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Wednesday, 06/20/2018 10:34:07 AM

Wednesday, June 20, 2018 10:34:07 AM

Post# of 1395

From the Silver Bull board at StockHouse (TSXV:SVB; OTCQB:SVBL)

Posted by blue0987 6/9/18

South32 JV Option Creates Share Stability, Value, & Growth

With South32 agreeing to fund US$10 million/C$13 million of SVB exploration expenses over the next 3-4 years, shareholder dilution due to any equity raises over those years should now be negated, at least for exploration funding, G&A is another matter.

What effect in not having to raise US$10 million/C$13 million for exploration expenses does it save shareholders in not diluting the share count?

Assuming an equity raise through a private placement was for CDN$13 million at a common share price of CDN$0.20, that would equate to an additional 65 million outstanding shares. bringing the total OS from 205 million shares to 270 million shares or a 34% increase in outstanding shares standing.

Also, if we were to assume as in past equity raises, one common share warrant was also attached to the PP, one could add to the fully diluted share count another 65 Million shares, giving a total additional 130 million shares added (65 Million common shares & 65 Million warrants), taking the fully diluted shares from 239 million to 369 million, or a 54% increase in FD shares with an equity raise of C$13 million.

So in optioning 70% of Silver Bull's pie to South32, shareholders receive US$90 million in cash that I believe will be used to cover their share of the costs going forward in growing the sulphide resource, and US$10 million in exploration funding that would conceivably saved shareholders from a 54% increase in share dilution.

From Ron Struthers: "Sierra Mojada already has a 43-101 open pittable oxide deposit containing 90.3 million ounces silver and 4.57 billion pounds of zinc. Judging by all the drilling and channel sampling, it appears the sulphide deposit could end up being much larger and probably have better metallurgy. I am sure it is this potential and the very high grades of silver and zinc that has attracted South32 to commit up to $100 million to get a piece of the action."

What would Silver Bull stock be worth with a high-grade sulphide deposit that contained 5 billion pounds of zinc & 100 million ounces of silver ...... just for starters?

If Analogizing Arizona Mining current resources to that of Silver Bull's future potential sulphide resources stated above, a rough back of the envelope comparison would have Silver Bull's share price coming in at around C$0.65, and this does not include the pittable oxide deposit containing 90.3 million ounces silver and 4.57 billion pounds of zinc, nor the strong cash position obtained from the 70% sale of the company, nor the overall sulphide resource growing much larger than what was stated in the above analogy. GLTA

*****

blue0987
June 19, 2018 - 02:30 AM

It's All About The Size & Grade of the Sulfide Deposit

As most here understand, South32 involvement is not about the oxide deposit, South32 involvement is ALL about the size of the zinc, lead, copper, and silver sulfide deposit that lays underneath the oxide deposits..

South32 whose geo's I can guarantee understand more than anyone on this board, expects the sulfide deposit at Sierra Mojada to equal, and most likely far exceed that of the size & grade of what the current 43-101 oxide deposits contains.

Majors are not looking only for high margin project to buy-out, but just as important, if not more so, long life projects, where LOM exceeds that of 20+ years. The main reasons South32 became involved was that they believe the Sierra Mojada Project to be both high margin & long life.

The $100 million question is for South32 is what size sulphide deposit will the drills at Sierra Mojada uncovered over the next 3-4 years? With South32's funding exploration along with givinig their technical support, we should start seeing through drill results soon enough how lays the sulphide structure underneath the oxide deposit.

I for one would not base current market reaction to wither this deal with South32 is one that can end up bringing instant multiples to the stock price. As the saying goes "The market can remain irrational longer than you can remain solvent", and that goes triple with mining shares.

Everyone here has their own reasons for investing, or not investing, for myself it all comes down to how large, and how high-grade of a sulfide resource does Sierra Mojada actually hold, if it be what South32 geo's believe, I'm a happy shareholder.

Whither I stay or whither I go, only drill results will answer that question. GLTA







Dan

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