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for SAC and SAC.B shares.
South American Silver Corp. ("SASC") is a growth focused mineral exploration company creating value through the exploration and development of the 100% owned, near-surface, Gold Springs gold-silver project in mining friendly Nevada and Utah in the USA; the advancement of the large scale Escalones copper-gold project in Chile, and realization of just compensation from Bolivia for the expropriation of the Company’s significant silver-indium discovery, Malku Khota.
The Company's approach to business combines the team's track record of world-class discoveries and successful project development and integrates a focus on strong Community Relations and Corporate Social Responsibility.
Management has extensive experience in the global exploration and mining industry with much of that focused in the USA, Chile, Mexico, Bolivia, Peru and Argentina. The Company trades on the Toronto Stock Exchange under the symbol SAC and SAC.B and on the US OTCQX market as SOHAF.
Note, following the closing of the plan of arrangement, the new SAC and SAC.B shares are expected to start trading on the TSX on December 24, 2013.
To The Shareholders:
These are exciting times for the Company, particularly with a stabilizing exploration/mining stock market and rising gold and silver prices, two excellent projects and the financial clout to move forward. With the completion of the Plan of Arrangement, the Company now has an important gold project at Gold Springs in Nevada/Utah with potential for further significant resource expansion through continued drilling and the potential for near-term development. The Company just issued on February 26, an updated resource on the Gold Springs property that shows a meaningful increase in the resource and the quality of the resource, from both the Jumbo and Grey Eagle Targets. The next step for the Company is to complete an internal economic study to help determine if we should proceed along the development curve or continue the exploration phase to further expand the resource. The Company is in a strong financial position and has a strong exploration and development team to meaningfully move the project forward.
The Escalones copper-gold porphyry project in Chile where the Company already has a large announced resource, will be advanced through further analysis of existing data and core and continuation of environmental and permitting activities while we are on the lookout for the right partner. Permitting is proceeding on schedule and the Company expects to have permits in place for the November drill season. The big upside potential at this property includes the very large, undrilled "magnetic body” which is interpreted to be a continuation of the copper-gold skarn drilled to date and the "conductivity anomaly" on the east side of the property which is interpreted as near surface oxide/secondary copper mineralization as seen in drill hole ES 35. The Company believes this property has the potential to host a greatly expanded resource and that it will add significantly to share value.
The Company is moving forward with determination seeking payment for the expropriation by Bolivia of its significant discovery, the Malku Khota silver-indium deposit, through the international arbitration process. To allow shareholders to more clearly invest in either the Company's ongoing exploration/development programs (SAC) or the arbitration with Bolivia, the Company created a Class B share (SAC.B) to which 85% of the net-cash received from any award or settlement will be distributed.
Substantive advances in the arbitration process are expected in 2014 with a major step forward being the expected submittal of the Company's Statement of Claim to the Arbitration Tribunal. Following this there is a long process in which each party can review and disagree with material submitted and submit further clarifying information. At the end of the process there is a formal hearing in front of the arbitrators who decide on the level of compensation
The Company also has the opportunity to seek out mineral properties that would benefit from the "acid chloride leach" technology that it developed for its Malku Khota silver-indium project. This patented technology was successful in extracting multiple metals from mixed ores including precious and base metals, plus indium and gallium. All metals are extracted into a single leach fluid greatly simplifying the process. Now that the Company has the patents in place it has the opportunity to look worldwide for appropriate projects.
As I indicated in my December letter, the Company planned to update the Inferred resource at Gold Springs in the first Quarter. The updated resource was reported on February 26 and as predicted it significantly expanded and more than half of it moved to Measured and Indicated categories. The next step for us is an internal economic study to guide the next steps at the project. Information to date, suggests that the project is likely heap leachable. This type of operation can have low operating costs and low capex, potentially making Gold Springs an excellent development opportunity in the near term.
At Escalones, drilling in 2013, as well as metallurgical testing clearly showed that the project is moving along the "knowledge curve" in a very positive way. The resource was updated, expanding the earlier resource estimate by nearly 50% with a significant portion of the resource moving to the "Indicated category". Also, tantalizing results from diamond drill hole ES-43 (email@example.com g/t gold) suggest there may be potential for a gold-only skarn above the copper-gold skarn at the project. Existing core will be tested for this possibility in 2014. Metallurgical testing confirmed good copper-gold extractions and the potential to produce good grade, clean concentrates.
The Company is now well positioned to create shareholder value with a strong exploration team, sufficient capital and a highly prospective gold property at Gold Springs, Nevada/Utah and very large porphyry copper-gold project at Escalones in Chile.
I look forward to your continued support.