Levon Resources Ltd (New) V.LVN

New update at www.goldsilverdata.com

[Newager23]

Levon Resources has a huge potential mine in Mexico. The Cordero project has 450 million oz of silver (20 gpt), 6 billion lbs of zinc, and 3 billion lbs of lead, and they are still drilling aggressively. They released a PEA in March 2012, with a mine plan to produce 40,000 tpd for the initial phase. That equates to 7-8 million oz of silver production (84% recovery rate at 20 gpt). Long term, production could triple to 120,000 tpd, which is 20 million oz annually. 

The problem with this project is that it requires $30 silver to be economic. Thus, no one is going to buy it until silver prices reach perhaps $50. This is a long life mine with a very large capex. No one is going to invest $1 billion on a mine with poor economics. We haven’t seen the final feasibility study yet, so we don't know the break-even point. But my guess is the break-even point will be around $22 to $25 per oz when this mine is finally built. 

If Levon is looking for an offer anytime soon, they are going to be selling for a very cheap price, perhaps a low as .10 cents an oz (450 million oz x .10 = $45 million). Are they ready to give away this project for $45 million, plus a small NSR royalty percentage? I hope not. They have $46 million in cash and can continue drilling. I hope they wait for $50 silver before making a deal.