Re: Silver, Zinc & Metalline Mining --MMGG-- -- siempre lo mejor

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Date Posted: 08:33:09 03/20/05 Sun
Author: paul rembac
Subject: Re: Silver, Zinc & Metalline Mining --MMGG--
In reply to: siempre 's message, "Silver, Zinc & Metalline Mining --MMGG--" on 02:52:18 03/20/05 Sun

>Silver, Zinc, & Metalline Mining
>
>By Duncan Hsia & Jason Hommel
>
>Currently, silver is 300 times cheaper than historic
>norms lasting for 1000's of
>years, when the silver in a dime was worth about a
>day's wage. The reason that
>silver is cheap today is that no nation on earth is
>using silver as money.
>Monetary demand started to end in the late 1800's, and
>finally ended in the late
>1960's. In the last 60 years, the trend has been to
>consume, in industry &
>electronics, nearly all the silver ever mined since
>the beginning of time.
>Investors are beginning to become aware of the silver
>shortage, and thus, in
>2002, Hecla mining (silver) was the top performing
>stock on the NYSE. In 2003,
>silver stocks, on average, were up 314%. Today, silver
>bullion itself is up
>from $4.15/oz. in the spring of 2003 to about
>$7.30/oz. Silver prices peaked
>recently at $8.40/oz. in April 2004, and the trend is
>still up. Silver may
>reach about $15-25/oz. in the next year. I believe
>silver prices will exceed
>historic norms of about $2000/oz., due to the shortage,
>and the renewed awareness that silver is most useful
>as money, because it is
>not fraudulent like broken paper promises.
>
>Most silver is produced as a by-product of gold,
>copper, lead and zinc mining.
>Zinc prices are also rising.
>
>Zinc is an industrial metal used primarily for
>galvanized steel (47%), brass
>(19%), and zinc alloys (16%). It is used mostly for
>construction, the
>automobile industry, and machinery.
>
>World zinc consumption has increased from a historic
>2% average annual growth
>rate since the 1960's to over 3% in the 1990's to over
>4% currently. The main
>increase in zinc consumption has been in developing
>countries in Asia (mainly
>China) with large decreases in Central and Eastern
>Europe. China is now the
>largest consumer of zinc in the world, increasing at
>8-10% per year; although it
>increased an impressive 22% during first nine months
>of 2003 and 26.5% in the
>first 11 months of 2004 (Macquarie Bank, Dec 2004).
>
>Zinc metal exports from China have declined
>significantly in recent years,
>transforming China into a significant net importer of
>zinc. As China, India,
>and other countries continue to develop and modernize,
>the demand for zinc will
>continue to grow swiftly while supply shortfalls push
>prices higher.
>
>If substantial new mine development doesn't occur
>soon, a large supply gap will
>occur. Unlike other commodities, there are few giant
>zinc deposits in inventory
>to fill the gap due to depletion of reserves during
>the past several years of
>low zinc prices. Development of two very large mines
>resulted in an oversupply
>of zinc in 2001 and 2002; however this completed the
>development of the giant
>deposits. The supply deficit now coincides with a
>period of no new mine
>production in the pipeline until late 2006.
>
>CRU International forecasts that 2.5 million tons of
>new annual zinc mine
>production is required by 2007 to meet expected
>demand. Given that there are
>few new zinc projects committed to production, this
>new production requirement
>is unlikely to be met.
>
>Filling the gap is made more difficult as much higher
>zinc prices are required
>to finance development of known deposits and there is
>a need to discover new
>quality zinc deposits to meet growth projections.
>
>The LME zinc inventory is approximately 585,000 tons,
>well down from its peak of
>790,000 tons in April 2004. As the supply shortfall
>continues, inventories are
>expected to decline to low levels, causing price
>increases. Here's a current
>snapshot of zinc prices and LME zinc inventory over
>the last 5 years:
>http://www.kitcometals.com/charts/ZINC_historical.html
>
>As the demand has grown and worldwide zinc inventories
>have been drawn down,
>zinc in 2005 has broken out to a new 5-year high above
>$.60/lb. The increasing
>zinc price combined with the upcoming supply gap has
>created an incredible
>opportunity for any significant zinc mines ready for
>production in the next few
>years.
>
>Metalline Mining--Ready to Seize the Zinc / Silver
>Opportunity
>
>Metalline Mining (MMGG - Bulletin Board), led by a
>management team of seasoned
>geologists, is ready to seize on the incredible
>opportunity in the zinc and
>silver markets. With the share price currently at
>$1.81/share and 19,928,181
>shares outstanding, its market cap is $36 million.
>With 21,924,735 shares fully
>diluted, the market cap is $39.7 million.
>
>Metalline Mining currently owns one 17,446-acre mining
>property in Mexico known
>as the Sierra Mojada Property. The Property is located
>within a historical
>mining district that has produced in excess of 10
>million tons of very
>high-grade lead-zinc-silver ore. The Sierra Mojada
>Property has produced in
>excess of 10 million tons of high-grade ore that
>graded in excess of 30% lead,
>20% zinc, 1% copper and 1 kg (31 ounces) silver per
>ton that was shipped
>directly to the smelter. The district has never had a
>mill to concentrate ore.
>All of the mining was done selectively for ore of
>sufficient grade to direct
>ship; mill grade ore was left unmined." (That's 310
>million ounces of silver
>from historic production. Who knows how much silver is
>left?)
>
>The district has high voltage electric power and is
>easily accessible via paved
>road, an airstrip, and rail lines. The government in
>Mexico also would like to
>bring in work and jobs to the relatively depressed
>economy, and has a very
>hospitable attitude towards mining, especially in
>comparison to the United
>States.
>
>In 1999, the huge potential of the oxide zinc
>mineralization of the Iron Oxide
>Manto and Smithsonite Manto was recognized as a result
>of a positive feasibility
>study conducted for Anglo American Corporation's
>Skorpion mine, located in
>Namibia, Africa.
>
>That Skorpion mine, in Africa, is the first and only
>mine in the world using the
>solvent extraction electrowinning process for
>extracting Super High Grade zinc
>(SHG zinc is 99.995% zinc) from oxide zinc ore.
>Solvent extraction
>electrowinning is a hydrometallurgical process that
>has about a 30% lower cost
>for extracting zinc than the pyrometallurgical process
>used at smelters by most
>other mining operations around the world. This process
>costs about 25
>cents/pound instead of 35 cents/pound.
>
>Seeing the Skorpion mine success, Metalline shifted
>its focus to zinc. Through
>extensive drilling and block model evaluations,
>Metalline worked to define its
>zinc reserve, which they've now shown to have 2.23
>million tons (nearly 5
>billion pounds) of contained zinc (worth over $3
>billion at current zinc
>prices). Metalline is now more than 3 months into
>their feasibility study
>stage, which is about a 1-year process where the
>logistics are planned for
>building the mine, getting all the regulatory
>approvals, defining all the costs,
>and analyzing the profitability of the project. Once
>the feasibility phase is
>done, Metalline may become a very attractive buyout
>target, as large mining
>companies look to acquire more metals supply.
>Metalline plans to use the
>feasibility study to get debt financing to build the
>mine, which will take about
>2 years.
>
>To conduct the feasibility study, Metalline selected
>Green Team International
>(GTI), the same company that conducted the feasibility
>study on the Skorpion
>mine. GTI designed, supervised the construction, and
>operated the Skorpion mine
>and extraction plant through initial production and
>until the mine and plant
>were at 90% capacity. Given Metalline's plan to use
>the same efficient,
>cost-saving process as Skorpion, GTI was the perfect
>choice.
>
>The GTI team has already toured the property above and
>below ground, reviewed
>the data, and selected surface locations for the mine
>and extraction plant
>facilities. Metalline's plan to help fill the
>worldwide zinc supply gap in the
>coming years with potentially one of the world's
>largest zinc mines with the
>lowest production cost in the industry is getting
>closer to reality.
>
>If, like Skorpion, Metalline can produce zinc at 25
>cents/pound, that's over 37
>cents/pound margin at the current zinc price (which,
>because of the zinc supply
>gap, will probably go much higher by the time
>Metalline's mine goes into
>production in 2-3 years). With 2.23 million tons of
>contained zinc, or nearly 5
>billion pounds, that equates to over $1.8 billion of
>gross profit. If you take
>out the approximately $250 million cost of going into
>production, you still have
>over $1.5 billion. No matter how you discount back for
>the time it will take to
>get the cash flow from the zinc production, Metalline
>Mining's current market
>cap under $40 million looks miniscule.
>
>MMGG initiated a private placement at $1/share about a
>year and a half ago to
>raise capital for the reserve definition and
>feasibility study. Recently, the
>stock price has declined as some of the investors in
>that private placement have
>sold shares to lock in significant profits of 50% to
>200%. Despite the
>fundamentals improving dramatically over the last 6
>months, with zinc prices
>moving up about 25% along with successful completion
>of the reserve definition
>phase, the stock price has dropped significantly from
>the high of $3.28/share in
>October because of this selling. The selling from the
>prior private placement
>has created the opportunity of Metalline's low share
>price, and helps to explain
>why the shares remain cheap. Metalline's zinc reserve
>alone is worth about 80
>times its current market cap. Company insiders,
>recognizing the value, have
>bought between $1 and $1.66 over the last 2 years, as
>zinc has moved from under
>35 cents/pound in 2003 to over 62 cents/pound n
>ow and Metalline has successfully moved closer and
>closer to production.
>
>On Friday afternoon, March 18th, Metalline issued a
>project update news release.
>Until this update, Metalline had been very quiet about
>their success thus far,
>choosing to keep a low profile and not promote their
>stock. However, they will
>now start an active stock promotion program in
>addition to their plans to get
>listed on the American Stock Exchange. An increased
>price and market cap will
>improve their application for listing. They are
>planning a road show to promote
>the stock all over the world to the appropriate
>audiences (including natural
>resource funds).
>
>Silver highlights: Silver grades as high as 341 ounces
>per tonne! Over 5000
>samples of the polymetallic mineralization north of
>the Sierra Mojada Fault have
>been collected from the Polymetallic Manto by the
>Company through 1999. These
>samples contained an average of 300 grams silver per
>metric ton (10 ounces
>silver per metric ton), 0.6% copper, 5.5% zinc and
>2.2% lead. Within this
>mineralization silver grades range from kilograms (31
>ounces per kilogram) to as
>high as 11 kilograms / tonne over a thickness of 9
>meters (3.28 feet per meter)
>and copper grades are as high as 4%. This indicates
>that the Polymetallic Manto
>contains very high grade silver and copper
>mineralization.
>
>Quick comparison with a more well-known zinc silver
>explorer:
>Apex Silver: 7.8 billion pounds of 1.6% zinc, 454
>million oz. very low grade
>silver.
>Metalline Mining: 5 billion pounds of 8-13% zinc, 300
>million oz. (historic)
>very high grade silver.
>
>Apex Silver: $560 million estimated needed to build
>the mine.
>Metalline Mining: $250 million estimated needed to
>build the mine.
>
>Apex Silver: Over $500 million cash on hand.
>Metalline Mining: About $1.5 million cash on hand.
>
>Apex Silver: Market Cap: $872 million
>Metalline Mining: Market Cap: $40 million (at
>$1.80/share)
>
>For more information about Metalline Mining, visit the
>company's web site at
>http://www.metalin.com. You can also call Merlin
>Bingham, CEO of Metalline
>Mining, at 208-665-2002 or metalin@adelphia.net.
>
>I, Duncan Hsia, along with everyone in my immediate
>family and household, own
>shares in Metalline Mining from last year's private
>placement (and haven't sold
>any despite the expiration of the lockup period), and
>have bought more recently
>on the open market between 1.50 and 1.70. I have not
>been paid by the company,
>nor do I or any family or household members work for
>the company.
>
>I, Jason Hommel, sponsored the writing of this essay
>by offering to give a 100
>oz. bar of silver to whomever sent me the best essay
>on Silver & Metalline
>Mining. I own shares of Metalline that I purchased in
>last year's private
>placement, and have not sold any yet, either. I have
>not purchased any
>Metalline shares in the open market recently.
>Metalline has not paid me for
>this article, and I don't work for Metalline, nor does
>any of my family. I
>produce a silver stock report, on occasion, which you
>can signup to receive for
>free at silverstockreport.com

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Re: Silver, Zinc & Metalline Mining --MMGG-- -- paul rembac, 16:04:12 12/28/07 Fri