TGR: Are there other companies under coverage that you'd like to tell us about today?

PK: I toured Kootenay Silver Inc.'s (KTN:TSX.V) Promontorio deposit in Sonora, Mexico, earlier this year. I came away quite impressed with the core and the layout of the land there. Management is extremely knowledgeable in hydrothermal-type deposits. I am currently anticipating a resource estimate to come out sometime in August and am targeting approximately 100 Moz silver equivalent, which is five times its historical resource. Management now thinks a substantial gold credit may be worked into the resource and would add additional value to the project valuation.

The stock has performed quite well during this market turmoil. I believe a lot of investors are keeping a close eye on it and it will be a good growth story moving forward.

TGR: You had a $2.50 target price on Kootenay around Christmas 2011. What's your target now?

PK: It's $1.75. It was cut based on lower comparable in-situ valuations for other silver explorers and developers.

TGR: The Promontorio deposit is quite promising and reasonably high grade. What about its mineability? Is the geological structure set in a way that's going to make this easy to mine?

PK: The deposit is a hydrothermal breccia and the structure could be easily mined with a combination of open-pit and underground mining to target the various zonations and concentrations of higher-grade mineralization. The deposit has only undergone one good round of drilling and management is planning additional exploration within the center of the zone in order to further prove continuity between the northeast and the southwest zones where the historic pit is located.

"The substantial leverage created by the U.S.' escalating debt will cause investors to shift away from these temporary investment vehicles and back into the safety of gold."

TGR: Then we don't really know yet if there's no pit wall drilling. Can you tell us about some recent results that keep you optimistic about Kootenay?

PK: It's definitely had some bonanza-grade intercepts, especially up in the northeast zone. It's had exceptional numbers of about 18m of 873 grams/ton (g/t) silver equivalent within an intercept of 71m of 297 g/t silver equivalent. The strong metal credits from lead and zinc (and now possibly gold) lead to a good indication of metal credits should the project become a mine one day.

http://www.theaureport.com/pub/na/13998