South American Silver

n/a
n/a
n/a

South American Silver Corp. Overview

South American Silver (TSX: SAC) is advancing the largest silver-indium resource in the current metal cycle. The Malku Khota project resource covers only 3.5 km of a 15 km prospective land position in Bolivia. The project at an early stage has robust economics. Higher grade mineralization to be processed early in the mine life is contained in the exposed ridgeline, suggesting a low strip ratio, aiding rapid repayment of capital. The resource is a silver-indium-gold low-sulfide deposit that appears amenable to a low-cost acid heap leach operation. Catalysts for price appreciation include:

• Increase and upgrade of identified resource
• Higher silver, indium and gold prices
• Expansion potential along trend

Malku Khota has good potential for having lower costs for development and operation relative to other projects. The potential to recover indium significantly reduces the cost of producing silver. We also are of the opinion that South American Silver has good potential, as with other mining companies, to develop and potentially operate a mine in Bolivia. We are initiating coverage of South American Silver with a price target of $2.00 per share, a Buy rating, and a High risk assessment.

South American Silver Corporation’s (TSX: SAC) Malku Khota Project in Bolivia may be the largest low-cost silver discovery in the current metal cycle. South American Silver’s concession extends over the most prospective 15 kilometers (km) of a 60 km mineralized trend. South American Silver has recently established an initial 144 million ounce Indicated silver resource and an additional 177 million ounces in the Inferred category.

South American Silver (TSX: SAC) announced a 2.8 billion pound copper Inferred resource estimate (at a 0.3% copper equivalent cutoff) grading 0.55% copper, 68.25 ppm molybdenum, 0.06 g/t gold, and 1.66 g/t silver at a 0.64% copper equivalent at its Escalones project in Chile.  At a 0.1% copper equivalent resource increased to over 4.5 billion pounds of copper.  The Escalones project includes 70 square kilometers and is in the same mining district as the El Teniente deposit, the world’s largest underground copper mine.

The resource estimate was based on 30 diamond drill holes totaling 12,666 meters and 43 channel and road cuts totaling more than 2,100 meters.  The company also completed a ZTEM and aeromagnetic survey potentially indicating areas of additional sulfide mineralization to be tested.  South American Silver plans to mobilize two drill rigs in a 7,000 meter drill program to begin in April of 2012.

Monday, December 19, 2011 - 20:00

South American Silver Corp. (TSX: SAC) is set to positively surprise investors by completing a compliant NI 43-101 resource estimate at its Escalones copper-gold-silver project in Chile, adding a second project to its world class Malku Khota silverindium-gallium project in Bolivia. Work completed in 2011 should lead to a new resource at Escalones that should clearly
broaden the company’s resource base. This is important because drill results and initial resource estimates that may significantly increase shareholder value are catalysts for increasing the rate of appreciation of company valuations up the value curve.

Thursday, December 8, 2011 - 11:35

 

A combination of events increased volatility of exploration and producing mining companies in Bolivia.  Labor unions appear increasingly unsatisfied with pay increases and are applying pressure on the government.  This contributed to comments by Bolivian leadership for revisiting lease agreements with mining companies and the Corporation of Mining of Bolivia (Comibol) dating back to the mid-1990’s.  Broad comments, combined with unsettled revisions to Bolivian Mining law scheduled for completion in the coming months, and investors concerns dating back to the government’s earlier handling of foreign interests in the oil and gas industry, kept investors on edge.

 

Through the week, certain companies received assurances through public statements by Bolivian authorities that they were not under review.  Minister of Mining and Metallurgy, Jose Pimentel, made a statement that the only companies under evaluation were those with “mines that belonged to the state in the past” and those formally requested by workers.  He excluded Sumitomo’s San Cristobal, which came after privatization.  In addition, Coeur d’Alene Mines (NYSE: CDE) reported that that they were assured, in meetings with the minister, that their San Bartolomé mine had the support of workers and “will not be nationalized.”  The evaluation process for revisiting the contracts is unclear, but uniformly, comments by officials make clear that the worker’s input is necessary, and that a decision may be made by May 1, 2011.

 

South American Silver (TSX: SAC) experienced above average volatility.  Its Malku Khota project was discovered in 2003 and acquired from private land owners.  Interestingly, comments that lease agreements with Comibol came out about the same time as statements by Pagina Siete, the Bolivian Vice Minister of Mining, supporting the importance of the Malku Khota project and the importance of foreign investment to one of his country’s most important industries.

Friday, April 15, 2011 - 16:36

South American Silver (TSX: SAC) is advancing the largest silver-indium resource in the current metal cycle. The Malku Khota project resource covers only 3.5 km of a 15 km prospective land position in Bolivia. The project at an early stage has robust economics. Higher grade mineralization to be processed early in the mine life is contained in the exposed ridgeline, suggesting a low strip ratio, aiding rapid repayment of capital.

Wednesday, October 28, 2009 - 10:44

South American Silver Corp. (TSX: SAC) received its first NI 43-101 compliant Preliminary Economic Assessment (PEA) study on its 100% owned silver-indium Malku Khota project in Bolivia. Because the study is the first un-optimized study and includes only about 3.5 km of the project’s 15 km strike length, we believe the project has significant upside.

Thursday, February 26, 2009 - 16:51