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Discovery Silver (OTCPK:DSVS.F) Conference Transcript

2025-12-10 20:47

Summary of Discovery Silver Conference Call Company Overview - **Company**: Discovery Silver - **Key Executives**: Mark Utting (Senior Vice President of Investor Relations), Eric Kallio (Senior Vice President of Exploration and Growth) - **Stock Performance**: Stock price increased from CAD 0.72 at the beginning of the year to just under CAD 8, indicating significant growth potential remaining [4][5][10] Acquisition Details - **Acquisition**: Porcupine Complex from Newmont - **Transaction Value**: CAD 200 million in cash and CAD 75 million in equity, with deferred consideration of CAD 150 million in four equal annual payments starting two years from now [5][6] - **Assets Acquired**: Three operating mines (Hoyle Pond, Borden, Pamour) with potential for at least three new operating gold mines and significant exploration upside [5][6][10] Production and Economic Outlook - **Production Forecast**: Expected production of approximately 220,000 ounces this year, increasing to about 340,000 ounces in the coming years [7] - **NPV Calculation**: Using a gold price of $3,800, the NPV of the technical report was estimated at $4.5 billion, which reflects the current valuation of the company [7][10] - **Cordero Project**: Anticipated to produce about 37 million ounces of silver equivalent over the first 12 years with a 20-year mine life. NPV at $40 silver is just shy of $2.5 billion, and at $60 silver, it could reach $4.5 billion [8][9] Exploration Potential - **Dome Mine**: Contains an inferred resource of 11 million ounces, with plans to bring it back into production. Historical production was 17 million ounces since 1910 [10][11] - **Exploration Program**: Aiming for over 200,000 meters of drilling next year, with positive results reported from various locations including Hoyle Pond, Borden, and Pamour [42][43] - **Geological Insights**: The Timmins area is part of the Abitibi Greenstone Belt, known for significant gold deposits. The geology includes various formations and structures conducive to gold mining [46][49] Financial Position - **Cash Reserves**: Company reported cash of $342 million at the end of September, with no outstanding debt [23] - **Liquidity**: Completed a revolving credit facility providing an additional $250 million of liquidity [23] Infrastructure and Operational Plans - **Dome Mill Expansion**: Plans to increase milling capacity from 12,000 tons per day to 30,000 tons per day, which would significantly enhance production capabilities [89][90] - **Cost Reduction**: Potential to reduce processing costs by $5-$10 per ton by optimizing existing infrastructure [88] Regulatory and Permitting Updates - **Cordero Project Permitting**: Increased confidence in obtaining environmental impact assessment approval in the near future, which is critical for advancing the project [9] Conclusion - **Investment Thesis**: Discovery Silver presents a compelling growth story in both the gold and silver industries, with significant upside potential from existing assets and exploration opportunities. The company is well-positioned financially to capitalize on these opportunities and drive future growth [4][10][23]