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-- Posted Saturday, 21 June 2008 | Digg This Article | Source: GoldSeek.com
New Recommendation2008-03-31
New Recommendation Silver Crest Mines, Inc. Symbol: SVL on the TSX-V www.silvercrestmines.com Shares Outstanding: 34,736,175 Fully Diluted: Roughly 44,524,500 Phone: 604 691-1730 Toll Free: 866-691-1730
Fax: (604) 691-1761
Email: info@silvercrestmines.com I have been searching for additional silver companies to recommend for the portfolio because of my strong belief that silver is going to have amazing performance in the very near future. In the past six months I have looked at many different companies, some of which were good, but one clearly stood out from the pack - Silver Crest Mines. I first met with the company in Vancouver this past January and was very impressed with President Scott Drever. As I meet with the various executives of the junior mining companies I evaluate, Scott had the background, experience, and character I like to see. We arranged to have me visit their flagship project which is called Santa Elena, and located only a few hours drive out of Hermosillo, Mexico. As is often the case when going on a site visit, you get to truly understand what is really happening with a company since you get to spend so much time with the management team during meals, drive times and of course actually walking the properties. During my visit, I got to see the latest core coming out of the ground at Santa Elena as the company was drilling off some extensions to their already significant high grade silver/gold resource. Results from the current drilling should be coming out soon. I was also able to go underground into the historic mine that produced some 15,000 ounces of gold equivalent (total silver and gold extracted). Most of the workings remain accessible, though SVL is working towards an open pit concept, not an underground mine. As I began to understand the nature of this deposit, I clearly could see how understated this resource is. Imagine a sheet of mineralized material that is 55 meters wide and tilted at a slight angle that goes as deep as 500 meters (or more we don't know yet) and the length of which we have not yet found the end. The outcroppings at surface that originally led to this discovery also exist on other parts of the property in a parallel series. None of these potential parallel sheets or ribbons has ever seen a drill hole. The company has been solely focused for the moment on extending the length of this resource and greatly increasing, in my opinion the tonnage and ounces they now have in their 43-101 resource calculation. It almost seems like a slam dunk to me that this resource is going to grow in a major way from the 56 million ounces of indicated and inferred silver equivalent they have already identified. The old historic mine was first discovered before the Mexican Revolution in 1910 with some high grade silver/gold outcroppings near the top of a large hill in the area. The miners dug out some easy high grade material that took them down about 100 meters. In recent years the property was held by a single owner, who had been approached by several other mining companies but could never come to terms on a deal. Due to some persistence and good listening skills, the management team of Silver Crest was able to consummate a deal with this landowner to get access to the project in 2005. The company's primary focus has been to outline a resource base that can move to production with a low development cost, and leverage the company into a mid-tier producer. SilverCrest's three Mexican projects are in northwestern Sonora, clustered 150 km northwest of the state capital at Hermosillo. Two of them had small deposits established by past operators that SVL is growing and advancing. The projects are near very good local infrastructure, with roads, power and water sources on or near all of the properties. Because of close proximity to each other there is also a potential for district scale operational savings as new resources are outlined. For the purposes of this report however, I am only going to be talking about Santa Elena, which I feel is the key project to watch. I suggest you go to the company website to get an understanding of SVL's other projects which also have merit. SVL's Mexican portfolio is in the western, silver enriched portion the Sierra Madre Occidental trend. These projects are typically focused along vein like structural zones that have historically been mined from underground as high-grade deposits. Adjacent to the veins are broad "halos" of lower grade gold and silver values that modern techniques can profitably recovery. Silver Crest has focused most of their efforts on their flag-ship property at Santa Elena. with several drill campaigns and a program of underground sampling taken back in 2006. The results of those efforts led to a new independent 43-101 calculation that showed an increase of 300% in gold and silver resources from the first 9 months of work. Drilling returned up to 17.6 meters at 4.3 g/t gold & 151 g/t silver, and 28.3 meters at 2.6 g/t gold & 82.9 g/t silver. Sampling within the old workings returned up to 4.7 meters at 30.4 g/t gold & 278 g/t silver, and 11.6 meters at 3.3 g/t gold & 91 g/t silver. The drill program now underway at Santa Elena includes infill drilling and testing of extending the length of the mineralization which the company hopes will greatly increase the number of resource ounces. Initial results from the expansion testing, where the high-grade vein material still in place, are very strong. They not only indicate an expansion of the pittable resource, they confirm a potential to extend an operation into a high-grade underground phase. Highlights from Phase II drill results include: 10.9 meters of 3.3 g/t gold & 139 g/t silver (35.6 ft of 0.1 oz/ton au & 4 oz/ton Ag); 21.4 m of 2.21 g/t gold & 172 g/t silver; and 21.2 meters of 2.84 g/t gold & 101 g/t silver. The latter two holes also contained sections of 3 meters with 9.9 g/t gold & 320 g/t silver (10 ft of 0.29 oz/ton Au & 9.3 oz/ton Ag), and 3 meters with 12.7 g/t gold & 203 g/t silver. These are strong underground grades and firmly establish that the deposit's high-grade potential was not restricted to the mined out area. High-grade testing can generate a much quicker resource expansion than has been the case to date. This could mean a rapid doubling of the resource that could take us over the 100 million ounce benchmark. For silver properties, this is a key number that starts to attract bigger fish with deep pockets. A prefeasibility study is currently underway which should lead to a development decision in the coming months and potential production in the latter part of 2009. At its current share price of $1.25 a share, I am recommending Silver Crest Mines as an immediate STRONG BUY that will go directly to number nine on the Top Ten List. With the current explosive potential that I see in silver, this near-term producer is going to perform very well for investors who get in now. I would not waste too much time buying shares as drill results will be coming out soon! Greg McCoach March 31, 2008 P.S. Pictures from my site visit below
Greg with Eric Fier, Chief Operating Officer of the Company looking at a map with property in background |  Greg with a piece of the mineralized core in his hand | 
Greg with President Scott Drever | 
Group photo onsite at Santa Elena (Greg, Scott Drever, Consulting Engineer, and Property Manager) | 
Greg at drill pad that was being drilled that day | 
Photo of the general area of the mine. | 
Photo of Greg in the historic underground workings | 
Photo of underground staircase we went down. Not for the faint of heart! | 
Mineralized vein structure exposed in the underground tunnel |  |
-- Posted Saturday, 21 June 2008 | Digg This Article | Source: GoldSeek.com
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New Recommendation: Silver Crest Mines, Inc.
