Investor site AheadoftheHerd.com suggests that it's time to turn your attention to Kootenay Gold Inc. (CVE:KTN) if you believe in the adage "mines are made, not discovered".
Drawing from the experience of its management team, led by chief executive and chief geologist James McDonald, Kootenay is applying the same pragmatic approach to its flagship Promontorio Silver Project in Sonora Mexico, that has helped companies McDonald has been associated with, such as Alamos Gold (TSE:AGI), turn into accomplished producers.
Since first acquiring the historic past producer in 2005, Kootenay has taken no shortcuts in its quest to systematically exploit the vast silver resources believed to exist within Promontorio’s 79,000 hectare borders.
Based on its success to date and the projects maturing status, the company’s comprehensive approach appears to be paying off, Rick Mills of the AheadoftheHerd.com newsletter said.
Kootenay Silver's strategy has been to build a company incorporating both the property ownership dilution business model and share dilution model.
They have several projects joint ventured with other junior explorers who pay costs for exploration and issue shares in their company while Kootenay has retained 100 per cent ownership of their flagship Mexican property,the advanced stage Promontorio silver project.
A 43-101 Resource Estimate released in August of 2010 shows the Promontorio Silver Project contained indicated and inferred resources of over 10 million ounces of silver along with substantial amounts of lead and zinc. The overall contained metal values at Promontorio were estimated at $320 million.
Since August 2012, Kootenay Silver put out two significant news releases, the first was in regards to an updated resource estimate – resources have gone from an in ground value of $320 million to over two billion dollars using today’s silver price.
In two short years KTH has increased shareholder value by a factor of over six times while keeping the share count at a very respectable 59.5 million fully diluted.
The open pit mineral resources for the Promontorio Project are 36,018,000 tonnes grading an average of 51.35 grams per tonne (g/t) silver equivalent classified as Measured and Indicated Mineral Resources, with an additional 9,136,000 tonnes grading an average of 42.86 g/t silver equivalent classified as Inferred Mineral Resources.
This resource is stated above a 15.00 g/t cut-off grade and contained within potentially economically mineable pit shells.
Underground mineral resources are 2,216,000 tonnes grading an average of 48.75 g/t silver equivalent classified as Indicated Mineral Resources, with an additional 3,077,000 tonnes grading an average of 53.90 g/t silver equivalent classified as Inferred Mineral Resources.
The resource is stated above a 35.00 g/t cut-off grade to reflect the higher mining costs associated with underground production.
Rick Mills is the owner of Aheadoftheherd.com and invests in the junior resource/bio-tech sectors.