Casey, back on the buy
PGM Ventures
V.PPG, www.pgm-ventures.com
Price
Share: C$0.65
MCap: C$44,823,730
On: 9/30/05
Shares
SO: 68,959,586
FD: 97,713,742
As of: 6/30/05
Warrants
UnEx: 22,299,156
C$0.40-C$0.65
Exp: 9/5/05-6/3/07
Options
Open: 6,455,000
C$0.40-C$0.87
Exp: 7/16/06-2/23/10
Cash
C$7,396,948
Gain: C$1,709,537/mo*
As of: 6/30/05
*Sold properties and interests this year to focus on AT.
BUY— PGM continues making steady progress toward production at its 100% owned copper-zinc (and now silver and gold) Aguas Tenidas mine in mining-friendly Spain. The company has even secured financing to put their mine into production, pending the new bankable feasibility study (BFS) that should be announced any day now. In the latest developments, PGM reported on their 3,400-meter underground infill drill program. The 20-hole program was expanded to 24 holes because the mineralized zones appeared to be both thicker and wider than previous estimates. Assay results so far indicate higher contained metal grades than in previous estimates. Best results include:
16.1 meters at 4.3 g/t gold, 136.4 g/t silver, 2.94% copper, 2.33% lead and 6.57% zinc, including 5.5 meters at 4.5 g/t Au, 283.1 g/t Ag, 2.95% Cu, 6.59% Pb and 17.66% Zn.
38 meters grading 1.4 g/t gold, 68.3 g/t silver, 1.74% copper, 1.32% lead and 7.32% zinc, including 24.2 meters at 1.6 g/t Au, 83.9 g/t Ag, 2.58% Cu, 1.94% Pb, 9.35% Zn.
At today’s prices, that’s $566.60 rock for the 5.5-meter section… and $222.84 for the 38-meter intercept. Additional assay results are also expected any day now. The addition of significant gold and silver intercepts is very important. With a BFS out soon, these latest numbers are not likely to be included, so the company will probably have to recalculate the study almost as soon as it's done. But that's okay, as any study that shows that the mine is economic should unlock the loan that PGM has arranged, possibly getting the company into production by the end of next year with very little further shareholder dilution (that scenario was always one of the things we liked most about this play). If the actual results are better than called for by the study, so much the better. Drills are still turning, so more good assays, as well as the expected green light on production, should finally get this stock going. If you haven’t yet picked up your position, the current C$0.50-C$0.60 price range is an excellent entry point.