Silver47 Exploration Corp. will start trading around Nov. 12 on the TSX Venture Exchange under the ticker symbol AGA, having received conditional approval to do so, the company announced in a shareholder letter.
"With silver prices breaking out, we are excited to bring the Silver47 story to the market, and I believe that we are in for a good run," Chief Executive Officer (CEO) Gary Thompson said.
The company is "extremely undervalued" when compared to peers, at US$0.17 per silver equivalent (Ag eq) ounce, Thompson told Streetwise Reports in a Nov. 6 interview.
The CEO also noted that Silver47 may begin ramping up its marketing efforts, given the final prospectus is now filed.
"This is the first week where we've been able to really start talking about the story," he said.
Building Silver Ounces
Based in British Columbia (B.C.), Silver47 is a mineral explorer with a diverse portfolio of silver-polymetallic projects in North America, including Red Mountain in Alaska, Adams Plateau in B.C., and Michelle in the Yukon. Its flagship asset, Red Mountain, is a volcanogenic massive sulphide (VMS) deposit, rich in silver, gold, zinc, copper, and lead.
"When you have these three or four or five metals, they actually normalize your production profile and also increase your margins," Thompson noted.
Red Mountain's current NI 43-101-compliant resource stands at 15,600,000 tons (15.6 Mt) of 7% zinc equivalent in the Inferred category. This is equal to 168,600,000 ounces (168.6 Moz) of 335.7 grams per ton of Ag eq.
"This is a huge silver discovery engineered by Crescat [Capital]," Chen Lin, asset manager behind What is Chen Buying? What is Chen Selling? wrote on Oct. 28. "[The project] has a lot of exploration upside."
The company aims to expand the Red Mountain resource to 500–900 Moz of Ag eq and advance it toward development, all through further exploration, including an aggressive drill program.
"Our goal is to really focus on the precious metal part of the system," Thompson said. "That's the reason we got interested in it, simply because of some impressive silver and gold hits in the system, and we want to flush those out. And so we're going to try and improve that precious to base metal ratio."
Thompson highlighted how minerally endowed and prolific VMS systems can be, citing the Sullivan and Kidd Creek mines as examples. Sullivan, a historical mine in Kimberley, B.C., produced 26 Mt of lead, zinc, and silver concentrates in its roughly 100 years of operation between 1909 and 2001. Kidd Creek, in Ontario, Canada's Abitibi greenstone belt, is one of the world's largest VMS ore deposits. The operation began producing copper, zinc, and silver in 1966 and is now owned by Glencore International Plc (GLNCY:OTCMKTS; GLEN:LSE).
Red Mountain, located about 100 kilometers south of Fairbanks on state-managed lands, is in a top-tier, pro-mining jurisdiction. Alaska ranked as the 11th most attractive jurisdiction for mining investment, out of 86 places worldwide, last year, according to the Fraser Institute.
"We have strong support from the state to advance this and to work with us on upgrading these various infrastructure components to the project," Thompson said, referring to enhancing the road access for example. Project accessibility is reasonable, he added, but has room for improvement.
Silver47 boasts an experienced technical and management team, led by founder, geologist and company builder Gary Rhompson, who also is cofounder, chairman and CEO of Brixton Metals Corporation (BBB:TSX.V). His experience in resource exploration, including precious and base metals, spans 27 years, 15 of them in public markets. His history includes positions at Newmont Alaska Ltd. and NOVAGOLD Resources Inc. (NG:TSX; NG:NYSE.MKT), as well as discovering and selling the TAG gold-silver prospect to Taku Gold Corp. (TAK:TSX.V; TAKUF:OTCMKTS). Also, he sold the Kahuna claims in Nunavut, near Agnico Eagle Mines Ltd.'s (AEM:TSX; AEM:NYSE) Meliadine mine, to Kodiak Copper Corp. (KDK:TSX.V) and Solstice Gold.
Experts Still Bullish on Silver
Today, U.S. election euphoria is boosting the stock markets but depressing precious metals, noted Technical Analyst Clive Maund in a report on Nov. 6. On this day, hours after the U.S. president-elect was announced, silver opened at US$31.04/oz, lower than the day before by 5.22%. Only two weeks ago, the price, in comparison, had broken through US$35/oz.
This current bearish trend should end once the high surrounding the election dissipates and reality sets back in, Maund purported. When this happens, "we will see money flow back into the precious metals and other such assets, as they must hold their value in an environment where inflation is continuing to mount," he wrote.
According to economies.com on Nov. 6, for the silver price to turn around, it first must breach US$32.50 then $33.04/oz. This will "push the price to turn to rise."
While the price of silver experiences volatility, its supply and demand fundamentals remain constant. Worldwide demand for silver, valued as an industrial and a precious metal, is expected to increase 2% this year over last, to 1,200,000,000 ounces, yet supply is projected to drop 1%, according to The Silver Institute. This year, the global silver market is forecasted to face a deficit of 759 Moz, the equivalent of about three-fourths of one year's supply, Money Metals reported The Silver Investor's Peter Krauth saying in a recent presentation.
Most, or 61%, of silver demand, is for industrial applications, including electrical, electronics, printing, plastics and photography. Given its use in electric vehicles, photovoltaic panels and batteries, silver is critical to the global green energy transition. Demand for use in photovoltaic panels alone this year will be about 232 Moz, nearly three times the 80 Moz needed in 2020, according to The Silver Institute.
The remaining 30% of total global silver demand breaks down like this: 17% for jewelry, 5% for silverware and 17% for investments.
New applications of silver continue to be discovered, in biotech for example, according to The Pure Gold Co. As technology and the global economy evolve, so will silver's industrial uses, Matt Watson, founder and president of Precious Metals Commodity Management, told Kitco News. Expansion of the artificial intelligence industry will boost demand for silver, too, for use in energy storage, transportation, nanotechnology and more.
"[Silver] is the do-it-all metal on the Periodic Table," Watson said. "I don't see any fundamental downside to silver."
Looking ahead, experts expect the silver price to keep rising over time. Dominic Frisby of The Flying Frisby wrote recently, "There is not a lot standing in the way of silver and US$50. In that scenario, the miners will go to the moon. If it breaks above US$50, there is nothing but blue sky above."
Krauth thinks the silver price could actually reach triple-triple digits, or US$300/oz, based on the technical and historical indicators, he said in a recent video. "I don't believe it will stay there, but I do think that it could be in our future."
Ownership and Share Structure
Silver47 has three strategic shareholders, the company said: Silver Range with 19.9%, Crescat Capital and XT88 Holdings.
The silver explorer has a tight share structure with 50 million (50M) total shares, 65M fully diluted, noted Lin. It will begin trading with a CA$40 million market cap, Thompson said.
| Want to be the first to know about interesting Base Metals and Silver investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter. | Subscribe |
