I've been in AIM and TSX listed emerging silver producer Arian Silver Corp (LON:AGQ) focused on the silver belt of Mexico for some time now. Liked the story - bought the shares! Here are my reasons!
I was particularly attracted by the fact that the shares can be held in an ISA. So it was a "definite and probable" buy in my mind from the off!
The main attraction of course is the likelihood of future profit and AGQ certainly holds out the prospect of this.
The company's website gives the company strategy as:
- Obtain advanced and low-cost (acquisition cost) silver projects and rapidly build up resources in the ground. Arian is focusing its exploration efforts in one of the richest known silver-bearing districts in the world - the Zacatecas State of Mexico.
- Focus on short-term silver production. Arian is in the process of acquiring undervalued silver projects with the potential for profitable production at US$4.50 or less, and a resource potential in excess of 50,000,000+ ounces of silver.
- Focus on projects with prior exploration and production history, thereby reducing risks and capital costs.
- Arian's forward-looking strategy is to:
- Develop projects towards production through a combination of company development and/or Joint Venture (JV) and acquisition opportunities.
- Building shareholder leverage to silver through expanding silver resources and reserves, and eventually production per share.
The company has a number of silver projects in Mexico, the largest being at their now 100% owned San Jose mine. They have interests in three other projects; Calicanto; Tepal [in conjuction with their farm-in partner Geologix Inc [TSX-GLX] and San Celso. But for the time being the focus is on San Jose. Here they intend to carry out contract mining on the presently defined 10% of the overall San Jose licence area. They expect to mine 500 tons or ore per day from this but the company announced on 24th August this year that they expected to be able to increase this to 1,500 tons per day in the future [see the Press Release on the company website] . The ore mined will not be processed on site. Negotiations have been on going for some time now with a number of local milling operators and Arian expect to conclude a satisfactory agreement with the succesful toll miller soon. Once a milling contract is announced…