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CMC Metals Ltd. (TSX-V: CMB)

       CMC Metals Ltd. is a Canadian-based advance stage development mining company listed on the TSX Venture Exchange (ticker symbol CMB) (US Listing: CMCXF.PK) (Frankfurt: ZM5). The Company has come to our attention due, in part, to the exceptional opportunity afforded shareholders as CMB.V will be Canada's newest silver producer utilizing their 100% owned Silver Hart silver mine and mill set to come online in Q2 2010.

CMC Metals Ltd. was incorporated in 2005 with the purpose of acquiring a medium-size high grade precious metals deposit that was well advanced in exploration, yet one that fell just below the hurdle rate for most large corporations. Once acquired, the plan was to advance the project to fruition.

Silver Hart Silver Mine and Mill, Yukon, Canada

100% owned • Production to commence in Q2 2010

The Silver Hart property is located in south central Yukon, Canada in an area that contains numerous epithermal silver-rich vein and replacement style deposits. Access to the property is by a 42 kilometer all weather access road, 132 kilometers west on the Alaska highway from the community of Watson Lake. The property is comprised of 126 claims, covering and area of 2142 hectares.

In the mid 1980s the Silver Hart property was significantly advanced, to the point where the former owners had began the permitting process to take it to production, but for matters unrelated to the merits of the property the project was put in abeyance until 2005. With the assistance of well-heeled principles of CMC Metals Ltd. the Silver Hart project was acquired for the benefit of shareholders according to the aforementioned plan and now after a few years of added exploration and development that plan is now at the point of fruition and ready for production.

Silver Hart is a high grade silver property averaging over 56.5 ounces silver per ton (1930g/t). The historical resource (non 43-101) at Silver Hart is 9 million oz of silver, 17.6 million lb’s lead and 58.6 million lb’s of zinc in the three zones and CMC Metals is now in the advanced permitting stage on the project. By early October 2009 the Yukon Environmental and Socio-economic Assessment Board (YESAB) is expected to give CMB.V their development permits. CMB.V has already performed improvements in support of development side including mill pads, pressure area pads, the pit is completely stripped open, and about 1500 tonnes of ore containing over an estimated USD$1,000,000 of metal is stockpiled. An eight module prefabricated 80-tonne-per-day (TPD) mill is being constructed in Nevada with a delivery date expected this fall and there is the potential to increase the mill rate to 300 TPD with additional permitting and nominal capex.

The mill is currently ~75% complete. There are several advantages to modular prefabrication in that it gives quick up time for commissioning the mill, taking only ~30 days to mobilize the mill, and at the end it also allows CMB.V to decommission the site quickly and reuse that capital asset on another project.

There are several rate determining steps in the process of gaining the operating permit. Logistically the water permit takes six months after which the operating license can be issued. For cost efficiency the final mobilization will take place once spring thaw goes through, thus by the end of Q2 CMB.V will be in full production.

The first zone to be surface mined will be the 'TM', which contains an estimated high grade silver historical resource (non 43-101) of 6.5 million ounces, 11.5 pounds of lead and 19.9 million pounds of zinc. During the first two years 50,000 tons of ore will be mined by open pit methods prior to beginning operations below ground. The mill will run all year long however the actual mining season is ~150 days/year, sufficient ore to be stockpiled in that period. The above ground component is expected to yield on average 1100gpt of silver and 7.5% lead and zinc. Mining MarketWatch on its own has calculated an estimated breakeven silver cost of ~USD$4.45 per ounce with base metals credited towards operating expenses (~$4.45/oz cash cost of silver produced is net of smelter costs, labour, materials, and supplies). Silver Hart is 100% owned and there is no royalty/NSR.

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News July 29, 2009: CMC Metals Ltd. Announces 41,900 Grams per Tonne intersection in the TM Pit

Preliminary test results from the trench sampling in the TM pit at the Silver Hart Mine site. In preparation for pre-production, the Company is conducting a detailed surface trench sampling in the TM pit. The purpose of the trench sampling is to compare the historical data to the more advanced analytical measurements from a real-time XRF analyzer. The data will be used for excavation plans when the pre-production phase of the mine starts... See full news copy here.

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To date over $8.5 million has been spent on exploration and infrastructure development on the Silver Hart property – this includes over 8,834 m of drilling. The historical resource (non 43-101) at Silver Hart is 9 million oz of silver, 17.6 million lb’s lead and 58.6 million lb’s of zinc in the three zones (TM, S, and KL zones):

Strong Resource Expansion Potential 

There is strong resource expansion/development potential as there are over 20 known mineralized trench showings with visible massive galena, with only three of the twenty zones having been drill developed so far. Even the TM zone is open for resource expansion as CMB.V does not know the depth of what the veins go; CMB.V will need to do some deep drilling and determine if it makes economic sense to ramp down when they go underground and start mining some of the deeper veins. Also the S zone is a stack fault that parallels the TM to the northeast and other trenches that have visible massive galena showings with some drilling plus surface trench sampling include the F, M, B, K, and KL zones. CMC has systematically drilled the F, M, some of the K, and the KL zones to confirm the historical data and to expand the strike length on the KL and M zones. All of the above zones are open in all directions. There are also several linear geochem anomalies that haven't been trenched or drilled to determine the extent of mineralization. The linear anomalies also coincide with the same azimuth as the other known mineralized fault zones. In the G-alpha zone which is ~1000 metres north of the TM zone a slightly different depositional type of vein system exists and there CMB.V management believes it too will offer several years worth of mining of high grade silver along with lead and zinc.

Production in Q2 2010 Click to enlarge:

Logjam Property, Yukon, Canada

The Logjam Property is located in south central Yukon, Canada in an area that contains numerous epithermal silver-rich vein and replacement style deposits. Access to the property is via an 18 kilometer all weather access road north of the Alaska Highway kilometer marker 1216 or 200 kilometers east southeast of Whitehorse.
 
The property is comprised of 32 claims. The area, in which the property is situated, is underlain by a metamorphosed sedimentary sequence of the Devonian-Mississippian Age intruded by a northwesterly striking band of Diorite of the Jurassic-Cretaceous Age.

Mineralization on the Logjam property consists of at least 10 northeasterly striking mineralized fracture zones rather than clear cut massive quartz veins as has been suggested in the past. The ten known silver-bearing structures strike northeasterly across a northwesterly trending elongate diorite intrusive that is about 450m in thickness. The possibility of developing numerous hundreds of thousands of tons of reserves is good. Potential of the property is thought to be in the million ton range. At least eight veins are partially exposed on a steep cliff where they cannot be adequately sampled. Six of the eight veins on the property have not yet been sampled underground (in the favourable diorite). The underground development has indicated that the veins have steep dips and can be mined without timbering and with only minor dilution. It has also proven that the mineralization extends through a vertical range of almost 250m with no significant change in mineralogy or grade. Two of these veins (5 Vein and 6 Vein) have been explored underground where a number of mineralized sections were located that averaged about 15 opt Ag, 0.14opt gold and 6 percent combined lead and zinc across a thickness of 0.3 to 1.0m. The mineralized sections range from 12 to 35m in length and represent from 12 to 57 per cent of the total length of vein drifted in each heading within the favourable diorite. This deposit has the advantages of excellent ground conditions and topographic relief for underground mining, and a favourable location close to the Alaska Highway. Adit development is feasible for at least another 200m vertically lower (than the 5150 level).

Wheelbarrow Property, Yukon, Canada

The Wheelbarrow property is located 20 km northeast of Atlin, B.C. The property comprises of four claims with a surface of 1,489 hectares. There has been a substantial amount of historical work conducted on the property since the original discovery in the early 1900's. Over 3983 meters of drilling, extensive trenching, geological mapping of host units, soil survey's, and air borne Mag and VLF-EM was conducted over the entire property. The property boarders two past producing mines plus the Adanac Ruby Creek property. There are seven known mineralized zones that have been identified with high grade silver. CMC is interested in continuing the drilling and sampling of the zones to define the strike and depth of the mineralized zones for the purpose of resource determination and a preliminary mine assessment. The following are some of the trench and drill sample intervals that were encountered by past exploration:
 

CMC Metals is encouraged with the above showings and will proceed to expand the geological understanding of this deposit through additional exploration. For the 2009 season CMC Metals is proposing to continue to assemble the historical data, surface trench outcrops, strike and depth drill at least one showing, and geologically map the data. Don Wedman P.Eng., CEO and President of the Company commented "We are very please with the opportunity the Wheelbarrow property presents for the Company. The demonstrated grades and showings fits well with our Company focus of high grade silver developments. In addition, the semi-mobile mill being fabricated for the Silver Hart project would have the capability to process ore from this site. We will prepare this property over the next few years for feasibility assessment and development." Exploration permitting will begin immediately with the target of starting a on the ground investigation this July.

Mr. Don Wedman received a Bachelor of Science, Mining Engineer, at the University of Alberta. He has over 25 years experience in mine feasibility assessments, development, and environmental permitting. His project management skills are an asset in moving exploration properties into the development/production stage. From 1981 to 1997 he was a Senior Engineer with Alberta Power Limited (ATCO Power) managing fuel contracts, contract negotiations, and conducting mine resource assessments. In 1998 he joined Geographic Dynamics Corp. as the General Manager, for project managing environmental and ecological resource assessment studies. From 2003 to 2005 he also was the Vice President of Coremetric Development Corp., assisting in the development of the first iron quarry in Alberta. He has served on a number of volunteer boards including APEGGA Career Committee (Chairman), and the Edmonton Branch of CIM.
 

Michael Scholz, B.Com., LL.B., CFO and Director
Mr. Michael Scholz received both a Bachelor of Commerce (B.Com.) and a Bachelor (LL.B.) of Law from the University of British Columbia. From 1978 to 2001 he was Solicitor and Senior Partner of the law firm Alexander Holburn, and is a member of the BC bar. He is a director and Chairman of Avcorp Industries Inc., a director of Uniserve Communication, and from 2001 to 2004 was President, Vice Chair and director of Great Canadian Gaming Corporation.

  
Steve Mathiesen, B.A. (Economics/Commerce), LL.B, Director
Mr. Steve Mathiesen has been a business lawyer for 25 years and is a partner with Lang Michener LLP, in its Vancouver office. His practice includes acting for public and private companies in mergers and acquisitions and in financings. Steve was the founder of CMC's predecessor company.

Jacob Brouwer, Director
Jacob Brouwer is the Chairman and Chief Executive Officer of Brouwer Claims Canada & Co. Ltd., an insurance adjusting firm, and is the founding director and Chair Emeritus of Bank West Inc., Governor of both the YMCA, Vancouver, BC, and the Vancouver Aquarium and Member of its Finance Committee. Mr. Brouwer is a Charter Member of the International Institute of Loss Adjusters Inc., world headquarters in Chicago, Illinois, and a member of the B.C. Premier's Fund Raising Committee and Federal Conservative Fund Raising Committee. In addition to Mr. Brouwer's many accomplishments, Mr. Brouwer has sat on the Board of many commercial, public and other organizations during his reputable career and brings to the Company his many years of business experience.

Jatinder (Jack) Bal, Director
Jack Bal is a business executive, with over 11 years of experience in the resource industry and public markets. His contacts in several international countries known for precious metal mining are invaluable in identifying potential property acquisitions for CMC. Mr. Bal was the founding member and Vice President of Apparo Software Inc., past Director of Saintstar Ventures Inc. and is currently a Director of Eaglestar Ventures Inc. and President of Journey Resources Corp.

Daryl Pollock, Director
Daryl Pollock graduated from the University of Manitoba with a B. Comm (H) and has since enjoyed 35 years of business experience in marketing and investment related endeavors. More recently he served as President and CEO of Olympic Resources Ltd. from 1992-2002, prior to its merger with Whittier Energy Corp., with whom he sat as a Director. Mr. Pollock is currently involved in a variety of early stage development projects, primarily related to Alternative and Clean Energy.

For more information contact Gord Zelko, VP Business Development at: Ph (250).495.7123
 

E-mail: contact@stoxnetwork.com   Company's web site: www.cmcmetals.ca

SEDAR Filings: URL