History
A silver-zinc explorer that merged, raised money repeatedly and signed a big partner for Sierra Mojada, then saw the project blockaded and turned to arbitration against Mexico.
2006-2010: Funding Sierra Mojada and the Dome merger
The company began as Metalline Mining Company, an explorer focused on the Sierra Mojada project in Mexico. In March 2006 it closed an $11.2 million private placement of 13.95 million shares at $0.80, with five-year warrants attached, sold to 148 accredited investors. In November 2006 the American Stock Exchange certified its securities for listing, and in June 2007 it adopted a shareholder rights plan, an anti-takeover defence that triggers if anyone acquires 20% or more without board approval.
In July 2008 a new resource model more than doubled the estimated zinc at Sierra Mojada. The company suspended its underground mine plan and the concentrator portions of its feasibility study to evaluate a larger-scale operation. But by May 2009 NYSE Amex warned that it no longer met listing standards because of inadequate stockholders' equity and sustained losses, and gave it until June 2009 to submit a compliance plan.
The answer was a merger. In December 2009 Metalline agreed to buy Dome Ventures Corporation, which held mineral properties in Gabon, issuing about 47.7 million shares. The deal depended on Metalline raising $2.99 million and Dome raising $13.01 million. Metalline closed its $2.99 million placement (6.5 million units at $0.46) on 24 December. A joint prospectus filed in January 2010 included a new Canadian-standard inferred resource estimate for Sierra Mojada. The merger completed on 21 April 2010, with Dome shareholders receiving about $60.1 million of Metalline stock. The board grew to seven, and Dome's chief executive, Brian Edgar, became Executive Chairman. In August 2010 the shares also began trading in Toronto, alongside the NYSE Amex listing. Shares on issue stood at about 105.9 million at the end of 2010.
2011-2015: Renamed Silver Bull and still raising money
Now called Silver Bull Resources, the company released a technical report in October 2011 on the Shallow Silver Zone at Sierra Mojada: about 28.6 million tonnes at 50.4 grams per tonne of silver in a potential open pit, plus higher-grade underground material at 110.9 g/t. In December 2011 it sold 15.05 million shares at $0.50 for $7.5 million, mainly for drilling and metallurgical testing. Shares on issue rose from about 105.9 million at the end of 2010 to 136.2 million at the end of 2011.
In February 2013 it launched a $9.1 million public offering of shares and warrants through PI Financial, Stifel Nicolaus Canada and Roth Capital Partners, again for Sierra Mojada work. Shares on issue reached about 159.1 million by the end of 2013.
In June 2015 the company's securities were notified for removal from listing and registration on its exchange. The next day it released an updated report drawing on over 1,300 drill holes and more than 9,000 channel samples: about 56.8 million tonnes at 50 g/t silver and 3.4% zinc in an optimised pit, plus a smaller high-grade underground zone at 9.4% zinc.
2016-2019: South32 and the blockade
The record for 2016 and 2017 is quiet, though shares on issue rose to about 199.3 million by the end of 2017. In June 2018 Silver Bull signed its largest-ever partnership: global miner South32 could earn up to 70% of Sierra Mojada by funding at least $10 million of exploration over four years, and up to $100 million to fully exercise the option. In July 2018 the company raised $2.83 million by selling 21.78 million units at $0.13, with a Sprott-managed fund taking 8.1 million units. In November 2018 a new estimate, superseding the 2015 report, put the resource at about 70.4 million tonnes at 38.6 g/t silver and 3.4% zinc in an optimised pit.
Then a cooperative of local miners, Mineros Norteños, blockaded the site and halted all work. In October 2019 Silver Bull declared force majeure, meaning the contract was suspended by events outside its control, on the South32 agreement. The cooperative holds a capped 2% production royalty on part of the deposit and had been suing the company over it since 2014. Share counts fell from about 234.9 million at the end of 2018 to 29.5 million at the end of 2019; the beats do not explain this.
2020-2025: Arras, South32's exit and arbitration
With Sierra Mojada stalled, Silver Bull looked elsewhere. In August 2020 it took an option on the Beskauga copper-gold property in Kazakhstan from Copperbelt AG and its subsidiary Dostyk LLP, paying $30,000 upfront and committing to staged spending of up to $15 million over four years. In November 2020 it raised $1.7 million (3.62 million units at $0.47), with directors, the chief financial officer and the chairman's affiliate buying $390,100 of it. Its subsidiary Arras Minerals Corp., formed to hold the option, raised C$2.52 million of its own in April 2021. In September 2021 Silver Bull spun Arras off, distributing about 34.3 million Arras shares to its shareholders one-for-one.
In September 2022 South32 terminated its option after about three years of force majeure, paying Silver Bull $518,000 and releasing all claims. In September 2023 the company secured up to $9.5 million of litigation funding from Bench Walk 23P, L.P. to pursue an arbitration claim against Mexico over the blockade. In return Bench Walk would receive up to 3.5 times its outlay, or its outlay plus 30% of proceeds. Shares on issue were about 47.4 million at the end of 2023.
As of the latest beat, in September 2023, Sierra Mojada remained blockaded, South32 had gone, and the arbitration claim against Mexico was the company's main path forward.
Written from the 26 story beats below (2006 to 8 Sept 2023), which come from the company's own announcements and filings.