Avino Silver & Gold Mines Ltd (ASM)

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Avino Silver & Gold Mines Analysis

Avino's news release dated for the 2011 outlook and it's recent sampling release(given below) explain why I bought this company years ago and held on to it. The resources just at the Gonzalos Mine area alone make this company a real winner. The Gonzalos Mine will be going back into production after upgrades in both the mine and the milling operation and exploration of it further at the precise time when silver will be making it's real major advance in price. Avino has many years of reserves on location at the Gonzalos Mine in ground and a large tailings resource just waiting for processing that Wardrop Engineering concluded the oxide tailings held a silver and gold resource with an implied value of US43.7 million and estimated net revenue of $31.4 million. These values were calculated using a silver price of US$8.00 per ounce for silver and $500 per ounce for gold, so today's values will be a lot higher(do the math). This company has it all and has weathered the manipulated collapse of both silver and gold prices in previous years by wisely using their time and resources to prepare for this great bull market in the precious metals in the post manipulation period when the true value of the metals will shine through. When full production begins the stock price on this company will come out of the stocks like a race horse and make even it's recent run look small.

http://www.stockwatch.com/News/Item.aspx?bid=U-i0706899-U%3aASGMF-20110111&symbol=ASGMF®ion=U

http://www.marketwire.com/press-release/Avino-Provides-Year-End-Summary-and-Outlook-for-2011-TSX-VENTURE-ASM-1373304.htm

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Avino Provides Year End Summary and Outlook for 2011
2010-12-23 08:00 ET - News Release
VANCOUVER, BRITISH COLUMBIA -- (MARKET WIRE) -- 12/23/10

Avino Silver & Gold Mines Ltd. (TSX VENTURE: ASM)(OTCBB: ASGMF)(BERLIN: GV6)(FRANKFURT: GV6) -
Dear Shareholder,
I am pleased to present a review of Avino's achievements in 2010 and outlook for 2011. With precious metals prices at all times highs and continuing to climb, we are working aggressively to bring the San Gonzalo property into production and capitalize on the opportunities presented by the current markets.
Management remains focused on the following key objectives:
1. Complete the San Gonzalo bulk sample program
2. Continue developing the San Gonzalo resource
3. Resume production as quickly as possible
4. Expand resources, reserves and the mines output
5. Identify and explore new targets on Avino's property

The Avino mine was once described by Spaniards as "a mountain of silver." The mine first opened in the 1500s and reportedly supplied considerable wealth to Spain for hundreds of years. It has operated intermittently ever since, including for 27 years under Avino Silver & Gold Mines beginning in 1974. During the three decades that the mine was in production under Avino, silver grades averaged from 3 to 7 ounces per ton with more than 16 Moz of silver, 96,000 oz of gold and 24Mlb of copper produced through both open pit and underground mining. The mine shut down in 2001 due to low silver prices and closure of a key smelter. As metals prices are once again favorable, Avino is working to re-open the mine through exploration and development of high potential zones close in proximity to its 1250 tpd mill.

San Gonzalo zone
The San Gonzalo zone is located 2 km from the original Avino mine and beneath the shallow workings of an old mine from the colonial period. In 2007-08 Avino conducted a 42-hole, 9,204 meter drill program that produced very encouraging results, including 3908 g/t silver and 13.71 g/t gold over 1.45m. In late 2008, Orequest Consultants completed an NI 43-101 resource calculation for San Gonzalo, and estimated the zone contained 4.75 million ounces of silver and 37,300 ounces of gold.

Avino Vein and the Elena Tolosa Zone
The Avino vein served as Avino's primary source of ore during the 27 years of production. The vein is 1.6km long and 60M wide on the surface and has yet to be mined at depth. To date, the deepest level mined was at the 2,070m level (330m below surface). Currently, the company is exploring an area of the Avino Vein called the Elena Tolosa or ET zone that has a target potential of 2Mt with grades historically averaging over 100 g/t silver.

Tailings Resource
We continue to explore options for exploiting the mine's large tailings resource. This asset includes both oxide and sulphide tailings, with each requiring separate treatment methods. In a 2006 study, Wardrop Engineering concluded the oxide tailings held a silver and gold resource with an implied value of US43.7 million and estimated net revenue of $31.4 million. These values were calculated using a silver price of US$8.00 per ounce for silver and $500 per ounce for gold, so today's values will likely be higher. However, our priority at this time is to take a more long-term perspective by first expanding reserves and re-opening the mine.
The company has just completed it's modernization and capacity increase of the milling operation for the mine.

Avino is exploring five high-quality mineral projects in Canada and Mexico. Other than the Avino mine, which is owned 99.28%, all the company's properties are owned 100%. In Mexico, Avino has over 30 years of operating history and long-standing business relationships

Location: Bralorne region, SW British Columbia
Minerals:Gold, silver, zinc
Ownership:100%
Status:Exploration - diamond drilling

Recent History
Avino has held the Minto Property since 1985, when the company conducted geological, geochemical and geophysical surveys as well as trenching. A number of targets were identified, and these were investigated with trenching in 1987. Due to low gold prices, subsequent work was limited until 2006-2007.

Early History
Minto Gold Mines Ltd. mined the property for gold, copper and lead between 1934 and 1940. Historic production was reported as 17,558 ounces of gold (0.20 opt Au recovered grade), 21,327 lbs. of copper and 124,421 lbs. of lead.

Location: Yukon Territory, Canada
Minerals: Silver, Gold, Indium
Ownership: 100%
Status: Exploration

Located in the Keno Hill mining camp north of Whitehorse, the Eagle Property continues to offer exciting potential. In 2009, through an option agreement with Avino, Mega Silver Inc. drilled six holes over 1900 meters. The program successfully identified strong silver, gold, enriched zinc and lead mineralization hosted in the Eagle vein fault (0.3g/t Au, 284.3 g/t Ag, 3.16%Pb, 7.11% Zn. over 1.3m)

The work also established that the rare earth metal indium, used in plasma screens, is present in significant concentrations of up to 285.4 g/t indium (In) over 1.8m. Despite the strong results, Mega Silver returned the property to Avino so it could focus on its Red Lake project in Ontario. Avino is excited about future exploration at the Eagle property, as more work is needed to fully expose the potential for both silver and indium.

The property has produced very high assays for silver since exploration first occurred there in the 1950s. In 1950-51, the vein was exposed by bulldozer trenching. In 1963-64, Jersey Consolidated Mines Ltd. exposed over 120 metres of the vein. An 11.6 metre section, based on 9 chip samples at 1-to-2 metre intervals, reportedly averaged 442.3 g/t silver, 6.5% lead and 3.9% zinc across an average width of 0.46 metres (including a 1.2 metre section averaging 1,570.3 g/t silver across 0.55 metres; cited by: Archer, 1979).

Part of the Historic Keno Hill Mining Camp
The Keno Hill mining camp is one of Canada's most productive for silver, lead and zinc. Between 1920 and 1988, the total reported production was 4,787,423 tonnes with recovered grades of 1.3 kg/t silver, 5.6% lead and 3.1% zinc. Subsequent exploration in the district has led to the discovery of additional large mineral deposits which may become productive in the near future

Parallel to Structures of the Historic Hector-Calumet Mine
The Eagle Vein is located roughly 1.5 kilometres south of, and parallel to, the vein structures of the Hector-Calumet Mine, which generated almost half of all metal produced in the Keno Hill camp from 1935 to 1972. The Eagle vein varies from 0.6 to 4.9 metres in width with mineralized lenses of silver-rich galena, sphalerite and tetrahedrite in a siderite, pyrite and quartz gangue.

Location: Bralorne Region, British Columbia
Area: 662 hectares (1600 acres)
Minerals:Silver, gold
Ownership:100%
Status:Phase II exploration: diamond drilling
Technical Report (PDF. 25 Kb)

The Olympic-Kelvin Property is located on the south side of Carpenter Lake, five kilometres northeast of Goldbridge in the Lillooet Mining Division, British Columbia. The property is easily accessible by all-weather, publicly-maintained roads.

Testing Two Prospective Zones
Drilling began on the Olympic-Kelvin property in January 2004, following up on work completed in 1988 that outlined two prospective areas for gold and silver: Margarita and Enigma. Three diamond drill holes, totaling 480 metres, are planned to test the Margarita Zone, while one diamond drill hole will test the Enigma Zone.

Location:Southern British Columbia, Canada
Area:10 sq. km
Minerals:Silver, gold
Ownership:100%
Status:Phase I exploration: geochemical, sampling proposed
Technical Report (PDF. 26 Kb)

Prospecting on the very large Aumax Property since 1999 has resulted in high-grade silver and gold assays in soil, rock and trench samples. Silver values have ranged as high as 18 oz/ton with gold assays up to .30 oz/ton.

With the probable opening of the nearby Bralorne gold mine in 2004, the possibility exists for custom milling of any ore discovered on the Aumax property.

Proposed Mapping and Soil Sampling
Geological studies conducted late in 2002 concluded that the discoveries to date lie downslope of the mineral source. A subsequent report recommended a Phase 1 program of more prospecting, geological mapping and additional soil sampling to determine the source of the mineralization. Based on the results of this program, Phase 2 exploration would include trenching and possible diamond drilling.

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http://www.stockwatch.com/News/Item.aspx?bid=U-i0706899-U%3aASGMF-20110111&symbol=ASGMF®ion=U

Avino Samples Up to 0.65m of 4576 g/t Ag & 9.09 g/t Au at San Gonzalo
2011-01-11 08:00 ET - News Release
VANCOUVER, BRITISH COLUMBIA -- (MARKET WIRE) -- 01/11/11

Avino Silver & Gold Mines Ltd. (TSX VENTURE: ASM)(OTCBB: ASGMF)(BERLIN: GV6)(FRANKFURT: GV6) (Avino) is pleased to report on further progress from the bulk sampling program at Avino's San Gonzalo mine 85Km North east of Durango, Mexico.
Avino has been developing two stopes 2-080 and 2-140 above the 2260 level. To date approximately 10,000 tonnes have been mined and stockpiled. The mill has been processing development rock from the initial drift along the San Gonzalo vein on the 2260 level but will start on the stockpiled rock from the stopes by the end of this week.