- Published: 10 November 2008
- Written by Editor
Silver Bear Announces Additional High Grade Results from 2008 Drill Program at Mangazeisky, Third Quarter Financial Results
- A total of 80 holes (12,930 metres) have been completed as of October 31, 2008, with assay results returned for 52 holes.
Highlights from the 32 most recent - Hole V08-063 returned 1,639 grams per tonne of silver over a 5.6 metre interval;
- Hole V08-037A returned 824 grams per tonne of silver over a 4.8 metre interval;
- Hole V08-066 returned 667 grams per tonne silver over a 8.8 metre interval;
- Hole V08-047 returned 640 grams per tonne silver over a 4.3 metre interval;
- Hole V08-062 returned 502 grams per tonne silver over a 3.9 metre interval
Silver Bear Resources Inc. ("Silver Bear" or the "Company") (TSX:SBR) today announced further positive results from exploration drilling at its 100% owned Mangazeisky silver project, its strong liquidity position and financial results for the three and nine-month period ended September 30, 2008. All dollar amounts are in Canadian dollars unless otherwise stated.
"We are very pleased to announce continued high-grade exploration results at Mangazeisky that further support the vast potential of the project. Silver Bear remains well financed and we will continue to explore Mangazeisky in 2009," said Mr. Randall Oliphant, President and Chief Executive Officer.
In addition to the positive drill results during the quarter, the arbitration case with the Federal Tax Service, discussed in the Company's second quarter results, concluded on September 14th with the court's August 12, 2008 decision, in favour of Silver Bear, being upheld as the Federal Tax Service did not file an appeal by the requisite due date. The Company has received confirmation from the court that this matter has been dismissed.
<<
Outlook - Mangazeisky Project
-----------------------------
Key milestones for Silver Bear:
- Exploration will continue on the known extensions of the Vertikalny
vein to demonstrate a potential of 200 to 250 million ounces of
silver(1).
- Results of the Company's exploration program will be summarized in an
NI 43-101 Technical Report due in Q1 2009.
- Complete 10,000 metres of exploration drilling during the 2009 field
season compared to previous plan of 40,000 metres.
>>
Silver Bear will continue to explore the Mangazeisky property in 2009. Silver Bear has a strong cash balance of $28.7 million at September 30, 2008, and as a result of current uncertainty in the capital markets has decided to reduce the exploration program planned for 2009 to conserve cash which will allow the Company to continue exploration activities into 2010. The Company has scaled back its drill program to 10,000 metres from 40,000 metres. The Company remains committed to further advancing the project through targeted exploration within the Mangazeisky claim block. Further, the Company is in the process of applying for an extension of its license for an additional five years.
<<
-------------------------------
(1) The reader is cautioned that the targets expressed above and
elsewhere in this press release are based on Silver Bear's assessment
of the geological data currently available and are conceptual in
nature. There has been insufficient exploration with respect to these
targets to define any estimates of quantities. There is no guarantee
that the targeted estimates will be delineated through additional
exploration. These are objectives set by the Company and they are not
estimates of quantities as contemplated by section 2.3 of NI 43-101.
There is no assurance that these objectives will materialize.
THIRD QUARTER FINANCIAL RESULTS
-------------------------------
Liquidity and Capital Resources
-------------------------------
>>
At the start of 2008, Silver Bear had cash and cash equivalents of $30.3 million. On January 18, 2008, the Company raised net proceeds of $1.6 million in relation to the over-allotment option granted by the Company to underwriters in connection with the Company's initial public offering in December 2007. In May 2008, the Company sold its 70% interest in Mine Avlayakan LLC for proceeds of US$8.5 million. On July 16, 2008, the Company completed a private placement with Alfa Group Consortium for net proceeds of $4.2 million. As at September 30, 2008 the Company has invested $3.1 million in property, plant and equipment and had cash expenses of $12.5 million from continuing operations. As at September 30, 2008 cash and cash equivalents were $28.7 million.
Silver Bear is currently budgeting for 2009 with the objective to complete a program in 2009 of 10,000 metres of exploration drilling.
<< Financial Results ----------------- >>
Silver Bear incurred a net loss for the nine month period ended September 30, 2008 of $13.7 million or $0.37 per share, including a $2.5 million gain on the sale of the Avlayakan gold property. This compares to a loss of $10.1 million or $0.43 per share for the nine month period ended September 30, 2007. Exploration costs were $11.9 million in the nine month period ended September 30, 2008 compared with $4.5 million in the nine month period ended September 30, 2007. The Mangazeisky Project accounted for all of the $11.9 million in costs, which primarily related to the 2008 exploration program and costs related to the Company's Yakutsk administrative offices. Exploration expenses increased when compared to the 2007 period since 12,930 meters of diamond drilling was competed in the period ended September 30, 2008 versus 7,199 metres in the period ended September 30, 2007. Rising fuel prices and increased staffing have also contributed to the cost increases. Non-cash stock option compensation expense for the nine month period ended September 30, 2008 was $1.0 million compared with $1.2 million in the nine month period ended September 30, 2007. General and administrative expenses for the nine month period ended September 30, 2008 were $3.2 million compared with $1.7 million in the prior nine month period. The increased general and administrative costs are primarily related to legal fees associated with our Russian litigation, increased investor relations activities and other costs associated with increased staffing in the corporate office.
Silver Bear incurred a net loss for the three month period ended September 30, 2008 of $8.3 million or $0.22 per share. This compares to a loss of $3.7 million or $0.15 per share for the three month period ended September 30, 2007. Exploration costs were $7.2 million in the three month period ended September 30, 2008 compared with $2.1 million in the three month period ended September 30, 2007. The Mangazeisky Project accounted for all of the $7.2 million in costs, which primarily related to the 2008 exploration program and costs related to the Company's Yakutsk administrative offices. The increase in the exploration expenses for the three month period ended September 30, 2008 was a result of increased drilling activity in 2008 versus 2007. Non-cash stock option compensation expense for the three month period ended September 30, 2008 was $0.3 million compared with $0.3 million in the three month period ended September 30, 2007. General and administrative expenses for the three month period ended September 30, 2008 were $0.6 million compared with $0.6 million in the prior three month period.
<< Exploration Update ------------------ >>
Since the September 8, 2008 news release, results have been returned for an additional 32 holes.
Results have been returned for 52 holes to date, representing approximately 65% of the total drilled. Significant results from the 32 most recently assayed holes include:
Hole V08-063 (Profile 10250) returned 1,639 grams per tonne of silver over a 5.6 metre interval, approximately 50 metres below hole V08-040 which returned 1,552 grams per tonne silver over a 4.3 metre interval;
Hole V08-037A (Profile 10650) returned 824 grams per tonne silver over a 4.8 metre interval; approximately 50 metres below hole V08-036 which returned 457 grams per tonne silver over a 0.7 metre interval;
Hole V08-066 (Profile 10550) returned 667 grams per tonne silver over a 8.8 metre interval, approximately 50 metres between hole V07-003 which returned 119 grams of silver per tonne over a 6.8 metre interval and hole V08-032 which returned 362 grams per tonne silver over an 11.4 metre interval;
Hole V08-047 (Profile 10000) returned 640 grams per tonne silver over a 4.3 metre interval, approximately 50 metres below hole V07-002 which returned 30 grams per tonne silver over a 6.1 metre interval;
Hole V08-062 (Profile 9700) returned 502 grams per tonne silver over a 3.9 metre interval, approximately 100 metres below hole V07-013 which returned 596 grams per tonne silver over a 4.4 metre interval;
Hole V08-064 (Profile 10550) returned 342 grams per tonne silver over a 6.3 metre interval, approximately 50 metres between hole V08-029 which returned 998 grams per tonne silver over a 4.7 metre interval and hole V08-031 which returned 1,739 grams of silver per tonne over a 2.8 metre interval;
Holes V08-064 and V08-066 confirm the previously interpreted presence of a high grade lens measuring approximately 200 metres along strike and 200 metres down dip which averages 743 grams per tonne silver over an average horizontal thickness of 2.7 metres. This zone is structurally offset to the northwest where surface mapping has successfully identified the extension of the Vertikalny zone.
Trenching operations commenced once the diamond drilling program was completed. Surface trenching at Mangazeisky is more effective in the fall and winter months as the trenches fill with groundwater generated from melting permafrost during the summer. A total of 18,389 cubic metres of trenching had been completed as of October 20, 2008. Silver Bear has met the 2008 trenching requirement of its license agreement.
An induced polarity / magnetotelluric resistivity geophysical survey was also completed at Vertikalny. The 16 kilometre survey, completed by Quantec Geoscience, evaluated the geophysical response along the Vertikalny structure over a 2.4 kilometre strike length. Results are currently being evaluated by Quantec Geoscience and an interpretation of the geophysical response will be provided during the fourth quarter of 2008.
Regionally, exploration crews completed 66.8 kilometres of mapping and geochemical sampling at targets within the Mangazeisky License area. Reconnaissance field work focused on tracing the Vertikalny structure to the north west as well as preliminary work to evaluate the Zabytiy target (approximately 5 kilometres north of Vertikalny) and the Kis-Kuelskiy target (25 kilometres southeast of Vertikalny). Both targets are similar in nature to Vertikalny and both returned significant results indicative of favourable mineralization. Exploration in 2009 will focus on establishing surface trenches at both target areas and expanding the geochemical surface sampling.
Refer to our website, www.silverbearresources.com, for a longitudinal section of the drill results.
<<
The following table outlines the results received since our previous
September 8, 2008 release.
-------------------------------------------------------------------------
Hole ID Profile From To Length (m) Silver (g/t)
-------------------------------------------------------------------------
V08-021A 10200 194.8 196.1 1.3 32
-------------------------------------------------------------------------
V08-037A 10650 206.5 211.3 4.8 824
-------------------------------------------------------------------------
V08-038 Not Sampled
-------------------------------------------------------------------------
V08-041A 9900 148.5 153.8 5.3 212
-------------------------------------------------------------------------
V08-042 10250 51.9 54.0 2.1 75
-------------------------------------------------------------------------
V08-044 10100 NSR
-------------------------------------------------------------------------
V08-045 10650 88.0 89.0 1.0 21
-------------------------------------------------------------------------
V08-046 10000 37.2 40.7 3.5 102
-------------------------------------------------------------------------
V08-047 10000 131.1 135.4 4.3 640
-------------------------------------------------------------------------
V08-048 10700 27.5 28.2 0.7 37
-------------------------------------------------------------------------
V08-049 9900 205.3 209.0 3.7 68
-------------------------------------------------------------------------
V08-050 10700 NSR
-------------------------------------------------------------------------
V08-051 9900 110.2 116.5 6.3 360
-------------------------------------------------------------------------
V08-052 9850 94.6 96.4 1.8 190
-------------------------------------------------------------------------
V08-053 9850 144.0 154.2 10.2 38
-------------------------------------------------------------------------
V08-054 10700 129.0 130.7 1.7 11
-------------------------------------------------------------------------
V08-054A 10700 132.6 133.7 1.1 19
-------------------------------------------------------------------------
V08-055 9850 197.0 200.2 3.2 47
-------------------------------------------------------------------------
V08-056 9850 232.0 236.2 4.2 126
-------------------------------------------------------------------------
V08-057 9800 121.3 122.0 0.7 164
-------------------------------------------------------------------------
V08-058 10500 212.0 217.0 5.0 213
-------------------------------------------------------------------------
V08-059 9800 161.5 167.8 6.3 356
-------------------------------------------------------------------------
V08-060 10500 78.9 86.4 7.5 556
-------------------------------------------------------------------------
V08-061 10250 123.3 124.3 1.0 12
-------------------------------------------------------------------------
V08-062 9700 141.1 145.0 3.9 502
-------------------------------------------------------------------------
V08-063 10250 183.3 188.9 5.6 1,639
-------------------------------------------------------------------------
V08-064 10550 15.5 21.8 6.3 342
-------------------------------------------------------------------------
V08-066 10550 110.0 118.8 8.8 667
-------------------------------------------------------------------------
V08-067 10150 NSR
-------------------------------------------------------------------------
V08-068 10150 86.6 88.0 1.4 23
-------------------------------------------------------------------------
V08-069 9600 20.2 21.0 0.8 318
-------------------------------------------------------------------------
V08-070 9550 53.5 57.5 4.0 243
-------------------------------------------------------------------------
NSR: No Significant Results
>>
The results contained herein have been reviewed by Vivian Park, P.Geo., Silver Bear's Qualified Person managing the exploration program on the Mangazeisky Project. Vivian Park is an employee of Silver Bear in the capacity of Director of Exploration.
SAMPLE COLLECTION AND PREPARATION
Silver Bear's core sampling and preparation program is summarized as follows:
All core is 60.3 mm diameter. The core is placed in boxes at the drill site, complete with distance markers. On arrival at the core logging facility, the core boxes are opened and a geologist is responsible for organizing and photographing the core, completing a geotechnical log, and preparing the core for geological logging and sampling.
The core is logged for lithology, structure and mineralization. Intervals of interest are marked for sampling. Intervals deemed to be potentially anomalous in silver are cut using a diamond saw with one half of the core prepared as the sample and the other half retained in the core box and stored at site.
Samples are crushed to a nominal size of -1mm at an on-site preparation facility. A 500 gram split is shipped to the laboratory for pulverization and assay; a duplicate split is retained on site.
All fire assays for silver are completed at the Chemical Laboratory of the State Enterprise Aldangeologiya (Aldan Lab), located in Yakutia, Russia.
Silver Bear's quality control protocol includes the blind submission of certified standards (prepared by Geostats Pty Ltd of Australia), field blanks and field duplicates into the sample stream to monitor the accuracy and precision of the fire assay results.
Geological control samples comprise 15% of the total sample volume. It is standard practice that should the reported results exceed the permissible variance limits ascribed to said standards that the affected batches are re-analyzed. No such occurrences were noted in the results reported above.
An updated drill plan and longitudinal section demonstrating the hole locations is available on the Company's website at www.silverbearresources.com.
<< Silver Bear Resources Inc. -------------------------- >>
The primary business of the Company is the evaluation, acquisition, exploration and development of silver properties in the Russian Federation. The Company's principal asset is its 100% owned Mangazeisky Project, located approximately 400 kilometres north of Yakutsk in the Republic of Sakha, Yakutia in the Russian Federation.
Silver Bear Resources Inc. is listed on the Toronto Stock Exchange and its common shares trade under the symbol "SBR". Silver Bear has 37,935,569 issued and outstanding common shares. Other information relating to Silver Bear is available on SEDAR at www.sedar.com as well as on the Company's web site at www.silverbearresources.com.
Forward-Looking Information
This release and subsequent oral statements made by and on behalf of the Company may contain forward-looking statements, which reflect management's expectations with respect to the proposed transaction. Wherever possible, words such as "intends", "expects", "scheduled", "estimates", "anticipates", "believes" and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Silver Bear cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. Such risks factors include but are not limited to risks factors identified by Silver Bear in its continuous disclosure filings filed from time to time on SEDAR. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause Silver Bear's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although Silver Bear has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date of this release, and Silver Bear assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.
<<
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Balance Sheet
(Canadian dollars)
(unaudited)
September 30, December 31,
-------------- -------------
2008 2007
Assets $ $
Current assets
Cash and cash equivalents 28,669,371 30,295,581
Related party receivable 19,268 31,052
Non-controlling interest - 151,592
Inventories 1,553,628 628,196
Prepaid expenses 1,221,764 2,305,284
Miscellaneous receivables 36,913 50,232
-------------- -------------
31,500,944 33,461,937
Capital assets
Mineral properties 1,280,751 959,670
Property, plant and equipment 3,197,129 874,147
Asset held for sale - 5,885,218
-------------- -------------
35,978,824 41,180,972
-------------- -------------
-------------- -------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities
from continuing operations 2,654,518 1,127,478
Accounts payable and accrued liabilities
from discontinued operations - 200,265
-------------- -------------
2,654,518 1,327,743
-------------- -------------
Long-term liabilities
Asset retirement obligation 577,814 245,360
Non-controlling interest - 127
Shareholders' equity
Capital Stock 73,771,289 67,991,311
Warrants - 273,575
Contributed surplus 8,130,419 6,835,085
Deficit (49,155,216) (35,492,229)
-------------- -------------
32,746,492 39,607,742
-------------- -------------
-------------- -------------
35,978,824 41,180,972
-------------- -------------
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Operations and Comprehensive Loss and Deficit
(Canadian dollars)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- --------------------------
2008 2007 2008 2007
$ $ $ $
Income
Interest income 137,914 56,946 603,308 152,268
------------- ------------- ------------- -------------
Expenses
Exploration costs 7,206,937 2,126,903 11,851,297 4,507,861
Stock option
compensation 292,302 262,406 1,021,759 1,202,077
Amortization 195,111 243,087 732,502 712,923
General and
administrative 603,169 555,298 3,230,726 1,676,744
Penalty shares - - - 647,233
Foreign exchange
loss (gain) 151,493 34,979 (46,159) 164,482
Accretion expense 3,794 - 11,376 -
Gain on disposal
of property,
plant and
equipment - (11,035) - (11,035)
------------- ------------- ------------- -------------
Expenses from con-
tinued operations 8,452,806 3,211,638 16,801,500 8,900,285
------------- ------------- ------------- -------------
Non-controlling
interest - (409,441) (33,179) (665,686)
Loss and Comp-
rehensive Loss for
the period from con-
tinued operations (8,314,892) (2,745,251) (16,165,014) (8,082,331)
Discontinued
operations - (987,512) 2,502,027 (2,029,231)
------------- ------------- ------------- -------------
Net Loss and comp-
rehensive loss (8,314,892) (3,732,762) (13,662,987) (10,111,561)
------------- ------------- ------------- -------------
Deficit - Beginning
of the period (40,840,324) (29,010,033) (35,492,229) (22,631,234)
------------- ------------- ------------- -------------
Deficit - End of
the period (49,155,216) (32,742,795) (49,155,216) (32,742,795)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Weighted average
number of common
shares outstanding 37,066,717 25,591,014 36,841,555 23,823,991
Loss per share from
continued
operations $ (0.22) $ (0.11) $ (0.44) $ (0.34)
Loss per share from
discontinued
operations - (0.04) 0.07 (0.09)
------------- ------------- ------------- -------------
Loss per share $ (0.22) $ (0.15) $ (0.37) $ (0.43)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Cash Flows
(Canadian dollars)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- --------------------------
2008 2007 2008 2007
$ $ $ $
Cash provided by
(used in)
Operating activities
Loss from
Continuing
operations (8,314,892) (2,745,251) (16,165,014) (8,082,331)
Items not affecting
cash:
Amortization 195,111 243,087 732,502 712,923
Accretion expense 3,794 - 11,376 -
Stock option
compensation 292,303 262,406 1,021,759 1,202,077
Penalty shares
issued - - - 647,233
Gain on sale of
property, plant
and equipment - (11,035) - (11,035)
Net change in non-
cash working
capital 778,964 157,706 1,861,823 524,039
------------- ------------- ------------- -------------
Net cash from
continuing
operations (7,044,721) (2,093,087) (12,537,554) (5,007,094)
------------- ------------- ------------- -------------
Financing activities
Issuance of common
shares 4,434,420 - 5,779,977 17,279,568
Non-controlling
interest - - (127) 127
------------- ------------- ------------- -------------
4,434,420 - 5,779,850 17,279,695
------------- ------------- ------------- -------------
Investing activities
Acquisition of
property, plant and
equipment (807,371) (126,813) (3,055,484) (321,190)
Proceeds of sale of
property, plant and
equipment - 21,894 - 21,894
------------- ------------- ------------- -------------
(807,371) (104,919) (3,055,484) (299,296)
------------- ------------- ------------- -------------
Increase (decrease)
in cash and cash
equivalents during
the period (3,417,672) (2,198,006) (9,813,188) 11,973,305
Increase (decrease)
in cash and cash
equivalents during
the period from
discontinued
operations - (1,002,149) 8,186,979 (6,768,823)
Cash and cash
equivalents -
beginning of the
period 32,087,043 10,383,567 30,295,580 1,978,930
------------- ------------- ------------- -------------
Cash and cash
equivalents - end
of the period 28,669,371 7,183,412 28,669,371 7,183,412
------------- ------------- ------------- -------------
>>
SOURCE: Silver Bear Resources Inc.
please visit www.silverbearresources.com, or contact: Raymond Threlkeld, Chief
Operating Officer, (416) 324-6005, This email address is being protected from spambots. You need JavaScript enabled to view it.; Brian Penny,
Chief Financial Officer, (416) 324-6002, This email address is being protected from spambots. You need JavaScript enabled to view it.; Hannes
Portmann, Director, Corporate Development and Investor Relations, (416) 324-6014,
This email address is being protected from spambots. You need JavaScript enabled to view it.
