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Category: Junior: Late Stage Development
Rating: 3.50   (Likely 5 Bagger as of 06/05/2016)
Risk: Moderate
Bear Creek Mining Corp.
www: www.bearcreekmining.com     email: info@bearcreekmining.com

Profile
Notes
Forum
Your Data

Price Data

Symbol Date Price Change 52 Wk Range Volume
CVE:BCM 09/23/2016 CAD 2.900 0.040 3.770 - 0.500 191,814
OTCMKTS:BCEKF 09/23/2016 USD 2.2200 0.0400 2.9000 - 0.3400 105,157
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Don's Summary (from last analysis - 06/05/2016

I loved Bear Creek Mining until June 25, 2011. That was the day the President of Peru did the highly unusual act of revoking the mining rights at their Santa Ana project. He did this because of political pressure from local resistance to the project in Southern Peru. They still have their huge flagship project at Corani (300 million oz at 50 gpt). Corani is on schedule for production around 2019, if they can finance the project ($625 million capex). The first 5 years of annual production will be 13 million oz of silver. Production will then drop to 8-12 million oz for the rest of the mine life (22 years). Currently they are seeking final permits.

Because of base metal offsets (4.5 billion lbs of lead and zinc), the cash costs at Corani are projected below $5, making it a cash cow at higher silver prices. In fact, for the first 5 years, cash costs are supposed to be negative. Even with low cash costs, the after-tax IRR is only 15% at $17 silver. This project needs $20 silver to get financing. In fact, they might have to scale back the size of the mine to get financing.

If they can get Santa Ana back (management thinks this could happen), this could be an exciting company with two large projects heading to production. Santa Ana will take 18 months and $70 million to begin production of 5 million oz annually, if they get their mining rights back. The cash costs at Santa Ana are projected to be about $8 per oz.

It's hard to predict the outcome of Santa Ana, but it really doesn't matter that much. If they are left with only Corani, this stock is a likely 10+ bagger if they get financing and silver prices rise. Also, there is a chance they could get compensation for Santa Ana, which could be used toward financing Corani. This stock has jumped from 48 cents a few months ago to $1.82. I would expect it to continue to follow the silver price up.


7/6/2016: Comments from the company to my questions.

Why did you do a financing?

Our decision to raise money at this time was based on a number of factors. Primarily, we wanted to assure we had the financial wherewithal to get to the finish line on Corani and be in a position to put the project into development. A key component of securing the Construction Permit for Corani is the submission of detailed engineering plans, which are a relatively expensive undertaking, but will be necessary in order to move forward. There are other components of the Corani project that would also be strengthened or secured with a more robust treasury, as we briefly outline in our news release today. We have about 2-3 years of working capital in our treasury now, so were not under any pressure, but the engineering plans would have consumed a good portion of that. So, with recent improvements in the silver price and resulting significant improvements in our share price, a window of opportunity presented itself and we decided to take advantage of raising some money, at relatively low dilution, that will directly go toward meaningfully advancing Corani on the last leg to development.

I thought you only had permitting left?

We do only have permitting left. The engineering plans are a component of the Construction Permit and there is no further feasibility work to be done. I would roughly estimate that the engineering plans will take 8 months, give or take, so we hope receive the Construction Permit in mid-late 2017. On a side note, there are a multitude of permits required to construct and operate a mine - the Construction Permit is the largest one, but there will also be a Water Permit, the ESIA (already approved), a Mine Plan Permit (drawn from the feasibility study, so no new work required for that), and dozens of smaller, fairly inconsequential permits. They are being secured as we speak and will be over the coming months, all in preparation for the Construction Permit application anticipated for next year.

General Details

Financial 06/05/2016
Last
Analysis
Data

Current Data

Change
Item Value Value Updated Value
Mkt. Cap (Fully Diluted): $184.22M $222.53M 06/05/2016 $38.32M
Total Assets: $96.37M $94.11M 06/30/2016 $-2.26M
Total Liabilities: $1.52M $1.92M 06/30/2016 $0.40M
Current Assets: $17.97M $15.72M 06/30/2016 $-2.25M
Current Liabilities: $0.84M $1.24M 06/30/2016 $0.40M
Total Debt: $0.26M $0.00M 06/30/2016 $-0.26M
Cash: $17.78M $15.12M 06/30/2016 $-2.66M
Enterprise Value: $166.70M $207.41M 07/28/1976 $40.72M
Cash Flow: $0.00M $0.00M never $0.00M
Cash Flow Multiple: 0.00 0.00 never 0.00
Net Debt to Cash Flow Ratio: n/a n/a never 0.00
Finance within 1 year: 06/05/2016 n/a
Tax Rate: (guess)  30.00% (default)  30.00% 06/05/2016 0.00%
Misc 06/05/2016
Last
Analysis
Data

Current Data

Change
Item Value Value Updated Value
Share Price: $1.824 $2.203 16:09 on 09/23/2016 $0.38
Shares Outstanding: 93,110,000 93,120,000 06/30/2016 10,000
Shares Fully Diluted: 101,000,000 101,000,000 06/05/2016 0
Company Type: Mostly Silver Mostly Silver never n/a
Production ETA: n/a 06/01/2019 06/05/2016 n/a
Production (Gold Eq Oz.): (guess) 
0
(guess) 
0
06/05/2016 0
Production (Silver Eq Oz.): (guess) 
0
(guess) 
0
06/05/2016 0
Initial CapEx (Outstanding): $625.00M
339.27% of Mkt.Cap
$625.00M
280.86% of Mkt.Cap
06/05/2016 $0.00M
Funding Option: n/a n/a 06/05/2016 n/a
Documentation: none FS 06/05/2016 n/a

Resource Data

GOLD 06/05/2016
Last Analysis
Data

Current Data

Change
Item Value Value Updated Value
O
U
N
C
E
S
T
O
T
A
L
Proven & Probable: n/a n/a 06/05/2016 0.00M
Measured & Indicated: n/a n/a 06/05/2016 0.00M
Inferred: n/a n/a 06/05/2016 0.00M
Reserves & Resources: n/a n/a never 0.00M
P
L
A
U
S
I
B
L
E
Proven & Probable: n/a n/a 06/05/2016 0.00M
Measured & Indicated: n/a n/a 06/05/2016 0.00M
Inferred: n/a n/a 06/05/2016 0.00M
Reserves & Resources: n/a n/a never 0.00M
C
U
R
R
E
N
T
Annual Production: n/a n/a 0oz.
Cash Cost: n/a n/a 06/05/2016 $0.00
Extra Operating Cost: n/a n/a 06/05/2016 $0.00
Average Grade: n/a n/a 06/05/2016 n/a
Recovery Rate: n/a n/a 06/05/2016 0.00%
F
U
T
U
R
E
Proven & Probable: n/a n/a 06/05/2016 0.00M
Annual Production: n/a n/a 06/05/2016 n/a
Cash Cost: n/a n/a 06/05/2016 n/a
Extra Operating Cost: n/a n/a 06/05/2016 n/a
SILVER 06/05/2016
Last Analysis
Data

Current Data

Change
Item Value Value Updated Value
O
U
N
C
E
S
T
O
T
A
L
Proven & Probable: 175.00M 175.00M 06/05/2016 0.00M
Measured & Indicated: 225.00M 225.00M 06/05/2016 0.00M
Inferred: 35.00M 35.00M 06/05/2016 0.00M
Reserves & Resources: 260.00M 260.00M never 0.00M
P
L
A
U
S
I
B
L
E
Proven & Probable: 126.00M 126.00M 06/05/2016 0.00M
Measured & Indicated: 154.80M 154.80M 06/05/2016 0.00M
Inferred: 12.60M 12.60M 06/05/2016 0.00M
Reserves & Resources: 167.40M 167.40M never 0.00M
C
U
R
R
E
N
T
Annual Production: n/a n/a 0oz.
Cash Cost: n/a n/a 06/05/2016 $0.00
Extra Operating Cost: n/a n/a 06/05/2016 $0.00
Average Grade: 50.00 g/t 50.00 g/t 06/05/2016 n/a
Recovery Rate: (CG)  72.00% (CG)  72.00% 06/05/2016 0.00%
F
U
T
U
R
E
Proven & Probable: 200.00M 200.00M 06/05/2016 0.00M
Annual Production: 10,000,000oz. 10,000,000oz. 06/05/2016 0oz.
Cash Cost: $5 $5 06/05/2016 $0
Extra Operating Cost: $10 $10 06/05/2016 $0

Property

Last Analysis Data  (06/05/2016)
Stage Location Name Owned Size (Ha) Type Au Ag Cu Notes
Development Cusco, Peru Corani 100% 5,700 Open Pit show
300 million oz deposit at 50 gpt, plus 4.5 billion lbs of lead and zinc.

10 million oz of silver for 20 years.

Low recovery rate of 65%.

Negative cash costs the first 5 years. $4 per oz the LOM.

$575 capex.

Construction could begin in 2015.
Development Puno, Peru Santa Ana 100% n/a n/a n/a
Exploration Peru Alejandra 0% n/a n/a n/a
Exploration Cusco, Peru La Yegua 100% n/a n/a n/a
Exploration Peru Sumi 0% n/a n/a n/a
Exploration Peru Tassa 100% n/a n/a n/a
Total Land Package Size (ha): 5,700  
Current Data
Stage Location Name Owned Size (Ha) Type Au Ag Cu Notes
Development Cusco, Peru Corani 100% 5,700 Open Pit show
300 million oz deposit at 50 gpt, plus 4.5 billion lbs of lead and zinc.

10 million oz of silver for 20 years.

Low recovery rate of 65%.

Negative cash costs the first 5 years. $4 per oz the LOM.

$575 capex.

Construction could begin in 2015.
Development Puno, Peru Santa Ana 100% n/a n/a n/a
Exploration Peru Alejandra 0% n/a n/a n/a
Exploration Cusco, Peru La Yegua 100% n/a n/a n/a
Exploration Peru Sumi 0% n/a n/a n/a
Exploration Peru Tassa 100% n/a n/a n/a
Total Land Package Size (ha): 5,700  

Profitability (by resource)

Proven &
Probable
06/05/2016
Last Analysis
Data

Current Data

Change
Item Value Value Updated Value
Percentage Gold: n/a n/a n/a 0.00%
Percentage Silver: 100.00% 100.00% n/a 0.00%
Total (Gold Eq. Oz.): n/a n/a n/a 0.27M
Total (Silver Eq. Oz.): 175.00M 175.00M n/a 0.00M
P

L

A

U

S

I

B

L

E
Gold Eq. Oz.: n/a n/a n/a 0.20M
Silver Eq. Oz.: 126.00M 126.00M n/a 0.00M
Maximum Profit (Gold): n/a n/a n/a $0.00M
Maximum Profit (Silver): $122.60M $414.54M n/a $291.94M
Total Maximum Profit: $122.60M $414.54M n/a $291.94M
Max Profit / Current MCap: 0.666 1.863 n/a 1.197
Max Profit Per Share (Gold): n/a n/a n/a $0.00
Max Profit Per Share (Silver): $1.21 $4.10 n/a $2.89
Total Max Profit Per Share: $1.21 $4.10 n/a $2.89
Total Free Profit Per Share: $0.00 $1.20 n/a $1.20
FD Mkt. Cap / Gold Eq.: $111.11 $120.03 n/a $8.91
FD Mkt. Cap / Silver Eq.: $1.46 $1.77 n/a $0.30
FD Mkt. Cap / Per Metal
as % Spot Price:
8.92% 8.97% n/a 0.04%
Measured &
Indicated
06/05/2016
Last Analysis
Data

Current Data

Change
Item Value Value Updated Value
Percentage Gold: n/a n/a n/a 0.00%
Percentage Silver: 100.00% 100.00% n/a 0.00%
Total (Gold Eq. Oz.): n/a n/a n/a 0.35M
Total (Silver Eq. Oz.): 225.00M 225.00M n/a 0.00M
P

L

A

U

S

I

B

L

E
Gold Eq. Oz.: n/a n/a n/a 0.24M
Silver Eq. Oz.: 154.80M 154.80M n/a 0.00M
Maximum Profit (Gold): n/a n/a n/a $0.00M
Maximum Profit (Silver): $150.62M $509.29M n/a $358.67M
Total Maximum Profit: $150.62M $509.29M n/a $358.67M
Max Profit / Current MCap: 0.818 2.289 n/a 1.471
Max Profit Per Share (Gold): n/a n/a n/a $0.00
Max Profit Per Share (Silver): $1.49 $5.04 n/a $3.55
Total Max Profit Per Share: $1.49 $5.04 n/a $3.55
Total Free Profit Per Share: $0.00 $2.14 n/a $2.14
FD Mkt. Cap / Gold Eq.: $90.44 $97.70 n/a $7.26
FD Mkt. Cap / Silver Eq.: $1.19 $1.44 n/a $0.25
FD Mkt. Cap / Per Metal
as % Spot Price:
7.26% 7.30% n/a 0.04%

Reserves &
Resources
06/05/2016
Last Analysis
Data

Current Data

Change
Item Value Value Updated Value
Percentage Gold: n/a n/a n/a 0.00%
Percentage Silver: 100.00% 100.00% n/a 0.00%
Total (Gold Eq. Oz.): n/a n/a n/a 0.40M
Total (Silver Eq. Oz.): 260.00M 260.00M n/a 0.00M
P

L

A

U

S

I

B

L

E
Gold Eq. Oz.: n/a n/a n/a 0.26M
Silver Eq. Oz.: 167.40M 167.40M n/a 0.00M
Maximum Profit (Gold): n/a n/a n/a $0.00M
Maximum Profit (Silver): $162.88M $550.75M n/a $387.87M
Total Maximum Profit: $162.88M $550.75M n/a $387.87M
Max Profit / Current MCap: 0.884 2.475 n/a 1.591
Max Profit Per Share (Gold): n/a n/a n/a $0.00
Max Profit Per Share (Silver): $1.61 $5.45 n/a $3.84
Total Max Profit Per Share: $1.61 $5.45 n/a $3.84
Total Free Profit Per Share: $0.00 $2.55 n/a $2.55
FD Mkt. Cap / Gold Eq.: $83.63 $90.34 n/a $6.71
FD Mkt. Cap / Silver Eq.: $1.10 $1.33 n/a $0.23
FD Mkt. Cap / Per Metal
as % Spot Price:
6.71% 6.75% n/a 0.03%

Future Valuation (Cash Flow & Totals)

Totals 06/05/2016
Last
Analysis
Data

Current Data

Change
Item Value Value Updated Value
C
U
R
R
E
N
T
R & R Valuation: $411.55M $494.67M n/a $83.11M
Mkt. Cap: $184.22M $222.53M n/a $38.32M
Annual Gold Production: n/a n/a 0oz.
Annual Silver Production: n/a n/a 0oz.
F

U

T

U

R

E
FD Mkt. Cap: $3,000.00M $3,000M n/a $0M
FD Mkt. Cap Growth: 1,529% 1,248% n/a -280%
Annual
Production
Gold: n/a n/a n/a n/a
Silver: 10,000,000 oz. 10,000,000 oz. n/a 0 oz.
Current FD
Mkt. Cap /
Gold Eq. Reserves: 23.03 27.82 n/a 4.79
Silver Eq. Reserves: 0.92 1.11 n/a 0.19
Gold Eq. Production: 460.55 556.34 n/a 95.79
Silver Eq. Production: 18.42 22.25 n/a 3.83
P&P
Reserves
(oz.)
Gold: n/a n/a 06/05/2016 n/a
Silver: 200.00M 200.00M 06/05/2016 n/a
Gold Eq.: 8.00M 8.00M 06/05/2016 n/a
Silver Eq.: 200.00M 200.00M 06/05/2016 n/a
P&P Reserves
per FD
Share (oz.)
Gold: n/a n/a n/a n/a
Silver: 1.980 1.980 n/a n/a
Gold Eq.: 0.079 0.079 n/a n/a
Silver Eq.: 1.980 1.980 n/a n/a
Cash Flow 06/05/2016
Last
Analysis
Data

Current Data

Change
Item Value Value Updated Value
Current: $0.00M $0.00M n/a $0.00M
Current Multiple: 0.00 0.00 n/a 0.00
F
U
T
U
R
E
@ current prices: $8.34M $28.20M n/a $19.86M
Multiple @ current prices: 22.09 7.89 n/a -14.20
Growth @ current prices: 0.00% 0.00% n/a 0.00
@ future prices: $510.00M $510.00M n/a $0.00M
Multiple @ future prices: 0.36 0.44 n/a 0.08
Growth @ future prices: 0.00% 0.00% n/a 0.00

Defaults

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