News

May 22, 2008

Silver Standard Is Now Focused on Bringing Pirquitas Into Production Early Next Year, And On Budget Too

By Charles Wyatt

There is only one blot on the landscape at Silver Standard, so it’s probably better to get it out of the way immediately as there is much more good news. Last summer, the company disclosed that it had been caught up in the sub-prime mortgage scam, or as North Americans prefer to call it, asset-backed commercial paper. What and where these assets are, no one is quite sure, but as at the end of March Silver Standard’s investment was an initial C$57.1 million which it had written down to C$26.7 million. The next question is who persuaded a very staid company to seek a few extra points of interest in such an investment? Chief executive Bob Quartermain avoids answering for legal reasons, but C$43.8 million certainly went through HSBC into what are called Coventry-sponsored conduits, and what he has said is that he is considering court action to recover the investment in full.

Enough on that subject as it appears to have made little impact on the financial standing of Silver Standard, though the market valuation of the company did suffer. In February Silver Standard raised C$134 million net in convertible notes after the over-allotment option granted to the initial purchasers was exercised in full. The money is going to finance part of the development costs of Silver Standard’s 100 per cent owned Pirquitas project in north western Argentina. It will also fund...