Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Corner Bay Silver (BAY.T) -- Ignore unavailable to you. Want to Upgrade?

To: Syncrude who wrote (166)	9/28/1999 8:55:00 PM
From: Brunello	Respond to of 4409

If I am not mistaken, BAY is having more drill tests done. Results should be forth coming. The results could prove that the find is better than originally thought. If this is the case, what do you think the value of the shares could be? I believe original projections were from $3.50 - 6.00.

To: Syncrude who wrote (166)	9/29/1999 12:04:00 AM
From: Claude Cormier	Read Replies (2) \| Respond to of 4409

1) Since the DB report... BAY announced a set of holes drilled on 50-meters centers instead of 100m. All the results improved the lenght of the intercepts without lowering the grades: -the 10 drill holes at spaced at 100m intercepted an avberage 105 meters of 93g/t silver-eq -the 8 drill holes drill in the middle of each section (50m spaced) intersected an average 185 meters of 88 f/t gold. The continuity, width and grades of the deposit are now confirmed... even if the resource cannot be classified into proven...it is a very solid one. Other risks are the traditional risks... environmental, permit, financing...etc.. But given the fact that this deposit is in Sonora State, a place where it is easy and common to bring up a mine.. there should be no problem. Another risk which is not yet confirmed...is the final recovery rates... will it be 67% average or closer to 80-85%. This will affect profitability. The the deposit appears to still be very profitable at 50% recoveries. In short, until the mine is up and running...there are always risks... even after <g> 2) No backstop with their other properties... Alamado Dorado is THE asset of BAY. Valuation is done in the same manner as gold. You must start with an estimate of production costs... they figure near $3.75-$4.25 per ton at a rate of 2.4M to 3.0M tons per year. With the high grade starter pit this means production costs of $1.25-$1.50 per ounce. Then you had a bit of admin...something like $0.25 or so... You can calculate a gross profit possibly in the range of $3.50-$4.00 at current price... with a production of 4-5M ounces tou may get some $14M-$20M gross profit per year... Substract taxes of 25% I think...amd we are in the ballpark of $10-$15M net per year for 12 years. Discount this at 5-7% and you get a NAV in the neighboorhood of $US50M-$70M... with the current number of shares out..we are talking $6-$$10 per share. Another way to look at this is to say that mining silver at $1.25-$1.50 per ounce is like mining gold at $75/ounce... How much do you think a gold deposit approaching 2M ounces of gold equivalent mineable at a cost of $75/ounces is worth ? For sure before we reach those prices we will need more data.. This data is coming.. - next week: the remaining drill holes of the summer program - end of october - scoping/pre-feasibility study - end of the year results of metallurgical test Add to this the possibility of a new discovery on the south zone... We should have fun over the next 2-3 months if results continue to be as good as they have been so far. Claude