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

To: ahhaha who wrote (254)	10/21/1999 1:23:00 PM
From: Claude Cormier	Respond to of 4409

<<As for BAY with flat silver prices BAY goes sideways.>> What kind of per share cash flow will BAY have in year 1 and how long will it take to pay back financing? To say what you just said, you must certainly have an idea on Alamo Dorado economics. Can you also explain why BAY went from $0.50 to current level ? Why Argentina Gold went from $0.50 to $7.00 last spring ? Why Agnico is up 100% in less than a year ? Why Eldorado is up 200% in less than a year? They all showed up major increase in reserves with flat metal prices. And there are a lot more examples like that. << Others on this thread seem to think BAY will persist upward since they will be finding more and more silver. The problem is that finding more and more means cost diseconomies of scale. >> If Alamo Dorado has more silver that allow it to go into production at 3,000,000 tons/year instead of 2,000,000... the costs will go down. It will never hurt costs to have more resources. <<The small miner incurs unscaled costs at an unwieldy rate since they aren't outfitted to cope with scale. Trying to rapidly grow is a little like trying to bite off more than can be chewed. Also, it takes bigger and outside infusions of capital in order to achieve the new scale.>> I agree with that. Much easier for a senior who has more access to capital. That is why I like BAY very much. The situation is exceptional as the CAPEX will be extremely low.