corporate presentationjuly2011
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Forward Looking Statements
Certain statements contained in or incorporated by reference into this presentation constitute forward-looking statements. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions as they relate to U.S. Silver or its management, are intended to identify forward-looking statements, however, other information may also constitute forward-looking statements. Such statements reflect the current views of U.S. Silver with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of U.S. Silver that may be expressed or implied by such forward-looking statements to vary from those described herein should one or more of these risks or uncertainties materialize. U.S. Silver does not intend, and does not assume any obligation, to update these forward-looking statements.
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Strong Silver Market Trends
In 1980, when Nelson Bunker Hunt was asked as to why he had developed a passion for silver, he said; "Silver looked safer than overseas oil concessions, the way things were going. And precious metals were a good hedge against paper money".
Silver Demand – Industrial and Investment
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Silver Gold Ratio
Strong Silver Market Trends
Silver up 110% since January 1, 2010
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Million oz Ag Annual production 85% of revenue from silver
Company Overview
2.4
Established producer in prolific Silver Valley in Northern Idaho
Low cost incremental growth potential (excess capacity)
Revenue of $85 million at current prices
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Located in Historic Silver Valley
Montana
Oregon
Washington
British Columbia
Spokane
Alberta
Missoula
Boise
Idaho
Over 1 billion ounces produced
Modern and ample infrastructure in place
Safe and friendly jurisdiction
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Company Overview • 100% interest in the producing Galena silver-copper-lead mine
– High grade narrow vein mining operation, opened in 1953
• 100% interest in the Coeur Silver mine – Redevelopment plans underway
• 2 mills (Galena and Coeur) – Both in use, excess capacity available
• Dominant land position in the Silver Valley – Large under explored property
• No historic environmental liability with EPA – Settled in 2001
• Hedged 20% of production in 2011 to protect CapEx program • 80% unhedged, 100% unhedged in 2012 and after
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Million oz Ag
Proved & Probable Reserves
21.9
86 Million lbs. lead
11 Million Lbs. copper
Provides a 7 year mine life
Exploration consistently replaces annual production
Has produced for almost 60 years and still keep finding ore
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Recent Results
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• Q1 2011revenue lower due to two rail cars shipped but not received un@l early Q2
• Q2 will have record revenue and profit as a result
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Million
Market Data
$193
Current Market Cap (July 14, 2011)
52 week hi-lo $0.83 - $0.15
292.4 million shares outstanding
335.3 fully diluted
TSX.V and OTCQX average daily volume 1 Million
Undervalued vs. peers on key metrics
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Galena Mine – an impressive history
High grade, narrow vein, copper-silver & lead-silver mine
Short term variability in operating results, long term proven producer
No historic environmental liability
2nd largest
Primary silver producer in the U.S.
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Galena – Past & Present
Focusing on higher grade zones to increase head grade Examining production expansion options with high prices Continued exploration success and mine life extension
1 million
Ounces produced
7 9
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Mining Operations
No.
3 S
haft
Gal
ena
Shaf
t
Cal
aday
Sha
ft
Coe
ur S
haft
2400
Sea Level
3700
5500
Cal
laha
n Sh
aft
4900
483 356 400
Coeur 3700
2800 3000
3400
1200
Silver Vein 117-215
72
Ag - Pb Veins Ag - Cu Veins
5200
4600 4300 4000
LEGEND
175
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Galena Performance
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500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Forecast
Silver ounces produced
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Milling Operations
Excess Capacity Galena Mill 900 tons/day and Coeur Mill 500 tons/ day = total capacity of 1,400 tons/day
Ores 2 ore types (silver-copper and silver-lead) have separate crushing, milling and flotation circuits
Recoveries Consistent mill recovery rates of 96% for silver-copper and 92% for silver-lead ores
Smelters Silver-copper concentrates railed to Quebec and silver-lead cons trucked to Trail, BC
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Reserves Detail
• Current 43-101 based mine life of approximately 7 years
• U.S. Silver continues to cost effectively add reserves well in excess of its production, continually extending mine life
• Reserves increased by 115% since 2006
Ag Lead CopperTons Ag (oz/t) (MM oz) (MM lb) (MM lb)
Proven & Probable Reserves 1,615,700 13.6 21.9 85.6 11.1Measured & Indicated Resources 560,600 15.6 8.7 14.4 4.8Inferred Resource 1,026,300 13.4 13.7 103.3 5.4Total 44.4 203.3 21.3
Contained
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Restarting The Coeur Mine
• No permitting or acquisition costs
• Existing excess mill capacity
• Examining alternative mining methods & scale
• Additional drilling underway to better define deposit
• Significant exploration upside
5.9 million
resource ounces targeted
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• Dominant land position • Under explored, accessible • Strong cash flow funding all
plans, 50% increase in footage in 2011
• Identified 6 surface & underground targets that are ready for drilling
• Historical success of increasing reserves well in excess of production
14 Thousand
acres of land
Exploration Potential
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Significant Reserve Growth
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
2005 2006 2007 2008 2009 2010
Proved and Probable Silver Reserves
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Surface and Underground Drill Targets
CDA “GAP”
Western Coeur Mine
Argentine Vein
Deep Coeur Mine
Deep Silver Vein
Calady Mine Lead-Silver
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Surface Drilling Targets
Commencing 12,000 foot surface drilling program • CDA Gap • Argentine Vein Drill ready targets identified by • Surface and underground showings • Geochemical profile matching that of Galena/Coeur • Strong correlation between surface tetrahedrite
showings and deeper silver vein systems
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Underground Drilling Targets
• Targets: Western Coeur Mine Deep Coeur Mine Deep Silver Vein Caladay Lead-Silver
• Targets are extensions of known vein systems
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Experienced and Stable Workforce
33 with over 20 years of experience Additional 30 contract miners
237 employees
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The Right Management Team Gordon E. Pridham Chairman
• Over 25 years experience in investment banking, capital markets, and corporate banking • President and CEO of Edgewater Capital and Chairman of Titanium Corporation
• Serves as a Director for Newalta Income Fund
• Formerly with Chemical Bank and National Bank, in the energy and minerals sector in New York, Calgary, and Toronto
• Formerly with Merrill Lynch Canada and Midland Walwyn and managed the Investment Banking groups at Deutsche Morgan Grenfell, Research Capital, and Raymond James
Tom H. Parker President , CEO & Director
• Mining engineer with over 40 years experience in the mining industry • Former President and CEO of Gold Crest Mines and High Plains Uranium
• Worked for 10 years as an Executive VP of Anderson and Schwab, a New York based management consulting firm
• Former CEO of Contain Minerals which owned 22 coal mines, the Brewer gold mine, and Montana Talc
• Worked for 10 years for ARCO where he was President of Beaver Creek Coal Mines, General Manager of Nevada Molly, President of Thunder Basin Coal and VP for Engineering, Exploration and Business Development
• Former General Manager of Jacobs Ranch mine for Kerr McGee Coal and served as Project Manager for Conoco
Steven Long Chief Operating Officer
• Over 33 years experience in mine engineering and management • Direct senior management of underground mining operations for Newmont Mining Corporation in Elko, Nevada and Barrick
Gold, Echo Bay and Homestake Mining
Chris J. Hopkins CFO
• Chartered Accountant with over 25 years experience in financial management, strategic planning, mergers and acquisitions, corporate finance and financing and management reporting
• Formerly with Rio Algoma, Suncor, and several junior mining and oil & gas companies
Mine Management • Many long service management end employees provide knowledge and continuity • New management bring new thinking and approaches
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The Right Board
John S. Brock Director
• Geologist with over 40 years experience as an executive for 20 public, junior exploration companies • Participated in 12 major mineral deposit discoveries in north and western Canada, Nevada, Mexico, and Ecuador
• Served six years as governor of the Vancouver Stock Exchange (TSX Venture Exchange) and CDNX Exchange and 2 years on the TSX Venture Exchange Advisory Board
• Currently CEO of Pacific Ridge Exploration and Senior Consultant to the Manex Resources Group
James M. Macintosh Director
• Geologist and mining analyst with over 15 years experience • Served as an executive and a director of numerous public and private companies in Canada and the United States
• President and COO of Innovium Capital, a company that invests in innovative opportunities
Kevin D. Stulp Director
• Served on the board of Aurora Oil & Gas since 1997 • Worked as a consultant with Forte group,
• Held various positions with Compaq Computer Corporation, including industrial engineer, new products planner, manufacturing manager, director of manufacturing and director of worldwide manufacturing reengineering
Alan R. Edwards • Board of directors for Gammon Gold Inc., Entrée Gold Inc., and Copper One Inc. • President and Chief Executive Officer of Copper One Inc.
• Senior management positions with Frontera Copper, Apex Silver Mines, Kinross, Cyprus Amax, Phelps Dodge
• Mr. Edwards holds an MBA from the University of Arizona and a B.S. Mining Engineering also from the University of Arizona.
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Summary
Opportunity to Capitalize on a proven and established asset • Produc@on growth • Reserve Growth • Explora@on Expansion
Increased Strength
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Summary
• Highly leveraged silver producer,
85% revenue from silver, strong cash flow • Stable and consistent production • Infrastructure in place with excess capacity • Dominant land position with significant
exploration upside with in a highly prospective region • No debt, sufficient financial capacity to execute
growth plan
• No historic environmental liability
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