I see a lot of hype with this purchase and I am by no means an expert on silver resources. I have added AVM to my spreadsheet so a comparison can be done against its peers. I did look at the below PEA and the company selling the projects website. I note that they purchased the project for US$750K back in 2021 and have now sold the project for US$520K (A$780K) to AVM.
The prior owners completed the PEA (Scoping Study) in 2023 and one thing I noted was that the true width of the drill holes range between 50% and 70% of the strike length. In AVMs latest announcement I noted that there was one hole that had a 12.5mtr strike length, a couple with 6 to 7mtr but the majority are 5mtr or less. So the vein widths appear to be 1.5mtrs to 5mtrs for the majority of the drill results.
It appears from the second image below that the project has multiple vein system and will be accessed via underground mining. Future surface pit licences are reported to be disallowed in Mexico. Maybe a future change of government will reverse this.
The project is less than 1MT but high grade. It has more than double the grades of ASL and ASL are trading at a significant premium to their peers, so it appears that grade is king. On my spreadsheet, I have deducted the A$780K from cash on hand to get a more realistic comparison. The share prices on my spreadsheet are a few days old, so take them with a grain of salt.
The comparisons are at metal spot prices. When companies quote in silver Eq ozs, most investors do not realise that the different companies use different metal prices to calculate their silver Eq resource. The other thing to note is that when calculating a companies silver Eq oz resource, those companies that are not 100% silver will see their actual resource as measured in silver Eq ozs, drop as silver begins to outperform the companies other metals on a percentage basis. For a Au/Ag resource like AVM, the Au/Ag silver ratio is a good indicator of when silver is outperforming gold. It currently sits at 80, and i am expecting it to hit low 50's by the end of 2025.
In a nutshell, AVMs reported silver Eq resource differs to mine because they used a lower silver and gold price to calculate the resource whereas my resources are using yesterday's spot prices.
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