SLR - Silver Lake Resources

[Uncle Festivus]

Symbol SLR
Issuer Name SILVER LAKE RESOURCES LIMITED
Security Description ORDINARY FULLY PAID

Last Price $0.380

Symbol SLR
ISIN AU000000SLR6
Issuer Name SILVER LAKE RESOURCES LIMITED
Security Description ORDINARY FULLY PAID

Fundamentals
Total Class Issue 103,412,658
Market Capitalisation $39,296,810

52week High/Low 0.495 / 0.345

Silver Lake Resources Limited (“Silver Lake”) is pleased to announce that it has successfully completed its Initial Public Offering (“IPO”) of 100 million shares at an issue price of 30 cents per share raising gross proceeds of $30 million. Silver Lake has been admitted to the official list of ASX and commenced trading at 2.00pm EDST on 14 November 2007.

Silver Lake is an emerging gold producer and exploration company with a resource base of 830,000 ozs of gold across its portfolio of assets including the Mount Monger goldfield and its Murchison projects (Moyagee, Tuckabianna and Rothsay). Silver Lake has targeted projects with certain attributes including:

• Dominant position in a highly prospective region
• Sound economic indicators
• Near term production ability
• Existing JORC resources with significant growth potential
• Lack of prior systematic exploration

Proceeds raised under the offer will be used to finalise the purchase of Silver Lake’s projects, re-open the Daisy Milano mine to recommence gold production and advance the neighbouring exploration program.

 

[daggs]

A fair bit happening in the next few months,one to watch IMHO
Here's a summary of recent activity at Silver Lake. (From company announcements)

Highlights
• Daisy Milano ore production to date exceeds 4,000 gold oz
• Underground drilling at Daisy Milano provides numerous high grade intersections
• Near mine exploration under way at Caledonian and Haoma
• Lakewood Gold Processing Facility modification and refurbishment programme on schedule
• Lakewood Gold Processing Facility commissioning strategy in place and scheduled for late March/early April

The Comet tenements contain a JORC Indicated Resource of 1.44 million tonnes at 3.0 g/t Au for 154,000 oz; and an Inferred Resource of 374,000 tonnes at 5.8 g/t Au for 77,000 oz. The acquisition will increase Silver Lake’s total gold Resource to 5.70 million tonnes at 5.3 g/t Au for 1,060,000 oz.

Underground Infill Drilling at Daisy Milano;
These results include numerous high grade instersections and are consistent with the resource grade of 33.5 g/t. Figure 1 below shows the position of these intercepts.

As well as this drilling, there has been substantial work reviewing historical data to improve the geological understanding at Mount Monger and as a consequence the Company expects to announce an upgraded resource in late March 2008.

Approximately 90% of ore production to date has come from areas outside the current resource demonstrating the potential for further increasing the resource base.

Near Mine Exploration
The near mine exploration strategy has focused on finding additional orebodies close to existing Daisy Milano infrastructure. Progress to date includes:
• Caledonian trend: seven surface RC holes (1,945 m) of a planned sixteen hole programme have been completed. The balance of the programme will be completed by July 2008.
• Haoma trend: a twelve-hole underground drilling programme totalling 3,000 m at Haoma has commenced (see Figure 3). To date two holes totalling 390 m are complete. The Haoma trend was historically mined at a grade of 28.9 g/t. However, the operator ceased mining at the boundary to their lease holding. Now that Silver Lake controls the consolidated Mount Monger region, there is no impediment to mining the down plunge extent of previous workings. This drilling programme will test the viability of resuming mining at Haoma.

TimingActivity

March 2008; Installation of new mine compressors and commencement of two additional air leg miners

March 2008 to September 2008; Extend Mount Monger decline to 21 level and complete drilling between 21 and 25 levels

Late March 2008; Complete Lakewood Gold Processing Facility modification and refurbishment programme

Late March 2008; Implement Lakewood Gold Processing Facility commissioning strategy using low grade stock feed

Late March 2008; Announce new resource at Mount Monger

April 2008; Commence feeding Daisy Milano high grade ore stock

Late April 2008; Caledonian & Haoma trends – receive initial assay results

May to July 2008; Caledonian & Haoma trends – complete drill programmes

July 2008; Ramped up to 35,000 to 40,000 oz per annum rates
Assay results are expected for the completed holes by late April 2008.

 

[Kobsy]

I live in Kalgoorlie WA and supply fuels and lubricants to Silver Lake resources. Top grades, able to deliver on targets thus far and have a very dominant position in the Goldfields region of Western Australia. Smack bang next door to Integra Mining also One to watch yes imo

 

[daggs]

G'day Kobsy,

Good to have some positive feedback from a local.
fuel deliveries around Kal, sounds like the perfect job for a share trader

 

[daggs]

ann out today,

Highlights
• High grade resource increase at Mount Monger extends estimated Daisy Milano mine life to five years
• Maiden high grade Measured Resource of 93,600 tonnes at 37.9 g/t Au for 114,100 oz at Daisy Milano
• Initial open cut Inferred Resource of 205,000 tonnes at 3.80 g/t Au for 25,500 oz with near term mining potential at Lorna Doone and Costello
• Overall increase in total resource to 5,931,300 tonnes at 5.8 g/t Au for 1,100,600 oz

 

[Kobsy]

Hey Daggs,

Yeah definately a local mate. Have lived in the Goldfields for 20yrs now but i wouldn't say i have the perfect job for a share trader... The perfect job for a share trader would be no job, trading shares profitably. LOL

 

[ScottMG]

First Gold pour out of the refurbished Lakewood facility today. A lot of upside to this company. A highly reputable management structure. Big tick Gold price heading in and upward direction. With the roadshow presentation happening around oz during May i'm sure more punters will jump aboard. Best of luck to all that hold. Today's price is 33c. I'm sure it will be closer to 50c by end of june 08

 

[treefrog]

from the Perilya website:

In January 2005, Perilya acquired the Daisy Milano gold mine, southeast of Kalgoorlie. Despite a successful first year of operationg under Perilya, extraction at Daisy Milano was suspended in March 2007 and the gold mine was put into care and maintenance while the divestment of Perilya's gold assets was finalised and the company refocused its strategy on base metals.

In August 2007, the gold assets comprising the Daisy Milano mine, and the Mount Monger, Moyagee and Honeymoon Well exploration projects were sold.

obviously SLR expect to make DaisyM profitable but so did PEM and PEM cut their teeth and made a very profitable start as a Co mining gold but couldn't make a go of DM. It appears to have been a significant factor in the demise of PEM's CEO who "resigned suddenly" recently

with SLR due to report their actuals againt target soon, should be a good gauge of SLR's capabilities/prospects

SLR 10dec 07 ann

Silver Lake expects to produce 10,000 – 15,000 oz of gold from Daisy Milano by 30 June 2008, and ramp up to 35,000 – 40,000 oz of gold per annum production rates from 1 July 2008.

 

[Kobsy]

Silver lake gain 11% yesterday on high volume of around 600k compared to av. monthly vol of about 280k. opened this morning up 7%- 9% on continued higher volume.

yay!!

Good luck to all holders

PS Anyone any idea's about the increase in volume.

 

[Johno]

This stock seems to be on the move. Any others out there hold this stock or have any opinions on its future? Its gained 35% in two days!

 

[Miner]

There was no posting on SLR for last three months or so

I recently read in Eureka Report about a BUY recommendation on SLR with a target price of 67 cents

Any researcher's comments please .

Attached the report

 

[Mickyd]

It's not often that I come across a gold miner that I feel compelled to buy. However SLR is the first to catch my eye in about 3 years. I'm excited but it's not for the resource or the production, it's for the excitement for making myself money. SLR have a very nice story and even with very conservative estimates, they stand to make at least $20M/Y in profit for a company with only a $50M market capitalisation. And that is the key to making money on this venture. The small market cap. The also have $14.5M in cash.

SLR made $8million just last quarter. Thats not including the fact that only 40,000t of ore was milled when 45,000t was extracted. It also doesn't include $0.7M of gold unsold. However it was based on A$1400 gold price. Even with gold at A$1250, they would have made $6.7M for the quarter.

SLR plan to extract 15,000t per month or 180,000t per year for the 300,000t processing plant. They also plan to bring Christmas Flats into production at a starting rate 10,000 oz per 6 months in June 2009. Just Daisy Milano alone is a 50-60,000 oz per year operation.

Having a look over it's competitors and nothing comes close. Looking at other producers like HEG and CTO and the story looks extraordinary. CTO has a market cap of $140M, no cash and is losing $10-15M per year. HEG has a market cap of $46M and has yet to prove it can make a dollar and little cash.

Instead of using poor examples, I will use a respected gold producer in DOM. DOM has a market cap of $546M and produced 109,000 ounces last year and plans to produce 105,000 ounces this year. DOM has $55M in cash and made about $33M profit last year. It also gave back $12.3million in dividends at 12cents per share. That's a dividend yield of 2.4%. DOM also carry a $9M burden from a "out of the money" hedge book.

DOM's Challenger Mine has 727,860 oz in reserves and a total mineral resource of 1,159,830 oz with average head grade of 8.8g/t. Mine life is 7 years at current reserves and production. Concerns over SLR's 5 year mine life only need to look at DOM's early reserves. I feel SLR is about 3-5 years behind DOM in development. DOM only had 200,000 oz reserves when it was producing 50,000 ounces in 2004.

SLR's management is also reviewing dividends. An equivalent dividend to DOM would be only 1 cent per share. That would only cost the company about $1.1M per year. Remember DOM's market cap is 11 times larger than SLR's and has only about 2 times higher production rates and 3 times higher cash on hand.


I have noticed Sprott Asset Management Inc have bought in recently and from accounts on other chat sites, they have a poor record. However a 17.12% return since 2001 is very good in my opinion considering the pain of last year. All funds were punished last year. It means little in the end anyway.

On fundamentals alone, SLR should have a market cap above $100 million. That's double to current share price.

 

[JTLP]

It's not often that I come across a gold miner that I feel compelled to buy. However SLR is the first to catch my eye in about 3 years. I'm excited but it's not for the resource or the production, it's for the excitement for making myself money. SLR have a very nice story and even with very conservative estimates, they stand to make at least $20M/Y in profit for a company with only a $50M market capitalisation. And that is the key to making money on this venture. The small market cap. The also have $14.5M in cash.

SLR made $8million just last quarter. Thats not including the fact that only 40,000t of ore was milled when 45,000t was extracted. It also doesn't include $0.7M of gold unsold. However it was based on A$1400 gold price. Even with gold at A$1250, they would have made $6.7M for the quarter.

SLR plan to extract 15,000t per month or 180,000t per year for the 300,000t processing plant. They also plan to bring Christmas Flats into production at a starting rate 10,000 oz per 6 months in June 2009. Just Daisy Milano alone is a 50-60,000 oz per year operation.

Having a look over it's competitors and nothing comes close. Looking at other producers like HEG and CTO and the story looks extraordinary. CTO has a market cap of $140M, no cash and is losing $10-15M per year. HEG has a market cap of $46M and has yet to prove it can make a dollar and little cash.

Instead of using poor examples, I will use a respected gold producer in DOM. DOM has a market cap of $546M and produced 109,000 ounces last year and plans to produce 105,000 ounces this year. DOM has $55M in cash and made about $33M profit last year. It also gave back $12.3million in dividends at 12cents per share. That's a dividend yield of 2.4%. DOM also carry a $9M burden from a "out of the money" hedge book.

DOM's Challenger Mine has 727,860 oz in reserves and a total mineral resource of 1,159,830 oz with average head grade of 8.8g/t. Mine life is 7 years at current reserves and production. Concerns over SLR's 5 year mine life only need to look at DOM's early reserves. I feel SLR is about 3-5 years behind DOM in development. DOM only had 200,000 oz reserves when it was producing 50,000 ounces in 2004.

SLR's management is also reviewing dividends. An equivalent dividend to DOM would be only 1 cent per share. That would only cost the company about $1.1M per year. Remember DOM's market cap is 11 times larger than SLR's and has only about 2 times higher production rates and 3 times higher cash on hand.


I have noticed Sprott Asset Management Inc have bought in recently and from accounts on other chat sites, they have a poor record. However a 17.12% return since 2001 is very good in my opinion considering the pain of last year. All funds were punished last year. It means little in the end anyway.

On fundamentals alone, SLR should have a market cap above $100 million. That's double to current share price.

Wasn't one of their mines a problem for another company?

What are their total costs per ounce?

How much gold they got in them hills?

Thanks!

JTLP

 

[Mickyd]

Wasn't one of their mines a problem for another company?

What are their total costs per ounce?

How much gold they got in them hills?

Thanks!

JTLP

Yes, PEM did own the mine they are currently making money from. SLR bought the mine about 18 months ago and have turned it profitable. PEM had trouble making a profit. That's what makes the team of ex-WMC guys even better. Turning a "unprofitable mine" into a money pit.

The company said operating cash costs were $488 p/oz and total cash cost at $659 p/oz. However I say "real" cash costs at $782.

SLR have a total of 1,473,100 ounces but should be built up in the coming years.

 

[urgalzmine]

Hey Everyone

I am very surprised that there is no topic for SLR? or did i not search hard enough. Anyways if there is a thread for SLR i apologise,


Lets get to the fun stuff. Can someone find me a company that has these prerequisites:

No debt
MC less than $80million
Produces 40 000 ounces per year
Sp below 60cents
cash in hand $14million
cost per ounce below $500


You guessed it its SLR.

Here is a little bit of history:
Silver Lake is a gold producer and explorer with a resource base of 1.5 million oz in highly prospective regions including the Mount Monger goldfield and the Murchison (Tuckabianna, Comet, and Moyagee). Silver Lake’s strategy is to develop large production centres at Mount Monger and at the Murchison with multiple mines at each centre. Silver Lake’s Mount Monger Operation contains the Daisy Milano mine located 50 km south east of Kalgoorlie. Mount Monger has multi mine potential underpinned by emerging open pit production from Christmas Flats.



What does anyone think ?

 

[johannlo]

It does look tasty doesn't it. But where did you get the no debt bit from? 70k in interest payments this quarter from the latest balance sheet.

Agreed the cashflow is positive and looks like growing. Just hesitant about buying in at 'peak' prices so far. Does anyone want to do a rough valuation based on currently known deposits and production prices/margins?

 

[urgalzmine]

It does look tasty doesn't it. But where did you get the no debt bit from? 70k in interest payments this quarter from the latest balance sheet.

Agreed the cashflow is positive and looks like growing. Just hesitant about buying in at 'peak' prices so far. Does anyone want to do a rough valuation based on currently known deposits and production prices/margins?

The ann dated 12th may 2009, page 24, under finance its states that there is no debt.

have a read of the ann

 

[johannlo]

OK got it thanks. looking even better then lol

No idea then why in the march quarterly report under appendix 5b, under Repayment of borrowings they have (70k) for the quarter and (203k) for the FY so far. Investsmart has 7.7million total liabilities of which 6.1 is current (majority is trade creditors) though thats FY08 figures.

And of that only 0.5million is borrowings so its entirely conceivable that by now that's been wiped.

Thanks for pointing that out

 

[Mad Jack McMad]

SLR on a tear today - is this down to the Mt Monger drill results?

Silver Lake Resources Ltd (“Silver Lake”) is pleased to announce an update on
underground and surface drilling activities at its Mount Monger Operations.
Silver Lake has conducted an eight hole underground drilling program from the Daisy
Milano mine 8 level (approximately 250 metres below the surface) targeting the
Rosemary orebody located approximately 130 metres to the east.
During this programme as well as confirming the location of the Rosemary structure, two
additional structures were intersected approximately 40 and 85 meters from Daisy Milano
respectively.
These structures show sericite pyrite alteration with some intercepts containing visible
gold (Refer to Figure 1). The area defined by this programme is approximately 150 lateral
metres by 40 vertical metres. Drilling in the area is planned to resume once assays have
been returned from this current underground programme in late July 2009.

http://clients.weblink.com.au/clients/silverlakeresources/article.asp?asx=SLR&view=6448324

 

[Mad Jack McMad]

More rises for SLR -

Research note

http://www.silverlakeresources.com.au/files/files/108_SLR19may08v2.pdf

Quote
"SLR has a target of producing at 150,000ozpa within 3 years (2011), which could be achievable, based on possibly 50,000ozpa to 70,000ozpa from Mount Monger and a mining operation at Comet/Tuckabianna (although Mount Monger could be capable of achieving 100,000ozpa in its own right).
•
SLR appears to have significant upside potential with both of its current main project areas of Mount Monger’s Daisy-Milano, and Comet/Tuckabianna apparently capable of exceeding expectations in production and grade. Also on a market cap comparison basis to its peers, SLR appears to be well undervalued and capable of achieving a market cap > A$120m."