In todays Gold Report: http://www.theaureport.com/pub/na/15734?utm_source=delivra&utm_medium=email&utm_campaign=Gold+final+11%2D27%2D13

"TGR: What other companies do you want to talk about?

EC: SilverCrest Mines Inc. (SVL:TSX.V; SVLC:NYSE.MKT) announced a silver resource of 199 Moz at La Joya. It's a low-grade, polymetallic skarn: silver, copper, gold, lead and zinc. The company followed that up with a pretty good PEA: an after-tax NPV% of $93M and a 22% IRR for a "starter pit" operation that is focused on the highest grade portion of the resource.

TGR: How do you rate its management?

EC: That's the main reason I like it. Chairman Scott Drever, President Eric Fier and CFO Barney Magnusson have been a team since day one. They are all well experienced in both exploration and putting mines into production.

That experience really showed with Santa Elena, SilverCrest's Sonora mine. It has good grades and pretty much an even mix between gold and silver in value. The team has managed to get it financed at the bottom of the market in 2009, which was no easy feat, and built it for a little more than $20M, which is pretty amazing. It's producing silver equivalent at $8.50/oz. That's quite a bit better than most.

TGR: What are the prospects for Santa Elena expansion?

EC: It's most of the way through one now. Santa Elena started out as a heap leach, but SilverCrest is building a mill, which should start production early next year. That should bring the company up from, say, 2.5 Moz silver equivalent to close to 3.5 Moz next year. As the mine gets into deeper, higher grade material, it should surpass 4 Moz silver equivalent in 2015. La Joya will be more difficult, but I definitely wouldn't bet against management building it on time and on budget and making sure it makes money.

TGR: SilverCrest is in Mexico, and the new mining regime proposed by the Mexican government has been met with threats by mining companies to close operations and cease investment. Is this premature?

EC: I think some of this is politics and not just on the part of the Mexicans. If someone raises your taxes, you jump up and down. I don't want to underestimate the seriousness of this, but it gets called a royalty when it really isn't. It actually comes off the net. I think it will reduce after-tax profits by 10%, which isn't wonderful but I don't think it will suddenly make economic mining projects uneconomic. What it will do is raise the bar a bit on projects still in development. Some operations that already looked a bit marginal might not get built now.

That said, Mexico, especially the northwest where SilverCrest operates, is one of the few areas in the world where companies can put mines into production fairly painlessly, with a well-understood permitting regime and low capexes. Miners that produce gold at $500 or $600/oz cash costs are not going to become unprofitable because of a tax increase from 30% to 37%."