Gold Newsletter
Lundin marvels at economics of Silvercorp's Ying
2005-07-27 16:26 ET - In the News
In the July, 2005, edition of the Gold Newsletter, Brien Lundin heaps more praise on Silvercorp Metals Inc.'s Ying project in China, marvelling at its potential economics. Mr. Lundin said buy Silvercorp, now trading at $2.25, four times, between June, 2003, and March, 2005, at prices ranging from 71 cents to $2.48. An investment of $1,000 each time would now be worth $7,670.25. Recent tunnelling at the S2 vein on Silvercorp's Ying silver-lead project included a 0.4-metre intersection of 8,566 g/t silver, 16.7 per cent lead and 19.86 per cent zinc. The company drew this intersection from S2E. This new vein is an offshoot of S2, 192 metres north from one of Ying's two main access tunnels. The company has already made out an indicated resource of 420,000 tonnes of 1,393 g/t silver, 33 per cent lead and 10 per cent zinc. Mr. Lundin says Silvercorp should build on its resource base quickly. Further, by the letter writer's count, the metal value of the ore should be $800 a tonne at today's prices. The company expects Ying to produce that ore for under $100 a tonne. With a planned milling operation processing 600 tonnes of ore a day, Mr. Lundin believes the company could kick off enough cash flow in one year to cover its current market cap. Mr. Lundin follows Rui Feng, once president of Pacific Mineral Inc., a past Lundin pick.