction will start in 2020 and the because the company has already built the mill and started mine development, the buildout period is estimated at 8 or so months... Companies covered in this weekly report: $AXU $USAS $KOR.to $AG $FSM $KNT.v $GSV $KL $OR $SILV $PAAS $TXG.to $WGO.v

Mining Stocks Are Historically Cheap

While the micro-cap junior exploration stocks are by far the cheapest segment of the mining stock sector in terms of potential risk/reward, investor distaste and market inefficiency occasionally feeds prospecting mining stock investors an expected “golden nugget,” if you will. Fortuna Silver is a current example. Chris Marcus invited me onto his Arcadia Economics podcast to discuss why I put a strong buy on FSM in July when the rest of the market was dumping the shares:

Santa's Stockings Have Silver

Massive upside breakouts are taking place across the precious metals sector. Many mining stocks, especially silver-oriented, are skyrocketing. How is it possible that silver stocks are ripping to one fresh new high after another, leaving bullion behind? Well, there is commercial trader bullion shorting activity on the COMEX. Money managers are buying silver stocks, not COMEX contracts, and it doesn’t take much money flowing into these stocks to push them dramatically higher. A COMEX silver price surge is coming though, because there are two big inflationary forces at play. First, the easing of trade tensions is opening the door for global growth in the late stage of the business cycle. That’s incredibly inflationary. Wage growth and consumer spending growth in China (Consumer spending growth is above 20% in some major Chinese cities now) is going to push prices higher in both China and the West. This growth-oriented inflation can be called “good inflation”.

Fool's Silver: Why Most “Silver Miners” Don't Live Up to Their Name

If you buy shares in a silver mining company, you will have to assume additional market risks compared to ownership of silver bullion. You may wish to do so in order to potentially gain leveraged exposure to silver prices. What you may not realize, however, is that most of the publicly traded “silver” stocks out there are primarily in the business of mining other metals – sometimes gold, often copper, zinc, lead, and other base metals.

Silver Seeks to Catch Up With Gold

The best performing metal this week was silver, up 6.40 percent on perhaps a paradigm shift as the investors poured $133 million into silver bullion ETFs on Wednesday, the single biggest inflow in six and a half years. The weekly Bloomberg survey of gold traders and analysts shows that most are bullish on the yellow metal as prices broke through a five-year high and touched $1,453 per ounce on Friday morning. Traders seem to be set on an interest rate cut from the Federal Reserve this month, which is helping gold, even as some better-than-expected economic data was released on Tuesday. Turkey, which often sells its gold, saw its reserves rise by $71 million this week compared to last.

Santacruz Silver Files NI 43-101 Technical Report for the Gavilanes Project on SEDAR

Santacruz is a Mexican focused silver company with a producing project (Rosario); two advanced-stage projects (San Felipe and Gavilanes) and an early-stage exploration project (El Gachi). The Company is managed by a technical team of professionals with proven track records in developing, operating and discovering silver mines in Mexico. Our corporate objective is to become a mid-tier silver producer.

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