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Aurcana Corporation Message Board

  • pizzaman393 pizzaman393 Dec 5, 2009 9:42 AM Flag

    Financing the Shafter silver mine

    I hope the management can sell shares to finance the Shafter silver mine project, rather than sell the Shafter's production forward at a low, fixed price. In my opinion, stock dilution is a far preferable and quicker financing solution. Stockholders will see higher profits and EPS sooner than if production is hedged for several years. The amount of financing needed is relatively small so let's hope a common stock sale happens real soon to get the ball rolling.

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    • Financing complete, No longer selling silver stream for 3.90/oz! gla

    • Usually when smaller mines float shares what happens is they get ripped off by the banks....if at all possible would rather they used the profit they are now making to finance the shaftner...even if it took a couple years to do it....I am willing to wait...silver/gold has a number of years to run yet....

      thank you for listening to my thoughts....sno

      • 1 Reply to sno13390
      • I believe management has the following options to raise the $40 million or so to put Shafter into production:
        a. finance Shafter through current operation.
        b. sell stock to raise the funds
        c. take in a partner to help finance Shafter
        d. borrow funds
        e. sell future production to Silver Wheaton or another money outfit
        I believe "a" and "e" would delay profits growth for another four or more years. Shafter production (clear of the hedge) could miss the entire silver bull cycle. I believe "c" would permanently reduce profits for Aurcana shareholders. I believe a combination of "b" and "d" is the best bet for stockholders as this combined funding could get the project moving soon and it would minimize the time until great earning growth per share are being realized. I see the peak for silver prices to happen in mid 2012 so I believe the clock is ticking. The debt from "d" could be paid back quickly and whatever dilution comes from "b" would at least be offset by the rapid transition to production and clear profits realization.

 
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