By: Dylan Sikes - AllPennyStocks.com News

Monday, April 22, 2013

Bolivia’s tin market may not be what it once was, but it is still a major supplier to the world. According to USG’s Mineral Commodity Summary 2011, the South American country was the fourth largest tin producer in the world with 16,000 metric tonnes produced, although it was far behind global leader China with 115,000 metric tonnes. Overall, the country produced $2.6 billion in metals. Sure, it’s not Chilean-type copper or even gold from Nevada, but it’s not too shabby for a country that generally doesn’t get much mention about global mining reserves. In 2011, Bolivia produced 39 million ounces of silver, making in the eighth largest producer in that category as well. That even ranked above the U.S.’s 36 million ounces. Apogee Silver Ltd. (TSX-Venture:APE) is looking to capitalize on the silver in Bolivian ore. The Toronto-based company’s flagship project, the 23,000-hectare Pulacayo-Paca project, is located 18 kilometers east of the town of Uyuni in the Department of Potosi in southwestern Bolivia. This project includes the property that covered the second-largest silver mine in the history of Bolivia with a historical estimate of over 600 million ounces of past production. Apogee took 100-percent control of the project in 2011 through execution of an agreement with Golden Minerals Co. in which Apogee acquired Golden’s subsidiary, ASC Bolivia LDC.

More than a year’s worth of exploration and development work later, the property is starting to reap some rewards for Apogee.

In January, the company completed its first pre-production sale of concentrates. The sale brought $609,000 to corporate coffers, or about 85 percent of the gross proceeds from delivering 95 dry tonnes (DMT) of lead-silver and 99 DMT of zinc-silver concentrates. Consoricio Minero S.A., a subsidiary of the Trafigura Group, purchased the concentrate from Apogee and will pay the remaining balance upon completion of a final analysis of the concentrate.

That milestone was followed with the filing of a positive feasibility study on Pulacayo showing the mine to have a lifespan of 12 years and annual pre-tax cash flow at production maturity of $39.3 million.

As it moves towards commercial production, Apogee keeps putting money in the bank with concentrate sales. In February, 41.4 DRT of lead-silver concentrates were sold to Consorcio with the company receiving the standard 85 percent initial payment; this time for $229,000.

On Friday, Apogee announced another sale to Consorcio for delivering 21 DMT of lead-silver concentrate and 160 DMT of zinc-silver concentrate. 85-percent payment was received totaling $233,000. The remainder is expected in about four months, according to Apogee’s statement today.

"We are delighted with our trial mining and milling performance to date. The Bolivian mining team have completed their training phase and have sufficient experience to ramp up production safely,” said Neil Ringdahl, chief executive at Apogee. He added that the company has stockpiled over 3,000 tonnes at the mine site that is ready for processing.

The company also said that it granted a total of 11.27 million stock options, exercisable at 10 cents for a term of five years, to certain directors, officers, employees and consultants of Apogee, subject to regulatory approval.

Apogee stock has been stuck in a downtrend since the beginning of 2011 when shares went as high as 46 cents. On Monday shares stayed flat at 4 cents, around its 52 week low as the Company suffers along with the entire mining sector as the resource bear market continues. 2013 could be a pivotal year for Apogee by turning into a producer, but they still have their work ahead of them. Proper due diligence is, as always, encouraged.

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