ZURICH – Western Europe’s gold aficionados are almost as eager about accumulating silver.
“Germans, Swiss Germans, some Italians, they love their silver,” says Bob Archer, CEO and founder of Great Panther Silver (TSX: T.GPR, Stock Forum and AMEX: GPL).
It’s because Europeans, not their banks mind you, are frugal. The rich might live in hoary old castles, but they rarely don the garb of barons and earls. Europe’s metals investors cherish their sacks of silver coins, their blunderbusses and suits of tin-foil armour.
Later this week, Great Panther will be displaying its plata (silver in Spanish) at the Munich Metals Show. A kind of PDAC Europa, the two-day November-fest also goes by the name Edelmetallmesse Munich.
Some North American miners and prospectors time their European road shows with Munich’s crisp autumn days and early sunsets. Great Panther’s next-door Guanajuato neighbour, Brad Cooke’s Endeavour Silver (NYSE: EXK and TSX: T.EDR, Stock Forum), will be touring European capital cities at the same time. (Photo: Brad Cooke tells the story of La Luz outcrop at Guanajuato – Thom Calandra photo)
The tour I am on, led by Zimtu Capital’s portfolio of private and public metals prospectors, is crisscrossing Switzerland, Germany and Austria in a big sporty bus. (Please see tour stops.)
I am at ease in Europe, having spent four years here in the 1990s as a company builder. I got rich in London by investing in biotech and digesting Internet business models.
These days, I’m getting rich on 11 years of Edelmetallmesse hoarding.
Silver surge in hillside town
In the hillside town of Guanajuato, Mexico, last week, after I viewed Great Panther and Endeavour Silver’s production and exploration operations for a second time in three years, Endeavour’s corporate development chief, shiny-head silver historian Hugh Clarke, gave my 12-year-old a one-ounce company coin. He flipped the frau one for her older brother.
She wanted them both, but then so did I. I like multiples and want to see both companies combine for the sake of the Mexico silver industry and for the benefit of shareholders.
One week after returning from Mexico, the Endeavour silver coins are worth $35 each, up from $31. The two companies’ Canada and USA-traded shares are trending higher, too.
Great Panther, often mentioned in the same breath as Endeavour these days of what I think will be Mexico’s thinning of its corporate silver ranks in coming months, also gave out one-ouncers. The chintzy Europeans in their drafty castles and cobwebbed turrets would have liked Great Panther’s square bars: you can break them into fours, a regular slab of Swiss chocolate for Mexican money picnics.
“Not too shabby,” says Great Panther’s spanking new Guanajuato mine general manager, Graham Parsons, “when silver gets back to new highs, you split ‘em apart.” For food, drink and if silver gets dear enough, to purchase $80 ski passes, I think. Mr. Parsons, a Briton, hails from Cornwall and studied geology and such not far from Nottingham. They have castles there.
Graham Parsons must become a Robin Hood in engineer’s cloth. Regarding mine development, he must lead Great Panther’s drill rigs to the richest veins, then distribute ore from blasters to the circuits of a 600-tonne-per-day mill, hungry for more rock at something shy of two-thirds capacity.
If Graham does that, the poor yet hardy mill will be rich again. (Photo: Mr. Parsons at left, and Mr. Archer at Guanajuato. – Thom Calandra photo)
“Our big drop in production (earlier this year) came because of lower grades at Guanajuato,” says Great Panther’s Charles Brown, chief operating officer. “But now, Graham has the best of our Cava Clata to mine … and an expanding Santa Margarita resource.”
Mr. Archer, who resembles kindly King Richard to tall Mr. Cooke’s not-so Little John, says he is on a crusade to resume rapid growth here and at the Topia camp much farther north in Durango state. Great Panther’s San Ignacio holding, adjacent to Endeavour’s lustrous Golondrinas and Asuncion properties, themselves gold rich in their crazy-high-grade silver ore, offers stately upside if Mr. Parsons narrows his targets among these slippery bugger veins.
Later this year, for those Europeans anticipating royal surprises from both companies, we entertain possibilities:
- that Great Panther will “move” a whack of its 500 tonnes of stockpiled ore, lying fallow right now because of a smelter back-up, to delivery and into the fourth-quarter income – although how much of it is mystery X in this valuation equation;
- that Endeavour next year will fulfill soft projections from executives and miners that an expanded, 1,600-tonne-per-day Guanajuato mill at Bolanitos will get fresh ore from the likes of Asuncion and various attendant veins, those coyly named Karina and La Jolla.
Neither of those two scenarios, if they occur, is priced into the two silver equities.
The other day, I saw some as-yet unreported Endeavour core, along with a gaggle of North American men and women. Endeavour’s core shed, with some $12 million of assayed product, sits just above the Guanajuato region’s Veta Madre, or mother of all veins.
Think ziggy-zaggy quartz and banded ceracite core: tan-hued rock with sure signs of gold jacked into the silver.
As for my combo crusade, both Mr. Cooke and Mr. Archer stick to their chivalrous tale that no merger, not even preliminary talks between the two companies, has been entered into the scrolls of their kingdoms.
Yet I say nay, loudly nay: my gold-tipped silver crusade is not yet finished. I know a few barons and earls in Bavaria who wait for the day when their favored two Mexico silver miners are that much closer to reaching 10-million-yearly-ounces (silver equivalent), say, by 2013.
Went & Did It: Yes I did. Our Truth Serum Workshop lured many of the stalwart late-evening New Orleans attendees who attended my image-laden General Session. Scores of free subscribers from our Stockhouse-published twice-weekly research reports got an offer they surely would never get in Nottingham, Sherwood Forest, the Tower of London or the kinky back-streets of Munich and Vienna. They got four of my best candidates for outsized returns the next six months, two in gems and two in metals. (Three of the four are listed below.)
EUROPE ON LE BUS: This week, I am accompanying a group of miners, prospectors, professors and promoters across several European cities. The Zimtu road show on a bus is making its way to the Munich Gold Show and visiting Hamburg, Zurich (today), Geneva and Vienna. A lot of dark-suits are getting a look at potash, uranium, graphite, rare earth and other Zimtu holdings. If you’d like to know more, grab a brioche, or enjoy a free lunch, cocktails and an overview of the metals marketplace, please visit: http://roadtrip.zimtu.com/. The sponsor is Zimtu Capital (TSX: V.ZC, Stock Forum) and seven of its portfolio companies. To register: click here – it is free. Come see us.
NOTES: I am a partner of investor outreach firm Torrey Hills Capital in Del Mar, near San Diego, California. Great Panther in the article above is a Torrey Hills client. Please see recent coverage.
Stockhouse members – the service is free – can see my entire portfolio online. It is under the portfolio function and my user name, which is TCALANDRA. Aside from Central Fund of Canada (TSX: T.CEF.A, Stock Forum), there is little to nothing in my portfolio suitable for risk-averse investors. I am not a financial adviser or planner. In this article, I am a shareholder of Endeavour Silver and Great Panther Silver; oh, three of those four? Stellar Diamonds on London’s AIM; True North Gems in a ruby-laced Canada listing; and Buccaneer Gold, also listed in Canada but active in Ghana. I own ‘em.
More on Thom Calandra
Subscribe to Stockhouse’s Exclusive Financial Newsletter – Ticker Trax. Only $99
Make more informed investment decisions through collective intelligence.
Headed by Danny Deadlock, Senior Editor.
