Kuya Silver Corp Stock
In 2020 this junior Silver miner acquired a previously producing mine.
The Bethania mine was privately owned by a family that mined just enough metal to provide them with a comfortable income stream. They never explored the property thoroughly because they didn’t have to. High-grade Silver veins were discovered early in this property’s history and all the private owners did from that point forward is mine the valuable ore and truck it to a processing plant.
Kuya Silver now has 100% ownership of the Bethania mine and the company is targeting commercial production in 2022.
Instead of continuing with the toll-milling business model (mine high-grade ore and truck to mill), Kuya is building an on-site processing plant that will eliminate the cost of transporting ore to a mill.
KUYAF is also aggressively exploring their land package using modern techniques. With Dr. Quinton Hennigh providing technical direction, this effort is likely to result in NI 43-101 compliant reserves fairly quickly.
As of late-2020 Kuya was in the process of acquiring its second property. Finalizing this acquisition will provide an additional catalyst for KUYAF share price going forward.
Bottom line: in Kuya Silver with have a dynamic growth story which has been significantly de-risked through its acquisition of a previously-producing Silver mine and land package which has never been explored using modern prospecting techniques.
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Junior Silver Miners
Junior Silver miners are one of the ‘aggressive growth’ elements of a Precious metals Mining stock portfolio.
The micro-cap (under $300 million) mining companies have multiple potential price catalysts in the current secular bull market in Silver and Gold:
- Organic growth through development of existing assets (drill results, feasibility studies, NI 43-101 reports, etc.) and the acquisition of new prospective properties.
- Rising Silver prices which dramatically increase free cash flow. The cost of mining is relatively fixed so the increase in bullion prices is almost pure profit.
- Depleted reserves of the major Silver producers. The major miners have been reluctant to replace their reserves because they over-invested at the end of the 1999-2011 bull market and got burned. Now these large miners will have to pay a premium to acquire the best assets from the junior mining companies.
These catalysts, acting together, could drive the price of physical Silver and Silver mining stocks dramatically higher.
Well-run mining companies in control of economically-viable mineral deposits are likely to leverage rising Silver prices by a factor of 2 or 3. That estimate is based on the historic performance of precious metals mining stocks relative to the price of the underlying metal.
Junior miners are inherently risky. Think of them as burning matches that are exiting to be involved with for a little while, but hold them too long and an Investor is likely to get burned.
As conservative Investors we want to have exposure to Gold and Silver stocks but we also want to minimize risk as much as possible.
We can accomplish these competing objectives with a company like Kuya Silver.