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Gold/Mining/Energy : Pan American Silver Corp (PAA-T) -- Ignore unavailable to you. Want to Upgrade?

To: The Vet who wrote (278)	7/15/1999 11:55:00 AM
From: Elizabeth Andrews	Respond to of 358

Are you saying that the board has approved a huge expenditure on a project and it doesn't matter if it's not profitable? Isn't this acting like a government and not a business? Who is the insurance company as I need to get a policy on a bridge just in case the client doesn't pay. By the way should read those annual reports again as it appears they are also losing money on the other silver properties as well.

To: The Vet who wrote (278)	7/16/1999 1:39:00 AM
From: paul ross	Read Replies (1) \| Respond to of 358

PAA may have more to lose than they have let on. They're on the line for $60 M until the project is completed, a lot can happen between now and then. From the 7/6 press release: >>>>Project Costs: (All amounts are expressed in U.S. dollars) Pan American has spent $18.2 million on the Dukat project, including acquisition costs. Future costs are estimated at $86.8 million, including working capital, contingency allowances, pre-production interest and financing fees. These costs will be financed by means of $60 million in project loans from a syndicate of international banks, and $26.8 million of equity investments by Pan American and International Finance Corporation (''IFC'') a member of the World Bank Group. IFC's equity investments will be $4.9 million for a 10 percent stake in the Russian company which holds the mining licence to the Dukat deposit, and $9 million for about a 5 percent stake in Pan American.Pan American's remaining equity investment will be $12.9 million. A $10 million cost overrun facility has also been arranged which will be funded by a $6 million standby loan and a $4 million deposit by Pan American which will be refunded if the project is on budget at start-up. IFC's loan and equity investments are subject to approval by its Board of Directors. Project Loan: The project loans will be provided b IFC and Export Development Corporation of Canada. IFC has syndicated part of its loan to several other banks. The average loan life is four years and the average interest rate is LIBOR plus 5.5 percent. Pan American will guarantee the loans until the mine meets certain financial and technical tests after production start-up, after which the loans will be non-recourse to Pan American. The loans are subject to documentation and a number of conditions, including Russian Central Bank approvals. First draw-down is expected in September.<<<<< Sold most of my shares as we just passed $6. My charts show silver should fall to the mid to low 4's late summer-early fall. PAA should then be available in the 4-4.50 US$ range.