Please take a moment to look at the map of Precious Metal Mining in Mexico. You will notice that most Mexican gold mining takes place in the mid-central portion of the country. To date, very little mining activity has occurred in the Mexican state of Michoacan. If this is the case, why should we be excited that USPR is focusing their efforts here? First of all, there is a reason why Michoacan has had little mining activity. In 1985, Michoacan was devastated by an extremely powerful earthquake that damaged much of the region's infrastructure. Many of the roads to the Solidaridad mining properties were damaged by this event and subsequent years of neglect made access to these areas nearly impossible. For USPR, this was a blessing in disguise. The damaged roads hindering access to the Solidaridad mining properties have kept the area in pristine condition. While other areas of Mexico have been heavily mined, the minerals of the Michoacan Solidaridad region have been left alone.
(Damage from 1985 Michoacan Earthquake)
When USPR acquired the rights to the Solidaridad mining properties, they realized that in order to mine precious metals, roads and infrastructure to the sites would need to be repaired. In a February 15, 2007 press release, USPR noted "Existing roads on the concession have been repaired by a heavy equipment contractor from Morelia. There were an estimated 10 km of existing roads that needed repair. The rainy seasons in past years had washed out sections of the roads preventing vehicle access. Our intent is to access areas that are considered drilling targets and begin sampling vein structures for continued metallurgical testing." Additionally, in their most recent SEC 10QSB filing from 1/16/2007, USPR indicates that they are planning to spend $505,000 to repair/construct roads to Solidaridad I and improve the site's infrastructure to help facilitate future mining operations.
Based on its pure potential, USPR is an outstanding gold play. When you consider the fact that USPR is just about the last remaining gold stock that has yet to explode, your mouth should begin to water! Do you remember what I said about mimicry trading? Let's take a look at few other OTCBB Gold stocks and see how USPR measures up:
Capital Gold Corp. (OTCBB: CGLD) has $0 reported revenues according to their most recent SEC 10QSB filing and has a market capitalization of $59.9 million
Global Gold Corp. (OTCBB: GBGD) reported $5,600 in revenue according to their most recent SEC 10QSB filing and has a market capitalization of $30.2 million
Gold Resource Corp. (OTCBB: GORO) reported $0 revenue from operations (they did report $841 in interest income) according to their most recent SEC 10QSB filing and has a market capitalization of $61.3 million
Raven Gold Corp. (OTCBB: RVNG) reported $0 in revenue according to their most recent SEC 10QSB filing and has a market capitalization of $58.7 million.
Silver Dragon Resources (OTCBB: SDRG) reported $0 in revenue according to their most recent SEC 10QSB filing and has a market capitalization of $112 million.
The average market capitalization for these OTCBB Gold Mining companies is $64.4 million. If we apply this market capitalization to USPR, the company would have an amazing share price of $2.05! Far fetched you say? Why? None of these other OTCBB gold mining companies have reported any revenue for this year. What makes them different than USPR? The driving force behind each of these companies is potential. While CGLD, GBGD, GORO, RVGC, and SDRG have already risen based on their potential, USPR has yet to be discovered by the masses. When USPR is discovered by the masses, this stock could very easily mimic the rest of the OTCBB Gold Mining stocks.
The fact that USPR has already taken steps to build and/or repair access roads to their mining sites is encouraging. On top of this, on February 6, 2006, USPR appointed a new Chief Operating Geologist. Combine this with the fact that a survey contractor from Morelia has completed the first phase of surveying for the Solidaridad properties and you should be very excited. This portion of the survey provides an accurate base map of an area along the main access road and extends easterly to the edge of the mountains. The second phase of survey is planned to include the "main zone" of mineralization which lies within the mountains directly east of the main road and extends north-south.
According to USPR, a drilling campaign is currently being planned. The drilling consists of shallow drill holes, less than 100 meters, to better define the mineralized zones and provide mine planning data. A second strategy, drill holes less than 700 meters, is intended to explore for deeper targets. All drilling will consist of core.
Can you say potential? I knew that you could! USPR is one gold stock that is truly a diamond in the rough!