Silver Wheaton Corporation: Another Quality Acquisition
Friday, February 12, 2010 at 02:46PM
Silver Prices in Silver Mining Companies
SLW Logo 03 jun 09.JPG

Silver Wheaton Corporation (SLW) has announced announce that it has agreed to acquire an amount equal to 100% of the life of mine silver and gold production from Augusta Resource Corporation's (TSX, NYSE Amex: AZC) Rosemont Copper Project located in Pima County, Arizona. Rosemont is forecast to be a low-cost, long-life and large-scale copper-molybdenum-silver project that could account for approximately 10% of US copper output once in production, projected by 2012, another good move in our humble opinion.

Silver Wheaton will pay Augusta upfront cash payments totaling US$230 million to acquire an amount equal to 100% of all payable silver and gold produced from Rosemont, for the lesser of US$3.90 per ounce of silver and US$450 per ounce of gold (both subject to an inflationary adjustment) or the prevailing market price per ounce of silver and gold delivered. The upfront payments will be made on an installment basis to partially fund construction of the mine and will commence once certain milestones are achieved, including the receipt of key permits and securing the necessary financing to complete construction of Rosemont. Augusta anticipates that key operating permits will be received in the fourth quarter of 2010 allowing mine construction to commence shortly thereafter. Silver Wheaton is not required to contribute to further capital or exploration expenditures and Augusta has provided a completion guarantee with certain minimum production criteria required to be met by specific dates.

Peter Barnes, Chief Executive Officer of Silver Wheaton commented as follows:

"We are very pleased to be participating in the development of another low-cost, long-life and high-quality mining project,"

"The Rosemont Copper Project is forecast to increase Silver Wheaton's long term annual production by approximately 2.4 million ounces of silver, plus any gold production, estimated by Augusta to average up to 15,000 ounces per annum. Importantly, our upfront payments will be made only after Augusta has received all the necessary permits to construct and operate the Rosemont mine."

To read the news release in full please click here.

Silver Wheaton Corporation trades on the New York Stock Exchange and the Toronto Stock Exchange under the symbol of SLW and is currently trading at At $15.04 up from $14.38 yesterday registering a one day gain of 4.59%.

Having said 'Buy this Dip' we are pleased to see Silver Wheaton get off to such a good start, lets hope that they can keep it up.

The Company has a market capitalization of $5.13 billion, with 341.28 million shares outstanding, a 52 week trading range of $5.66 to $17.80 with an average volume of 6-7 million shares traded.

All the best.

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