Recent quarters have played up the commodities markets. Oil and gold are the celebrities of the sector and moving higher and lower at the whims of the mutual funds and individual commodity bugs. When it comes right down to it, however, who can afford some of these commodities? After all, over $1,000.00 per/oz. for gold or a contract for $80.00 per/bar of oil is a bit pricy for the average investor.
Past posts have discussed “hitting it where they ain’t.” As far as base metals are concerned, consider silver/copper instead of gold. Stock or hard asset is the choice. Hard asset lets an investor know what they have and what it is worth without wondering what a company’s management is up to. Stocks, on the other hand, can move either way on a dime and, if bought at the right price, do very nicely. Either way there is profit opportunity in this area away from the celebrities of gold and oil.
Mines Management Inc., a mineral exploration and development company, works to locate, purchase and develop base metal properties. The company works primarily in the silver sector but also owns zinc-lead and other base metal leases. The company works in the northwestern Montana and western Washington state regions with 2 federally patented sites and over 1,000 unpatented load claims.
Although the company has opportunities with several leases, both patented and load, its primary focus is the permitting and development of the wholly owned Montanore silver-copper project. This silver-copper mining project, located in northwestern Montana, has been following plan and meeting targets. The need to work with the US Forest Service always presents a bit of nervousness but, at present, appears to be progressing nicely as permits are issued and infrastructure and assessment from all permitting agencies continues. It does seem that there is a focus on Nitrate removal in the dewatering process with a solid focus being paid. The process, however, does seem to be under control and progressing with little issue.
Perhaps the largest plus to be found, as the company moves forward, is its cash position and burn rate. The company’s 10-Q indicates a cash balance of just under $18 million and a quarterly developmental cash burn rate of $2 million. Mines Management will need to fund an additional $10 million to complete development plans but also gives a sense of little concern at the moment. In a general sense, this is likely because of a rise in silver prices and overall cost reductions to reduce burn.
The feel of this exploration stage company is that there are some very level headed Montanans and western Washington state people at the helm, in regard to what they are doing when it comes to silver and base metal mining. Gold may be flying, but silver and Mines Management are not too far behind for those interested in the base metal stock play.
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