Thoughts on USA potential numbers or and pie in the sky:
About 250 million shares FD so we have a stretch but it can happen. Some things to think about.all numbers very rough.:
<While the repair of this shaft is important to the long-term optimum operation of the Galena mine, the company is confident that the target of 1,000 tons per day can be achieved without the Galena shaft repair being completed.>
1000 tons per day is the start.
<The average grade of the silver-copper ore was 22.9 ounces per ton silver and 0.83% copper.1 Average grade of the silver-lead ore was 8.2 ounces silver and 8.8% lead per ton of ore.2.>
1.Galena mine 2.couer mine.
< Ore grades are expected to continue to improve in both mills throughout the year with grades returning to historical averages later this year. >
<The intention is to ultimately get production from the Galena mine up to 1100 tons per day as that is the capacity at the Galena mill. >
1100 tons per day of 22 ounce/ton silver is 7 million plus ounces per year production. 6 million lbs of copper. The copper represents 18 mill in credits to offset silver mining costs of 10 bucks per ounce current.From the Galena mine.
<The company decided in early 2007 to reactivate the Coeur Mill to process lead-silver ore from the Galena Mine. To achieve this, the company reconditioned the 3400 level haulage way from the Galena Mine to the Coeur shaft, a distance of about 1.5 miles. The reconditioning involved laying new heavier gauge track as well installing an improved ventilation system. The shaft and mill were also reconditioned with the mill being commissioned in early September 2007 at a start-up rate of 200 T/day. The mill will be running a full capacity of 400 T/day in the 1st Q 2008.>
400 tons per day of 8 ounce silver with 8% lead is another 1 million ounces of silver. 8% lead is 11,000 tons of lead. That is about 30 million dollars in lead credits to offset silver costs. Couer mine.
<TORONTO, ONTARIO - July 10, 2007 - U.S. Silver Corporation (TSX VENTURE:USA), is pleased to announce the acquisition of the historic Dayrock Lead-Silver Mine and Mill facility located about 3 1/2 miles northeast of the Company's Galena Mining Complex in the Silver Valley of North Idaho.>
<U.S. Silver's intention is to explore for new undiscovered vein systems as well as extensions of the four known high grade oreshoots that were historically mined at the Dayrock mine. The mill, although idle for many years, has a historic capacity of 450 tons per day. Low metals prices, inefficient mining activities, and property issues resulted in the mine being idled in the 1970's. Head grades from the Dayrock Mine during the last full year of operation were 11.9 ounces of silver and 12.0% lead per ton of ore mined. While the mill appears to be in good condition due to the high level of care and maintenance activities during the past 30 years, repairs and upgrades will be required to put the mill back into operation. >
Using figures from the Coeur as an example the Day mine could produce another 1 million ounces of silver with another 30 million dollars in lead credits.
<The Caladay Shaft lies approximately 7,300 feet southeast of the Galena Mine No.3 Shaft and the two mines are interconnected on the 4900 foot level of the Galena.
In the early 1980's a joint venture of Day Mines, Callahan Mining, and ASARCO spent approximately $32.5 million (about $80.0 million in 2006 dollars) on the Caladay property to construct surface facilities, a 5,101foot deep shaft and associated underground workings to explore the property. The hoist is currently fully operational.
The historical underground exploration program undertaken in the late 1980's included 94 drill holes. >
They did not spend 80 mill in today's dollars on an empty hole in the ground.
Drill Hole From (feet) To (feet) Width (feet) opt Ag Pb %
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49-50 452.0 520.0 68.0 8.30 13.47>>>
Rumor has it there is a huge area of 30 to 100 foot widths of high grade rock. That hole above illustrates $500.00 ton rock.
So not even counting the future of the Caladay but adding the potential production from the Galena, the Coeur and the Day mines of about 1950 tons per day ore milled and producing roughly 9 million ounces of silver with costs of 10 bucks per ounce but with lead and copper credits totalling 70 million to 80 million we get production of 9 million ounces of silver for about 2 bucks per ounce cost.
Using 15 dollar silver that gives us 13 bucks profit times 9 million ounces or about 117 million in cash flow or about 46 cents per share. At a 15 multiple that gives us a share price of 6.90. About a 10 bagger. Just use your imagination.
That is a rosy picture so I figure production at half that but the price for silver and the credits for lead and copper can remain fairly stable. So 23 cents cash flow per share times a conservative 13 multiple gives us 2.99 or 3 bucks. I think we see 4 bucks a share in a year or two if they can prove up 100 million ounces.
I am banking that my back of the envelope numbers are close enough to help me retire. Do your own DD all in fun for entertainment opinion only. |
