Allocation: 6
(Allocation raised from 4 to 6 on 06-12-07, price $US .96)
Initiating Price: $US 1.35
12-18 Month Price Target: $US 2.35
U.S. Silver Corp. owns the Galena mine complex located in the heart of the Coeur D’Alene mining district one of the preeminent silver, lead and zinc producing areas in the world. This mine complex is the second most prolific silver mine in US history with over 200 million ounces of silver produced to date. Since 1953 this mining complex has produced 210 million ounces of silver, 159 million pounds of copper and 22 million pounds of lead from 9.9 million tons of silver-copper ore at average grades 21.26 ounces of silver, and 0.80% copper. When mining lead-silver ore, the grade averaged 8 ounces of silver and 8.8% lead per ton of ore. Currently the Galena mine is operating at approximately 500 tons per day of silver-copper ore. The current plan will see the Galena mine increase to over 700 tons per day by Q3 2007. The intention is to ultimately get production from the Galena mine up to 1100 tons per day as that is the capacity at the Galena mill. This level of production is forecast to be achieved sometime in 2008 after the Galena shaft has been rehabilitated. Repair work on the Galena shaft has started but in the meantime the #3 shaft will be our only hoist for the silver-copper ore.
US Silver's property covers 11,000 acres over an area approximately 11 miles long East to West and 3 miles wide. The assets include three mines four operating shafts, two operating flotation mills as well as extensive surface and underground mining equipment. The operating Galena mine is located near the center of the property with the Coeur Mine on care and maintenance about 1.5 miles west of the Galena Mine. The Caladay Exploration Shaft is located approximately 2 miles to the east of the Galena Mine.
The company will also initiate lead-silver mining later this year with the intention of hoisting this ore through the Coeur Shaft and processing the material at approximately 400 tons per day at the Coeur Mill. The company has recently signed a new off-take contract with TeckCominco to smelt the lead-silver concentrate starting in September of 2007.
DISCLAIMER STATEMENT
The information contained in this report has been written by David Lavigne of EdgeWater Research Partners LLC ("Edgewater") and has been derived from sources considered reliable, but cannot be guaranteed by us. Edgewater and Lavigne are not aware of any material conflict of interest known at the time of the publication of this report. Financial projections and estimates herein represent our independent analysis based upon information in conjunction with the Company's publicly available financial statements. Edgewater and Lavigne may maintain positions in the securities referenced, which may change at any time without notice. Edgewater does not receive fees, warrants or any other compensation from issuers in connection with its research. It does however, encourage issuers and it representatives to subscribe to Edgewater's research, and from time to time, issuers and or their representatives may also purchase individual copies of Edgewater's research products. Edgewater and Lavigne may own options, rights or warrants to purchase any of the securities of the Company. This report is for informational purposes only and is not to be construed as specific investment advice or recommendations, nor as an offer to sell or a solicitation of an offer to buy any securities. The securities referenced are speculative in nature and may not be suitable for your specific investment objective. For specific investment advice or recommendations, please consult with your investment representative.
As of this date, employees, Directors and or founders of USA have subscribed to 2 full annual subscriptions for Edgewater’s newsletter and research information. In addition, USA has purchased 0 research reports from Edgewater. In March 2007, USA paid a fee of $10,000 to attend EdgeWater’s “Spring 2007 Micro/Small Cap Conference for Investment Professionals”.
