Credit to freddymanl on the stockhouse board.
Just to reiterate what I posted on the 'next great silver junior' blog:
Seems the 9-10 million oz of 'pure silver' production quote is now spliced out of the SNN video and if we do our own calculations it is indeed 9-10 million oz Ag Eq production for 2012.
Considering that there may be only one or two mid-tier silver producers in all of North America in the ten million oz range per year that I am aware of and not one of them trades anywhere near as a penny stock there is likely to be a revaluation.
Courtesy of and thanks to Banman17:
By Christopher Barker | More Articles
February 6, 2012 | Comments (2)
When choosing among the miners of gold and silver, accurately pinpointing the industry's strongest looming production increases has yielded some of the sector's most memorable gains. Fools who took notice when I prepared them for Endeavour Silver's (NYSE: EXK ) monster growth spurt back in August 2010 could be sitting on a cozy 250% gain today. Fortuna Silver Mines (NYSE: FSM ) is well-positioned for a meaningful growth trajectory of its own, and I recently visited the miner's new San Jose mine in Oaxaca, Mexico, to bring my readers a first-hand look.
But not even those rapidly expanding producers will match the epic production growth that Aurcana (OTC: AUNFF) is targeting over the next 12-18 months, after the company's Shafter mine in Texas enters commercial production later this year. Of course, mining is a challenging and unpredictable business that can thwart even the best-laid plans. But if Aurcana executes a smooth rollout of its second mine, the company will launch its way straight into the realm of mid-tier producers, with output of about 6 million ounces in 2013! From 2011 production of 1.74 million ounces from its rapidly expanding operation at La Negra, such a leap would undoubtedly clinch Aurcana's position as the fastest-growing silver producer over the period. Accordingly, I have designated Aurcana as a top pick within my Motley Fool CAPS portfolio.
When placing hard-earned capital on the table to invest in such a sensational growth story, a Fool must have confidence in the people leading the way. After sitting down for a lengthy chat with Aurcana CEO Lenic Rodriguez in Vancouver last week during the Cambridge House World Resource Investment Conference, I emerged with a profound degree of confidence that this company is in immensely capable hands. The experts at Silver Wheaton (NYSE: SLW ) would seem to agree, as the company holds some 10 million shares (see below). The silver professionals at Silver Wheaton have never steered me wrong, and their identification of meaningful exploration upside within Alexco Resource's (AMEX: AXU ) Keno Hill district in the Yukon has certainly been right on the money.
I wish every Fool could have been there beside me to meet Mr. Rodriguez, but I am hopeful that his warm and affable nature, his unmistakable intellect, and his infectious excitement for his company's future shine through the following excerpts from the interview. I want to start here in Part 1 of this discussion with Mr. Rodriguez's story and how he came into the CEO position. I believe investors will find it an interesting tale. In Part 2, we'll delve into the specific means by which Aurcana expects to launch straight into mid-tier production status on its way to becoming a major silver producer within an accelerated timeframe.
Christopher Barker: I wanted to congratulate you on a powerful growth story in the making. I recently selected Aurcana as my No. 5 pick among my Top 10 Silver Stocks for 2012 ...
Lenic Rodriguez: Well, you're only off by four [laughs].
Barker: How did you become involved with Aurcana?
Rodriguez: I became involved with Aurcana because the company approached me to find for them some substantial opportunities in Mexico. They had been operating for 10 years. The stock was trading at $0.04 to $0.05, and the market cap was $4 to $5 million. Within 45 days, I found two projects for Aurcana. One was a copper project that they wanted to own, but they could never make a deal. Now, I own that one personally. The other one was La Negra. I raised the money for 60% of it and became the largest individual shareholder and a director. But I was not really involved in management. I was living in New York. But the stock went in six months from $0.14 to $2.00, and then there was a very long, painful slide of 18 months. We went all the way from $2 back down to $0.13 and then under $0.10, and we stayed like that for over a year. I didn't think the company was going to live for another 90 days. At that time, I was appointed as President and CEO of the company, and during my due diligence I discovered there was no clear direction of where to go and no sense of urgency. But I had a very substantial amount of money invested in this company. So I very reluctantly became involved, and within 60 to 90 days we started to make money, and finally we negotiated to buy back our silver stream with Silver Wheaton.
Barker: Is Silver Wheaton still a shareholder?
Rodriguez: Ten million shares, because I asked them to participate in the private placement, and they are very pleased to be a shareholder. We have a very good relationship with all our shareholders. And now we are viable; we are vibrant... and we are on our way.
Barker: And what was your professional background before getting involved?
Rodriguez: I was born, raised, and educated in Mexico. I received my business degree with honors from the Jesuit University in Mexico, and my master's degree in systems engineering as well. I was one of the 100 top executives in the country by the time I was 30. I had a joint venture that I formed with the second largest construction company in the world -- Philipp Holzmann -- so I've always been very entrepreneurial. After moving to Canada, I got involved in finance with an investment bank out of the U.S.
Then I was conducting financings for companies in the U.S., Mexico, and Canada, and that's how I got involved with Aurcana. Last year, I raised for the company about $100 million. You have to remember the market cap about a year ago was $30 million. Today, it's $320 million. So the dilution we have had has been accretive dilution. We went from $0.08 or $0.09 to $0.70 (so about nine times). And the dilution has been triple, so that is accretive dilution.
Barker: What sets Aurcana apart?
Rodriguez: Basically, we have the highest growth profile of all our peers. We are weeks away from surpassing all of them: Alexco, Fortuna, Endeavour. Our stock price is $0.70. Those companies are trading at $600 million to $1 billion or more. We are at $320 million. So if someone can do the math, see where we're going, and look into the future, I haven't seen anything that can get me as excited as I am about Aurcana.
Please click here for Part 2 of this discussion with Aurcana CEO Lenic Rodriguez.
Measured & Indicated: 1.248Mt @ 105 Ag g/t (3.4oz/t) for 4.2Moz Ag and 7.5 Moz AgEq
Inferred: 0.262Mt @ 78.6 Ag g/t for 0.7 Moz Ag and 1.4 Moz AgEq
Measured & Indicated 2.795Mt @ 8.6 oz/t (267 g/t) for 24.0Moz Ag
Inferred: 2.167 Mt @ 10.5 oz/t (326 g/t) for 22.8 Moz Ag
"We're expecting a resource update at La Negra by mid-February. We are going to add about 1 million tons, which will be a substantial increase from what we now have, and these will come from the 1950 level ... the first time we have gone so deep into the mine. The haulage level is at the 2000 level. So all of the orebodies -- these 28 orebodies -- are above the haul level; all of them are gravity fed. And all of them are open. So we're down in the 1950 level now, and we have about 1 million tons here, (with more copper than silver).
Meanwhile, at the 2400 level in the Northwest Trend, we have two orebodies that seem to connect; bridging an 800-meter gap. We're already drilling 400 meters into it, and we need to drill the other 400 meters. And if they do connect, we have the potential for about 4 million tons there, and the grades are around 100 to 200 grams per ton of silver."
Posted by Christopher Wood at 20:41
Aurcana is my favourite silver stock right now and I own a bunch. Here are the the events that I believe will drive the share price significantly higher over the next couple years:
In addition to all this, you get a free option on rises in the price of silver. Silver is currently ~$33/oz. The inflation adjust past peak for the price of silver is well north of $100.
Assuming Aurcana can deliver on all their objectives listed above and the market rewards them with a P/E of 8 (similar to current P/E of their peers: HL, PAA, CDM) and they don't issue any more shares (which at this time they have no plans to do), I have the following share price targets for the end of 2013:
Great stuff MGH, I own some AUN, and my father as well, I agree with all your analysis, this stock is cheap here, and could be the best bargain in the silver sector.
The funny thing with your price targets is the tiny PE of 8, what happens when we see PE's in the 30's or 50's, this is going to be fun!!!
If you are following the progress toward production at Shafter and The Company becoming a mid-tier Silver Producer. Here's a recent article:
Aurcana started at 1.0 by Bill Matlack on March 13 !
Scroll down to Silver and you'll see that Aurcana is rated higher than Revett, Scorpio, Silvercrest etc etc.
"Reports that a giant new vein of silver was discovered in Shafter weren’t completely denied by the Rio Grande Mining Company this week."
Aurcana Corporation (AUN: TSX.V) - 3/28/2012
The BTV crews travel to Texas to witness the resurgence of the Shafter Mine,
which when in production by mid- year, will be the second largest producing
pure silver mine in the U.S.
some core miner holdings have been hurt this week....Scorpio mining and Fortuna. Fortuna may likely bounce back ok, scorpio might flounder.
Miners can flounder and fail cant they. one really bad drill series forcing a complete re-eval of the whole forward projection,which the CEO says could have a negative impact on the future of the company ....huh?? (Scorpio mining) ...one big problem with a mine's structural integrity (AEM)
one poor acquisition (Kinross)
one act of violence (FSM)
one government coup in Mali ( Guyana goldfields and Avion gold)
Golden Baloney Mountain is starting to look better and better .(inside joke...)
Can we possibly make it back to break even with one more decent rally in the coming month?
Last years speculation plays for me included Golden Predator....50 cents seems a good place to buy and sell some at 1 dollar...how hard is that to do? But all we do is keep waiting and waiting on it.
Geologix has been showing alot of life these days ....but everything seems to be floundering these days, either a little or a lot.
Silvermex just went soaring on the great drill news and is now floundering.
You think you find a good one to speculate on, and it goes soaring nice like Sandstorm. a rarity these days. Now watch it go plunging , at some point.
Show me any miner big or small that is immune to all the risk factors,the manipulation, the shorting, whatever the game is , just show me one.
For the longest time (look at the chart) Scorpio mining was staying strong , nice uptrend, while all others were going down.....now look at what happened when the year end report came out this week.
You happy now? Show me a great miner to invest in. The other day,BOG said Moneta Porcupine was the best penny to buy these days....something like that. ok, I'm ready to buy some. stink bid at 21 and will sell 1/2 at 40 cents.
Now my hopes are invested in Aurcana
Monday, April 02, 2012 9:19 AM
Aurcana Corp. (TSXV: AUN)(OTCQX: AUNFF) says that construction at its wholly owned Shafter Mine in Texas is two months ahead of schedule and that the company has expanded its daily tonnage production to 2,000 metric tons per day at its La Negra Mine in Mexico. “We are pleased to be two months ahead of schedule and an estimated $1 million below budget at Shafter Mine,” says Lenic Rodriguez, president and chief executive officer of Aurcana. “With the completion of the expansion at La Negra to 2,000 tpd, Aurcana is on target to become a mid-tier silver producer and anticipates 12-month production 3.8 million ounces of silver from Shafter and 1.3 million ounces of silver from La Negra.” Aurcana is a Canadian junior-mining company with projects located in North America.
By Alex Létourneau of Kitco News; aletourneau[at]kitco[dot]com
Aurcana Reports Record 2011 Results
April 16, 2012 TSXV: AUN, OTCQX: AUNFF
The most significant highlights for 2011 were:
1. Earnings increased $ 21.6 million from mining operations in 2011, $23.2 million compared to $1.6 million in 2010.
2. $16.3 million increase in net income, $7.7 million in 2011 compared to ($8.6) million loss in 2010.
3. Revenues increased 76% to $45.9 million in 2011 from $26.1 million in 2010.
4. Operating cash flow after taxes before movements in working capital items, to $19.5 million in 2011 (2010 loss of $3.7 million).
5. Total Equity almost doubled to $139.3 million from $71.3 million.
6. Achieved 9% decrease in production costs per silver equivalent to $10.10 (2010: $11.03)
7. Silver production of 1,007,256 ounces in 2011 compared to 838,077 ounces in 2010.
8. Silver Equivalent production of 1,741,702 ounces in 2011 compared to 1,354,315 ounces in 2010.
9. Initiated upgrade of La Negra mill from 1,500 tpd to 2,000 tpd in 2011, upgrade completed March, 2012, a 33% increase in processing capacity.
10. Shafter Silver Mine in Texas initiated construction February, 2010 and commissioned the processing plant April 1, 2012, two months ahead of schedule and under budget.
The Company had earnings from mining operations of $23.2 million for the year ended December 31, 2011 (2010: $1.6 million); income before taxes of $9.6 million (2010: loss for $9.1 million); a net income of $7.7 million (2010: loss for $8.6 million). Earnings per share increased to a profit of $0.02 per share from a loss of $0.06 per share in 2010.
The increase in earnings from mining operations was mainly related to increased volumes sold and the increase in the selling prices of the metals produced by the Company.
During the year ended December 31, 2011, the Company generated revenues from the sale of 8,119 tonnes of copper concentrate (2010: 11,821 tonnes); 9,836 tonnes of zinc concentrate (2010: 5,273 tonnes); 2,303 tonnes of Lead Concentrate (2010: nil); and 1,007,256 ounces of silver (2010: 808,921 ounces) for total net revenues of $45.9 million (2010: $26.1 million).
The average price for sales of copper, silver, zinc and lead during the year were Cu - $4.04 (2010: $3.50) per pound; Ag $35.25 (2010: $21.50) per ounce; Zn $0.97 (2010: $0.99) per pound and Pb $1.03 (2010: nil).
Full article at: https://www.irw-press.com/en/news_15636.html
May 25, 2012
Aurcana Reports: Record 1st Quarter Results
La Negra Mine Production Highlights
Shafter Mine Highlights
To read complete Financial Statement click on this link: https://www.aurcana.com/i/pdf/2012Q1FS.pdf
To read complete MD&A click on this link: https://www.aurcana.com/i/pdf/2012Q1MDA.pdf
Anybody who takes on Sprott (and wins) is "A" number one in my books.
By Christopher Barker | More Articles
June 4, 2012
Full article at: https://www.silverstrategies.com/story.aspx?local=h&id=83275
.....Nowhere within that deep well of history was the project thought to contain significant quantities of gold. And yet, gold accounts for roughly 11% by weight of the first dore bars poured at Shafter! While there can be no guarantee that these surprising gold values will continue, at 11% of the dore content, gold accounts for roughly 88% of the anticipated revenue from these first dore bars. Expressed another way, the market value of a dore bar containing 11% gold is roughly seven times that of its silver-only counterpart."
Aurcana CEO Lenic Rodriguez demonstrates one of the very first dore bars produced at Shafter since the Presidio mine closed in 1942. Rodriguez has two reasons to smile, as he celebrates not only the project's timely completion under budget, but also the encouraging gold content of these early realized results.