GREY:MLKKF - Post by User
Post by
NobodyKnowsOneon Apr 19, 2011 6:24pm
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Post# 18456718
RE: Losing on Silver Hedge
RE: Losing on Silver Hedge Hindsight is 20/20, BOTnugget. In 2008 they needed the money to build the mine, and they probably were thinking that they should sacrifice the least important metal at the time.
From the Consolidated Interim Financial Report in 2009:
Effective June 23, 2008, the Company closed the previously announced agreement with an affiliate of Silver
Wheaton Corp. (“Silver Wheaton”) for the sale of the life-of-mine silver production from Mercator's Mineral
Park copper/molybdenum mine in Arizona. Under the agreement, Silver Wheaton’s affiliate has made an upfront
payment of $42 million in cash to Mercator Barbados. Upon delivery of the silver, Silver Wheaton will
then also pay Mercator Barbados in cash the lesser of the silver spot price or $3.90 per ounce of silver
(escalated by 1% per annum starting in the fourth year of silver production).
52,000 ozs. silver X $3.90 = $202,800 March silver sales
Aggravating, I'm sure, because Silver Wheaton is making a great deal more.
Cheers