SsMurry Monday, 12/22/14 10:26:31 PM Re: None Post # of 12 Political News have not Impacted Timeline Daniel Earle is providing an update on the El Limon-Guajes project and providing his near-term outlook for the company According to the Mexican attorney general, 43 student teachers participating in a protest in the nearby town of Iguala were abducted by local police in late September and subsequently murdered. While searching for their remains in the area, a number of mass graves were discovered and in the resulting protests a further six people were killed. Authorities believe Iguala's mayor and his wife were behind the atrocity – they subsequently fled, as did the town's police chief. This incident and related protests did blockade the project briefly but have not impacted the project timeline, accordingly to the company; however, these security issues have reportedly made it more difficult to ramp-up the number of contractor employees on site that are required to meet the construction schedule. Should staffing challenges continue, the company suggested that non-critical work for the ramp-up would be postponed to after the first gold pour. Daniel Earle calculates that Torex is currently trading at 1.03x, the corporate NAV5%; this is above both the junior producers and its development-stage peers in the coverage universe, which trade at an average of 0.77x and 0.56x NAV5%, respectively Overall construction of the El Limon-Guajes project was approximately 20% complete (as of September 30) and the project appears to be on schedule for initial production in H2/15. Daniel Earle would suggest, however, that timeline and capex creep occur regularly in the construction of mining projects and particularly ones that are technically challenging (grade/strip ratio risk, metallurgy, topography, etc.), as Daniel Earle believe this one is. These delays and cost overruns are typically disclosed in the later stages of construction, in Daniel Earle's view. Daniel Earle likes the Morelos project. However, before recommending the stock, Daniel Earle would look for either reduced risks via project advancement or a more attractive valuation relative to producers to compensate for the elevated level of risk at the current stage, with commercial production being approximately a year and a half away. Daniel Earle maintains his HOLD recommendation and his target price remains unchanged at $1.75.