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

To: GraceZ who wrote (1703)	12/22/2000 2:21:32 PM
From: Claude Cormier	Read Replies (1) \| Respond to of 4409

Grace, Although the feasibility study is only starting, the current economic studies and proposed mining plan suggest that BAY would still be very much profitable at silver US$4. So to your question, I answer that silver price can drop another US$0.70 and BAY would still be in profits. At that price, production debt would be reimbursed in year 1 or so, and cash flows for the following 4 years would be near US$10 millions per year. My model is not perfect but I calculate a net aset value near C$3.75 based on 15M shares at silver US$4. At silver US$4.70, I get above C$6 as a NAV. BAY is extremely leverage to silver with break even level near US$3.00 for the first 5 years. But I doubt BAY would bring up the mine at prices below silver $4. The rate of return would go below 20% and they would probably prefer to wait for higher prices. Claude