Group Buy::: The RealCent Silver Mine

[shinnosuke]

I'm really grateful to IdahoCopper for bringing this idea to the table. It may be that fate has brought us a silver mine. Or, it may be that instead of us buying this mine, having confirmed that at least some of us are willing to work together on a project, we may create a company to do something else. I like to see the creative juices flowing.

But for now, what are our next steps for considering Herb's property?

[IdahoCopper]

Due Diligence is always important. I think I have posted enough info for a very good start on that.

We need a roster of everyone who is seriously interested, and another roster of everyone who is potentially interested. A realistic survey is needed of the total amount of money/bullion that can be "pledged" by those interested. This allows us to realistically determine if we have enough to make a serious offer. The individual pledges can be confidential to the majority of the group, if folks are more comfortable with that...sort of like a secret ballot.

We need to delegate one to three point persons who can research and report.

A plan that addresses the options of buy and hold, or work the mine, or some combination of those; needs to be fleshed out.

If we proceed, a corporation will be required.

.................That's a start.

[beauanderos]

I'm totally fine with being sent to my death!

Don't let Hoard find out, he's always in need of cheap labor in his penny processing center. On the issue of the mine, there is a vast difference between holding a lease to later resell, and the whole new can of worms you would open if you planned to attempt to actually mine it. The first is merely purchasing an option - which I would be willing to do if DD showed true potential, the second is starting a business - where I would then have to agree with those who admit we know nothing about mining. Now if we were talking about investing by private placement into an already operating mine, it would be a different matter, but the second plan would require an immense amount of effort, and those extending efforts on the behalf of the enterprise should be fairly compensated in some manner.

[shinnosuke]

IdahoCopper, do you have any other contacts in the industry in your immediate area? Can you confirm if there are any other small properties with similar characteristics? If you could find some comparable recent sales we would know if the asking price is fair.

Does Herb not have family?

[IdahoCopper]

There are 700 people in this group. Everyone knows their own circle of contacts, who have areas of expertise. I think in a group this size, any skill, any professional, any knowledge is only one handshake away for someone in the group.

Just because we aren't miners, does not mean we do not have a close contact with someone who is a miner.

Same goes for any needed skill, from CEO, to CFO, investment guru, on down to pick and shovel operators.

[IdahoCopper]

IdahoCopper, do you have any other contacts in the industry in your immediate area? Can you confirm if there are any other small properties with similar characteristics? If you could find some comparable recent sales we would know if the asking price is fair.

Does Herb not have family?

I do not have any direct contacts in the mining industry. My experience is working in an open pit copper mine in Arizona, for a huge corporation about 30 years ago. I drove a 80-ton or a 200-ton haul truck up and out of the pit.

The satellite map I posted last night shows the patented claims in the immediate area near the proposal site. I can't confirm how similar those properties are to the one we are interested in, because I do not have a professional mining survey for those. The Idaho government does have records going back to the mid-1800s for the output of all the mines in the area. Some of that data is in the three .PDFs I posted. I highly recommend that if you are seriously interested, print out those docs and study them.

Comparable sales are pretty much non-existing. There just aren't many properties similar enough to compare.

Yes, Herb has some family.

[shinnosuke]

I do not have any direct contacts in the mining industry. My experience is working in an open pit copper mine in Arizona, for a huge corporation about 30 years ago. I drove a 80-ton or a 200-ton haul truck up and out of the pit.

Were you at Bisbee?

[VWBEAMER]

Let's all get together, buy it,film ourselves working itand then sell as a reality TV show....

[highroller4321]

Shouldn't an assay of the land be done now instead of going off a report that is 26 years old?

[IdahoCopper]

1.) Discovery Channel. An interesting idea. With silver about to explode into the public's eye, a case for a reality show could be presented to them. It is unlikely they will contribute much cash for the venture. But investigation of this potential is warranted.

2.) If/when we choose to make a real-world go at this, a corporation, following SEC regs will be essential. A casually contracted agreement or association won't cut it.

3.) Raising part of the money and borrowing the remainder is risky, it adds another layer of risk. However, if we have the money to make the property purchase free and clear; and decide to go operational, money might be borrowed to cover the machines required, and expenses. Alternatively, Buy and Hold is still a good strategy, with a lot less risk.

4.) Herb may or may not finance part of the purchase. That is something that can be asked, once we know how much money we might have to work with. Herb may also take part of the payment in Ag bullion. A lot of us have that........

5.) The potato farmer idea, isn't going to fly. The mine location is in the mountains at 7,500 foot altitude. This presents a difficulty because of winter and the snow pack. The mine is likely to be inaccessible in the winter.

6.) A name for the venture must eventually be decided upon.

7.) I looked into dynamite certification. There is a 2-day class in Oregon, cost is $1250 per student. Lab materials are provided.

8.) My mine experience was at the ASARCO pit, south of Tucson.

9.) In the 26 years since the mining survey, no mining activity has occurred. Most assuredly, nothing has changed about the extent of the ore body.

10.) Herb told me that there are two tunnels, an upper and a lower. Both payed well when they were mined. The ore body between the two tunnels is virgin and has huge potential, if dug with the correct scale machinery.

[highroller4321]

1.) Discovery Channel. An interesting idea. With silver about to explode into the public's eye, a case for a reality show could be presented to them. It is unlikely they will contribute much cash for the venture. But investigation of this potential is warranted.

2.) If/when we choose to make a real-world go at this, a corporation, following SEC regs will be essential. A casually contracted agreement or association won't cut it.

3.) Raising part of the money and borrowing the remainder is risky, it adds another layer of risk. However, if we have the money to make the property purchase free and clear; and decide to go operational, money might be borrowed to cover the machines required, and expenses. Alternatively, Buy and Hold is still a good strategy, with a lot less risk.

4.) Herb may or may not finance part of the purchase. That is something that can be asked, once we know how much money we might have to work with. Herb may also take part of the payment in Ag bullion. A lot of us have that........

5.) The potato farmer idea, isn't going to fly. The mine location is in the mountains at 7,500 foot altitude. This presents a difficulty because of winter and the snow pack. The mine is likely to be inaccessible in the winter.

6.) A name for the venture must eventually be decided upon.

7.) I looked into dynamite certification. There is a 2-day class in Oregon, cost is $1250 per student. Lab materials are provided.

8.) My mine experience was at the ASARCO pit, south of Tucson.

9.) In the 26 years since the mining survey, no mining activity has occurred. Most assuredly, nothing has changed about the extent of the ore body.

10.) Herb told me that there are two tunnels, an upper and a lower. Both payed well when they were mined. The ore body between the two tunnels is virgin and has huge potential, if dug with the correct scale machinery.

Any serious interested buyer would want an up to date survery. It could have been surveryed in 85 and hit HEAVY for the next 5 years. Not calling you or your friend herb a liar, but a lot can happen in 26 years.


If it was so profitable than why did he stop mining it? Why aren't the "big" mining companies interested in it?

[IdahoCopper]

This was asked in a PM:
"My main question is....would we buying just the mining claims to the land or the land itself with the claims attached. If not the land then who owns the land? And what else is on the property now...ie houses, roads, powerlines, etc."

There are two types of mining claims, patented and unpatented. Herb's claims are patented. That makes them equivalent to private property. Unpatented claims convey only mineral rights. If on BLM land, the property is still gov't-owned. Since the mid-1990s, the gov't has suspended granting of patented claims. Herb's patented claims are more valuable simply on that fact.

There are forest service dirt roads. No powerlines. A ghost townsite is nearby, Carrie Idaho. There are probably a few ramshackle cabins in the area.

I have not been to the site yet. Its still snowed in for another month or so.

[IdahoCopper]

highroller - - Any serious buyer would visit the site to determine if any recent mining occurred. The sat image is some proof of no mining, but boots on the ground are essential.

I think Herb never did much more than poke around after he bought the mine, but I'm not sure. I need to talk with him again to get more info. I'll do that after a few days of discussion here, so I can ask him a lot more questions from the RealCenters.

The "big" companies ARE interested. This opportunity does have an expiration date......as soon as another venture puts money down for the mine purchase, its not really for sale any more. That could happen at any time. Kevin, the RE agent, says several serious inquiries are being made.

A new survey would probably cost $50,000 or more and require 2, maybe 3 months to perform. That would be full-risk money. If the survey was a contingency clause of the purchase contract, it might make sense.

[jerry278]

Not to burst anybodys bubble, but to be honest after having a Season one of 'Gold Rush' and Season 2 on the way I dont know if the discovery channel would be entirely willing to foot the bill again. Would be very nice though. 'Gold Rush' might be as much 'mining' that the public can handle at the moment.

But sounds like a very interesting/ once in a lifetime oppurtunity. The reward could be exorbitant, so could the risk however.

If you decide to have 'shares' I think you would raise more funds by having shares cheaper say $50-$100. Alot of people on here arent going to be able to afford $1000 a share, and by having the shares cheaper the big guys can just buy more shares and own an equal part in the compnay as they would with expensive shares. I think the fundraising here would go from maybe 10% of the members at $1,000 a share to atleast 50% at say $100 a share. It would be a project with accounting and such, but the whole thing is a project then again.

[IdahoCopper]

Not to burst anybodys bubble, but to be honest after having a Season one of 'Gold Rush' and Season 2 on the way I dont know if the discovery channel would be entirely willing to foot the bill again. .

What makes you think Discovery put up any money to help the Gold Rush crew? I have no idea how those TV show fundings are structured. But it is worth looking into.

I think with SILVER on the ascendant, and the public will soon be hungry for SILVER info, the timing for a show is good. Some other channel besides Discovery might want a show to compete with Gold Rush, Alaska.


Hmmmm...... any ideas for the show's name???

[Sheikh_yer_Bu'Tay]

I am seriously interested. Unfortunately, all I could muster right now are a few thousand I have very little money in FRN's.

The main thing "Gold Rush Alaska" showed is how to piss away a lot of money. With what little placer mining I have done, those guys would make me cringe!

Thogey is right. This is very serious stuff and not to be intered into light-heartedly. Don't anyone here think this is free silver. This will be hard work. The true miners will work their asses off for it, while the investors worry about paying the bills. $1.8 million is just the buy-in, then you actually have to spend even more money on equipment, or whatever else is needed to make it all produce.

Don't forget, the refinery where the concentrate is sent to will want a big slice of the pie for their work, too.

None the less, IF this is for real, I am very interested.

EDIT: I am dead serious... you have NO IDEA how much micro-fine gold vibrated right off the end of the sluice box and back down the creek in "Gold Rush Alaska", and then there is the non-starter, way they worked their black sands. A person could have made more money than they did if you just re-worked their wash water!!

[IdahoCopper]

http://twinfalls.craigslist.org/grd/2259595365.html

[shinnosuke]

The "big" companies ARE interested. This opportunity does have an expiration date......as soon as another venture puts money down for the mine purchase, its not really for sale any more. That could happen at any time. Kevin, the RE agent, says several serious inquiries are being made.

IC, thank you for responding to our many, many questions. You're doing yeoman's work and I hope you're not getting frustrated. There will inevitably be a lot of "stupid" questions. I am probably the leader in that category.

Let's dissect the comment I quoted from you above.
1. The "big" companies ARE interested. That's a good thing. Even if another company buys the property, we will know that we are considering a worthwhile project and we can take this momentum and use it to start another project.
2. This opportunity does have an expiration date......as soon as another venture puts money down for the mine purchase, its not really for sale any more. Time is of the essence. Since we still need to form a corporation, decide whose in and whose not, do a lot of DD and then make an offer we will likely miss this opportunity. But refer to #1 above. It's OK. Herb's place is not the only silver mine in the world for sale. In fact, if we are willing to buy shares in a company that mines silver, it sort of begs the question of why don't we just buy shares in a company that is already established and successfully mining the stuff? Why don't we pool our funds, buy a controlling interest in an existing company, seat a few of our representatives on the board and run that company like we intended to run our start-up? We can even keep current management in place if they are performing well.
3. That could happen at any time. Kevin, the RE agent, says several serious inquiries are being made. No offense to IC or Kevin, but RE agents get paid by saying stuff like that. In this case it's probably true. So we may miss this opportunity. See #1 above.

Isn't investing fun?

[Treetop]

things to consider..... I was probably one of the first people who married a women I met online. We talked for years, about every little nook and cranny of our entire lives. we shared it all, just as friends mind you. At one point we decided to meet and it was great of course I indeed married her in time. BUT...... Let me tell you having online friends and then meeting them in life can be interesting. Many aspects of a character simply cannot show up in type. So forming a group of folks to do a thing like this will have issues none of you see, to be anticipating.

that said I do think this is a great bunch of people here, if any forum Ive been on could pull such a thing off it would likely be this one. And yes business is not love of course, but its not much different, when your $$ all ride on decisions others do. what happens if someone feels cheated or left out? do they bring actions that hurt the others desperately trying to fund the mining op? what if you just buy it to sit on it, but find out some members go there and do some digging? there are a thousand possibilities. This would be hard if we all lived in idaho down the road from the mine let alone sopread across the country and into others.....

heres another thought, in regards to mining it.... i doubt you guys could fund others to do the work... so youd need a realcent crew... could that even work? do they get more shares for their efforts? or paid by your company? hiring workers, having equipment, on top of buying the place is a huge thing.

something much more feasible I thought of before (and you could form a corp to do this to) is buying scrap gold and silver coins. I live in a tiny town in the middle of nowhere, and when a company showed up to buy gold and silver there were people lined up all day to sell their silver (not much gold here) WELL below spot. something like that has a much faster turn around, over start up cost, and really could be very profitable......

just thoughts of a real center, none of this is meant to change any of your minds.... just think about a few things....

[Thogey]

Good luck guys.

If you guys really want to form an investment consortium, and this 'once in a lifetime opportunity' falls through you could also investigate the thousands of 1to 40 acre placer and load claims for sale all over AZ. You can get many them for a couple hundred bucks each. Year round mining. Placer claims, where the gold is on top. No trommels, rock crushers or chemical extracting required.

Sheik is right about the mine tailing piles. I've worked old piles and found 'easy' gold. Back in the old days they didn't mess with the flake.

[AGCoinHunter]

I would have some limited investment interest depending on a lot of different factors.

As a side note, can I pay for my share in zincolns?

[STINGER]

100 acres doesn't seem like near enough land to get anything goin. You would use 1/5 of it just to set up shop. How much of this ground has he already mined? Is there any equipment included in this price? I'd offer him $200,000 if it was just the land. If it produced enough to turn much of a profit this guy wouldn't be to old to mine. He would be sitting in his office everyday while it was getting mined.

[IdahoCopper]

Most folks here have seen the Gold Rush TV show. That was placer mining. The gold is pure and discrete, and is simply sorted from the dirt and rock.

The mine in Idaho is hard rock mining. The ore is blasted and removed to an on-site crusher and concentrator. Then the concentrate is trucked to a refinery for processing into bullion, probably 1,000 oz Ag bars. The lead is also refined and sold as a by-product.

I do not know how large the crusher and concentrator plant is for silver mining. My guess is it can be set up on 1/2 acre.

There is no equipment offered in the deal. The present owner used the "Buy and Hold" investment plan with this property. He did not mine the ore very much.

We all know what each one of us would personally do, if we owned a mine like that. It is not fair or appropriate to project our own "druthers" onto anyone else, or make wild-ass assumptions of why it wasn't done another way.

Keep in mind that this mine is only becoming feasible again because the spot price of Ag has climbed so much recently. Herb probably did not mine the ore because at $10 per oz, it just was not a profitable operation. But at $35/oz, now it can be a good opportunity.

Stinger - - go ahead, raid your hoard and make a valid offer to Kevin for $200,000. He is obligated to present the offer to Herb. Doesn't mean Herb will accept and sell it to you.

[IdahoCopper]

Ok. I've gone over everything posted and the PMs I got. This is my assessment after 20 hours.

If an association was formed to do this project, it only makes sense to do it as a "Buy and Hold" investment. The risks are too great to buy it for an immediate mining operation.

That being said, the buy and hold option can end anytime the shareholders decide to begin mining, instead of selling the mine to others at a profit.

So if silver gets up to $250 per ounce, and we still own the mine, why not begin digging, instead of selling it? Essentially it would be the decision of the shareholders on selling or digging.

But the original plan should only be Buy and Hold....then see what happens.

That's my 2 copper cents.

[argent_pur]

When we say "shares", I'm assuming we're talking about the conventional terminology. The IPO would have to be done through an investment bank, right? I wonder how much it costs to do that. And, would shares be open to the general public to purchase, or RC members only?