Paramount Gold says no plans to sell San Miguel

TORONTO (BestGrowthStock) – Paramount Gold and Silver Corp (PZG.TO: ), has no plans to put its San Miguel property in Mexico up for sale after a rich strike in recent weeks caught the eyes of investors and its stock soared.

“We haven’t put the ‘For Sale’ sign on the lot,” Paramount Chief Executive Christopher Crupi told Reuters when asked if he would sell the property, but did not discount it altogether if the right price were to come along.

Paramount announced the discovery last week of a high-grade, gold-silver vein at San Miguel that is an extension of mineralization from the neighboring Palmarejo mine, owned by Coeur D’Alene (CDE.N: ) (CDM.TO: ). Palmarejo is expected to produce some 6.1 million ounces of silver and 109,000 ounces of gold this year.

The Paramount discovery sparked speculation that Coeur, a major silver producer, would make an offer to buy San Miguel, prompting its stock to jump 40 percent last week.

Crupi did not say if he had had talks with Coeur, but market players say the discovery at San Miguel should make it a target for anybody who wants build a consolidated mining district in the region.

“It wouldn’t surprise me if our neighbor was very interested in what we have, given they have built a huge facility to process ore next door,” said Crupi. “Why wouldn’t they want to buy their only neighbor. I mean, I would.”

Precious metals miners in Mexico, many of them Canadian-listed companies, are consolidating as gold and silver prices soar and larger companies seek to replenish their diminishing reserves.

Crupi said Paramount — which has C$28 million for operating expenses — has no plans for further acquisitions, preferring to develop San Miguel and its Sleeper gold mine project in Nevada.

He said those funds should take the company through another 2-1/2 years, and he does not expect to go to market to raise cash before that.

Paramount moved into the Nevada gold district in June with the acquisition of Canada’s X-Cal Resources (XCL.TO: ) in an all-stock deal worth C$32 million.

“What we’re attempting to do from a strategic point of view is to take our two projects and give as much leverage to gold as we can by building the number of ounces in those projects and riding the bull market in gold, which I can’t control,” said Crupi. “But I can control how fast I develop my projects.”

($1=$1.01 Canadian)

(Reporting by Pav Jordan; editing by Rob Wilson)

Paramount Gold says no plans to sell San Miguel