Jim Williams could hardly have timed it better. After spending the last six years developing silver projects in Mexico, production from his company’s flagship San Jose mine finally got underway in September. Just weeks later a near-two year rally in the price of silver saw the precious metal reach a 30-year high of $30.75 an ounce on New York’s Comex exchange. For Williams and Arian Silver Corp (LON:AGQ) , the potential for 200m ounces in the ground is something to get excited about.
From modest beginnings, Williams’ eye for a project and no shortage of luck, has created a company with a handful of exploration projects and the all-important production base in Mexico’s Zacatecas State. At San Jose, the company’s contract mining and milling operations are scheduled to process 500 tones of ore per day to produce a silver-rich powdery concentrate worth $6,500 per ton based on a silver price of $18. So far Williams and his team have concentrated their efforts on the resources of just 10% of their San Jose Vein. That has landed them with a JORC-compliant resource of around 43 million ounces of silver, 120 million lbs of lead and 250 million lbs of zinc. Unsurprisingly, Williams is keen to forge ahead with further drilling elsewhere on the vein – indeed that work is underway.
But while Williams commitment to getting the project into production has finally reaped rewards, the company has not had an easy time during the recession. Between the autumn of 2008 and late winter 2010 its share price failed to break 5p. Anticipation over work at San Jose got things moving over the summer but it wasn’t until production began in September before the shares enjoyed a substantial re-rating – they are currently trading just off a high of 40.75p. The surge in interest in recent months matches the charts of other, larger Mexico-based silver specialists, Fresnillo (LON:FRES) , which is the world’s largest primary silver producer, and Hochschild Mining Plc (LON:HOC) . Among its smaller cap peers, Irish miner Minco (LON:MIO) is also active in Mexico, while silver projects also form part of the portfolios…
Very good Interview. Thank you.
I have been buying these recently, it is a play on silver. I love companies like Arian which uses production to fund exploration. They have only proved up about 10% of their resource and estimates are for loads more silver.
I think these will get taken over eventually once Jim and Co has proved up most of the resource.....
