Report on Zinc Mining, Related Equilibrium in Pricing and Silver-Zinc Harmony;

 Abridged Version - February 14, 2007

  Content found herein is not investment advise see Terms of Use, Disclosure & Disclaimer

Silver-Zinc Mines offer Robust Returns

Zinc commonly has a substantive accompanying precious metal or base metal concentration in the ore mineralization of highly profitable zinc miners. Although Silver-Zinc miners look to silver as a secondary consideration, given the meteoric rise of silver in the last few years these Silver-Zinc mines provide commodity diversification and yields that appeal to investors. Examples of such mines seen in the section below entitled "Notable Zinc Mining Participants" include (but are not limited to) BHP Bilton, Lundin Mining Corp, Impact Silver Corp, Agnico Eagle (Laronde II Mine), Appollo Gold (Montana Tunnel Mine), Pan American Silver (San Vincente), Silver Corp (Ying Silver Project). Also see "Investment Alert/Special Situation Advisory" section for restart of Silver-Zinc mine and related undervalued opportunity and metrics.

  

Investment Alert/Special Situation Advisory: In light of the exceptional margins afforded producing zinc mines (many with accompanying metals as a bonus), investors would do well to look at Abcourt Mines Inc. (TSX Venture Exchange: ABI chart). ABI will reopen their 100% owned Abcourt-Barvue Zinc-Silver mine. Production was put on hold in 1990 when silver prices were falling and there was an anticipated drop in the price of zinc. The equipment was mothballed for a timely reemergence and it appears the necessary right determining steps and requirements are now in place for a highly profitable operation. A current review of Abcourt Mines Inc. is available at http://miningmarketwatch.net/abi.htm and a brief overview is made available in the case study section below.   Abcourt Mines Inc. has 750 Million lbs Zinc, 21 Million Oz Silver, 220k Oz Gold (43-101 measured and indicated resources on most numbers), only 43 Million shares outstanding and is trading under a mere Canadian dollar. ABI.V appears grossly undervalued with current disproportionate multiples as inherit resource and infrastructure value per share is well in excess of the current trading price (over $37 USD/share in ground value). The Abcourt silver-zinc mine in the first year alone will be on the order of 1,800 metric tons per day grading 3.08% zinc (resulting in approx. 54.7 pounds zinc/tonne produced = 35.5 million payable pounds zinc annually) and 56.4 g/t silver (resulting in 1.5 oz silver/tonne produced = 975,000 oz silver payable annually), less mining and processing costs, with zinc at $1.40, they should be conservatively netting approx. $28M USD/annum income from operations (EBITBA). That is 58 cents USD/fully diluted share from the zinc-silver mine alone in year one... now consider the stock is currently well under a $1/share. (Short Cut to the full ABI Story).   CASE STUDY: Abcourt Mines Inc. (TSX-V: ABI) offers insight and opportunity for investors on their reopening of their Abcourt-Barvue Silver-Zinc Mine.  Excerpt from February Mining MarketWatch Review of Abcourt Mines Inc.   “The Easiest and Smartest Long Call of 2007;  Abcourt Mines Inc. (TSXV: ABI)” 750 Million lbs Zinc, 21 Million Oz Silver, 220k Oz Gold Abcourt Mines Inc. is a TSX Venture Exchange listed advanced stage development and exploration mining company (ticker symbol ABI.V, also listed in Frankfurt). Abcourt has come to our attention due, in part, to the extraordinary opportunity afforded investors as it approaches becoming a silver and zinc producer from their Abcourt-Barvue open-cast operations in Val-d'Or, Quebec.   ABI will reopen their 100% owned Abcourt-Barvue Zinc-Silver mine. Production was put on hold in 1990 when silver prices were falling and there was an anticipated drop in the price of zinc. The equipment was mothballed for a timely reemergence and it appears the necessary right determining steps and requirements are now in place for a highly profitable operation. The company is debt free and has managed to maintain and upgrade their properties, equipment, and resources during the hiatus all without diluting the share structure.   Abcourt's other prize asset is their 100% interest in the past producing (1947 - 1966) Elder gold mine located 60 miles from their silver zinc project in Northwestern Quebec. Abcourt recently completed a 7000 meter, 40 hole drill program on this Elder gold property that will increase existing resources. Initial results are extremely encouraging. Similarly to the Abcourt-Barvue mine, Elder gold mine has a substantial amount of well maintained and upgraded infrastructure in place. The geological model the Company believes in for the Elder gold property, holds the potential for 1.5M tones of ore grading approx. 0.2 oz of gold per ton. The initial proceeds from the Abcourt-Barvue Zinc-Silver mine operation will finance the reopening of the Elder gold mine. Additionally Abcourt has exercised an Option to acquire 100% of the Aldermac deposit near Rouyn-Noranda, Quebec. The Aldermac is a past producing mine (1936-1943) and offers great potential for future exploration ...   Abcourt's key properties are located along Quebec's Cadillac Fault in the prolific Val D'Or (Valley of Gold) District of Quebec. Val D'Or is in the hub of mining in Eastern Canada. The Val D'Or district, with the exception of Nevada, is considered by many industry professionals as the most mining-friendly district in North America. The Province of Quebec is judicially expedient in facilitating mining permits and provides colossal tax incentives for exploration and tax concessions for off-periods. Abcourt is the beneficiary of such exploration tax credits and concessions; having taken advantage of exploration incentives (35 cents credit for every $1 spent) and been allowed a tax-loss carry-forward (from when they mothballed operations in 1990 until present) that may be credited towards profits when they reopen - several millions will be added to the bottom line in Abcourt's case.   Several large mining players are in the vicinity of Abcourt. Either producing or developing miners in this mineral rich area include the likes of Agnico Eagle, IAMGold, Richmont, Breakwater and Xstrata. The presence of these majors in the near vicinity to Abcourt, with it's ever increasing NI-43-101 resources of significance, leads Mining MarketWatch to can't help but speculate on the appeal ABI.V makes as a buy-out candidate. Regardless, there is ample milling and smelting capacity in the region that will make transportation costs minimal, whether by Abcourt or other.   ...Full Copy from Source

Notable Zinc Mining Participants

Explorers and producers that are charged with bringing zinc and accompanying metals to market now and in the future are offering equity investors the ability to capitalize on favorable zinc prices by acquiring their underlying security.
 
Producing zinc mines that were able to hang in there through the bear market are able to bring their zinc to market at exceptional margins now. Resilient zinc miners that were making profits at $0.35/lb zinc and that are leveraged to the price action of their underlying metal are able to achieve handsome profits in today’s environment.

We have cataloged all notable companies with current or soon producing zinc mines. The associated links in the full version of this report have expanded profiles on each company:

ABCOURT MINES INC., AGNICO-EAGLE MINES LIMITED, ANGLO AMERICAN PLC, APOLLO GOLD CORPORATION, BARRICK GOLD CORPORATION, BHP BILLITON, BOLIDEN AB (PUBL), BREAKWATER RESOURCES LTD., CALLINAN MINES LTD., CAPSTONE MINING CORP., CASTROVIRREYNA COMPANIA MINERA S.A., CBH RESOURCES LIMITED, CIA. MINERA CAUDALOSA S.A., COEUR D ALENE MINES CORP, COMPANIA DE MINAS BUENAVENTURA S.A.A., COMPANIA MINERA ANTAMINA S.A., COMPANIA MINERA ARGENTUM S.A., COMPANIA MINERA ATACOCHA S.A., COMPANIA MINERA CONDESA S.A., COMPANIA MINERA CONDESTABLE S.A.A., COMPANIA MINERA MILPO S.A., COMPANIA MINERA RAURA S.A.,

COMPANIA MINERA SAN IGNACIO DEMOROCOCHA S.A., COMPANIA MINERA SANTA LUISA S.A., DIA BRAS EXPLORATION INC., DOE RUN COMPANY, ECU SILVER MINING INC., EMPRESA MINERA LOS QUENUALES S.A., EUROPEAN GOLDFIELDS LIMITED, EXXARO RESOURCES LIMITED, GOLDCORP INC., GREAT PANTHER RESOURCES LIMITED, GRIFFIN MINING LTD, GRUPO BACIS, S.A. DE C.V., GRUPO MEXICO S.A.B. DE C.V., HECLA MINING CO, HUDBAY MINERALS INC., IMPACT SILVER CORP., INDUSTRIAS PENOLES S.A. DE C.V., INMET MINING CORPORATION, KAGARA ZINC LTD, KAZAKHMYS PLC, LP HOLDING S.A., LUNDIN MINING CORPORATION,

METALINE CONTACT MINES, MINAS ARIRAHUA S.A. (MINARSA), NEW OROPERU RESOURCES INC., OXIANA LIMITED, PAN AMERICAN SILVER CORP., PAN AMERICAN SILVER S.A.C. MINA QUIRUVILCA, PERILYA LTD, PERU COPPER INC., PERUBAR S.A., PLATA PANAMERICANA S.A DE C.V., RIO TINTO, ROYALCO RESOURCES LIMITED, SILVERCORP METALS INC., SOCIEDAD CONTRACTUAL MINERA EL TOQUI, SOCIEDAD MINERA, CORONA S.A., SOCIEDAD MINERA EL BROCAL S.A.A., SOUTHERN COPPER CORP, TECK COMINCO LIMITED, VEDANTA RESOURCES PLC, VOLCAN COMPANIA MINERA S.A.A., XSTRATA PLC, ZINIFEX LIMITED

Zinc Fact: The composition of a US penny was changed in 1982 because the value of the copper in the coin started to rise above one cent. In 1982 cents use the 97.5% zinc composition.

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Disclaimer & Disclosure: The information contained herein is believed to be accurate but this cannot be guaranteed. The analysis does not purport to be a complete study of securities and issues mentioned herein, and readers are advised to discuss any related purchase or sale decisions with a registered securities broker. Companies mentioned herein may be very early stages of development and thus can therefore be subject to business failure, and are to be considered speculative and high risk in nature. Reports herein are for information purposes and are not solicitations to buy or sell any of the securities mentioned. The author may or may not hold a position (long or short) in the securities mentioned herein. This is a journalistic article and the author is not a registered securities advisor, and opinions expressed should not be considered as investment advice to buy or sell securities, but rather opinion only. The publisher may make take journalistic liberties employing the use of pseudonyms as reference contacts and accepting information at face value from what it believes to be credible sources. Further disclaimer and disclosure regarding various aspects of this report / article including compensation and other points may be seen at http://www.madisonaveresearch.com/disclaimer.htm.