Vancouver, British Columbia, June 27, 2012 - Fundamental Research has initiated coverage on El Tigre Silver (TSXV:ELS) (OTCQX:EGRTF) (Frankfurt:5RT).
The company, through its subsidiaries, holds the rights to 100% of nine mineral concessions, eight of which comprise the 431 square kilometre flagship El Tigre Property in Sonora State, Mexico. This property is located within the northern part of the highly prolific Sierra Madre Gold-Silver Belt, and includes the historic El Tigre underground mine, which operated from 1903 to 1938, with total estimated production of 75 million ounces of silver and 380,000 ounces of gold.
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Mexico has long been one of the best countries in the world for silver exploration and mining projects, and according to the Silver Institute Mexico produced a record 761 million ounces or 21% of the world's silver production.
The main El Tigre vein was historically mined over a 1.5 kilometre strike length. Management believes the total strike length is 5.3 kilometres. During 2011, the company completed 10 widely spaced drill holes to test mineralized targets identified by Anaconda in the 1980s, and follow up on the initial field work completed by El Tigre in 2010. The targets were found to host areas of both high grade vein silver mineralization and low grade disseminated gold mineralization. More specifically, the company identified a potentially large open-pitable resource immediately south of the El Tigre vein in the hanging wall of the fault in an area known as Gold Hill.
2012 exploration will include 5,000 metres of drilling aiming to define a large, low grade bulk tonnage silver-gold deposit at Gold Hill. A NI 43-101 compliant resource estimate for Gold Hill is expected by the end of the 3rd quarter of 2012.
Significant exploration potential exists across the entire property with several high and low grade vein systems relatively unexplored to date. Company's management believes the property has an exploration potential greater than 100 million ounces of silver.
Fundamental stated that, "After our site visit, and reviewing the data provided to us by management, including channel samples, and auger drilling completed in 2011, we believe the stock pile contains between 750,000 to 800,000 tons of material."
During Fundamental's visit, they learned that much of the historic mine was backfilled at the time of closure with run of mill ore which could potentially be a future source of easy mill feed.
The company has appointed the same process providers who designed the Malpaso Mill used by Dia Bras Exploration (TSXV:DIB) in Chihuahua State. At 250 tons per day, Fundamental believes there is enough material for a 8 to 10 year mine life resulting in potential total recoveries of between 1.5 and 1.8 million ounces of silver and 8,000 to 9,000 ounces of gold.
Fundamental Research believes that investors should view the El Tigre property as a medium to long term exploration project, with near term upside provided by cash flow from processing of the historic tailings, which is due to start by the end of 2012.
Analyst Siddarth Rajeev gives the company a buy rating and a valuation of $0.30 per share based solely on silver/gold production from the historic tailings stockpile. The shares currently trade at $0.26 and with approximately 38 million shares outstanding, it is capitalized at $9.8 million.
Sprott Asset Management (TSX:SH) and Pinetree Capital (TSX:PNP) hold a combined interest of 15%.
For more information, please visit the company's website www.eltigresilvercorp.com (http://www.eltigresilvercorp.com), or contact President & CEO Stuart Ross at 780-977-7187 or email srross@eltigresilvercorp.com (mailto:srross@eltigresilvercorp.com).
You can obtain a copy of the Fundamental research report at www.researchfrc.com (http://www.researchfrc.com/).
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