Comstock Mining Inc

Pure Comstock Silver Nevada Sesquicentennial Medallion This limited edition medallion commemorates Nevada’s Sesquicentennial and is the first substantial minting of Comstock Silver since the Carson City Mint closed in 1893.

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Comstock Mining Inc


Disclaimer:

Statements contained in this blog, which are not historical facts, including statements about plans, goals and expectations regarding businesses and opportunities, new or existing business strategies, capital resources and future financial results are "forward looking" as contemplated by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, including, but not limited to, changes in government regulation, generally accepted accounting principles, taxation, competition, general economic conditions and geopolitical conditions. Accordingly, actual results may differ materially from those projected or implied in the forward-looking statements.




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CEO Blog - July 14, 2014
Monday, July 14 2014 00:00
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COMSTOCK MINING WINS TOP SAFETY AWARD

On July 8, 2014, the Nevada Mining Association (NvMA) announced that Comstock Mining Inc. had been awarded a FIRST PLACE SAFETY AWARD for 2014!!

The Nevada Mining Association’s 2014 Safety Awards honor the individuals and operations throughout the mining industry dedicated to fostering a culture of safety throughout their mine site and supporting the industry-wide credo to send every mining employee home safe and healthy after every shift.

The NVMA Safety Awards are given annually to mine operators and individuals in several categories. Data for the 2014 awards are based on performance in the 2013 calendar year. Comstock Mining had no reportable, safety related accidents in 2013, and won a first place honor in the medium mine operations category, between 100-299 employees.

Comstock Mining Safety Director Randy Harris attributed the award to a Company culture that placed “the safety of our people and the protecting of the environment first, from day one, even before production started up.” The tone at the top and throughout the Company prioritizes the safety of Comstock’s employees and stakeholders in the work place and the protection of the environment and the Landmark.

“We work diligently to insure the safety of our employees and that of the surrounding communities” Harris says, “We have also been proactive in developing a knowledge based relationship with the Mining Safety and Health Administration, (MSHA) and all of our state and local emergency management personnel.”
“This year’s honorees have spent the last year teaching, drilling and applying best practices related to safety on the mine site, and it’s time to pay tribute to their dedication to safety,” said Tim Crowley, NVMA president. “Every single employee on a mine site plays a pivotal role in ensuring Nevada mines are safe. These awards recognize those companies and professionals that stand out above all others.”

This year, 27 awards will be given to mine operators and 44 awards will be given to individuals during an event at NVMA’s annual convention in Lake Tahoe on Saturday, Sept. 6th.

 
CEO Blog - June 11, 2014
Wednesday, June 11 2014 12:54
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KEYSTONE MINE RECLAIMED

Comstock Mining Inc. is giving the old Keystone Mine back to Mother Nature.  It is the first major reclamation project for Comstock Mining, Inc.  The Keystone surface mine has been completely filled in, contoured, and then covered with growth media.

 

Pictured is the site being landscaped with rock to imitate outcroppings.

 

In October, it will be hydro seeded with native plants and shrubs just in time for the winter moisture.

 

Conceptual Keystone Mine site post reclamation


The Keystone project is an example of Comstock’s concurrent mining and reclamation procedure where it mines one area while reclaiming another.

 

 

 
CEO Blog - April 30, 2014
Wednesday, April 30 2014 14:22
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vwphoto-iair-award

 

Comstock Mining Recognized As:

“Best Company for Leadership – Gold & Silver Mining - USA”

 

iair logo

 

To our Entire Comstock Team and extended Community:

Our entire community –based team, county and statewide, courageously leads and promotes breakthrough innovations in mining, reclamation and restoration, specifically by promoting a culture of continuous learning, wealth creation and a genuine integration into our communities, despite significant resistances and obstacles. It is for this reason on April 15, 2014, Comstock received the IAIR Award for “Best Company for Leadership – Gold & Silver Mining - USA.” I am not surprised a Nevada-based community, especially from the Comstock, won this award.
IAIR® honored Comstock Mining with this leadership award amongst American miners…“for its important role in the Gold and Silver Mining in the Comstock District of Nevada since 2003. Thanks to its operating model and its understanding of the geology of the area, Comstock Mining was able to bring its exploration project into production.”

The award was presented at the IAIR award ceremony held at the Yale Club in New York, NY.
IAIR AWARDS® is one of the world's leading ranking and prizes for excellence in global economy and sustainability. It is made up of the scientific committee of IAIR® and IAIREVIEW.org along with a team of dedicated legal, economic and financial journalists in over 120 countries worldwide.

The IAIR AWARDS® is focused on the Global Economy and Sustainability and in particular in the following categories: Green Economy, Leadership, Alternative Investments, Business Opportunities, Global Corporate Excellences, FX, ETFs and Commodities, Law, Asset Management, Family Office and Wealth Management, Philanthropy, Private Equity, Real Estate and Property, Succession Planning and Family Businesses.

Some of our past winners and top ranked companies include: FedEx, Rothschild, ABB, 3i Group, Aviva, Vodafone, Christian Dior, Cartier, Morgan Stanley, Bank of China, Rockefeller, BNP Paribas, IBM, HDFC Ergo, Freshfields, UBS, Novartis, BlackRock, Deutsche Bank, Russel Investments, ReMark, BASF, Daimler, Royal Dutch Shell, APAX Partners, Bridgepoint Capital, Allen & Overy, Willkie Farr & Gallagher, DLA Piper, and CMS.

I would like to congratulate the entire Comstock team for its caring patience, courage, persistence, wisdom and absolute will to make the Comstock an even more amazing and better place. These are the leadership qualities that have enabled these advancements and I want to thank each and every one of you personally.

Sincerest and kindest regards,
Corrado DeGasperis
President & CEO

 
CEO Blog - October 9, 2013
Wednesday, October 09 2013 11:42
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Comstock Mining Hosts Students from UNR

Comstock Mining hosted 11 graduate and undergraduate students from our local university along with their professor, Tommy Thompsen, for a detailed tour and lecture of the Lucerne and Dayton resource areas on Comstock Lode late last week.  

The University of Nevada Reno (UNR) geology students met at the Company’s Gold Hill Hall, on Gold Hill, Nevada, for a presentation by Mr. Larry Martin, the Company’s Chief Geologist and Jason Merchant, its Cartographer.  The students were engaged, inspired, and thoughtful as they listened to the story of Comstock’s history and plans for the future.  At the end of the presentation, these future geologists kept Larry on his toes as they asked a full range of questions, from the expected to the quite challenging.

unr-geology-students-gatehered-at-the-dayton-adit-web

Like many of the tours the Company has offered throughout the year, students were presented a view of the Lucerne Resource Area with fellow student and mine geologist, Ken Coleman, offering his take on the mine.  The scholars listened intently, evaluating the geology and taking pictures.

taking-notes-at-the-lucerne-web

However, this was a less than typical tour; the students were taken to the Dayton Consolidated Mill area for a more “hands-on” learning experience.  As soon as they unloaded from their van, they became geologists; with chisels, sample bags, and a desire to find gold, they scoured the hills.  For almost two hours they picked up rocks, discussed them, compared them and withstood the wind.

students-exploring-at-dayton-web

We all enjoyed the day and always seem to have a great time on The Comstock.

 

 

 
CEO Blog - July 2, 2013
Wednesday, May 08 2013 12:35
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Q: You have mentioned the “Chute Zone” in recent communications and I understand it was a topic of discussion during last week’s Annual Meeting. What are the real implications of this discovery?

A: Thank you for the question. The Chute Zone is one of the most substantial and significant findings in our most recently published NI 43-101 Technical Report (the “Report”).

Overall, the Report, published in January 2013, declared a mineral resource estimate of Measured and Indicated Resources containing 1,824,000 ounces of gold and 17,100,000 ounces of silver, for a total of 2,150,000 gold equivalent ounces[1], and an estimate of an Inferred Resource containing an additional 870,000 gold equivalent ounces. The Report also includes an additional 200,000 gold-equivalent ounces outside of the modeled area, in the Historical Resource Category.

Since 2008, the Company’s geologists have recognized the enhanced grades of precious metals when northeasterly striking mineralized structures intersected the Silver City fault zone. We have now identified a specific, wedge-like, structurally bounded zone that hosts significant gold and silver, that we are calling the ‘Chute Zone’.

Comstock geologists believe that the structural intersection and geometric shape of the Chute Zone is similar to highly mineralized zones that were historically mined in the Comstock District as bonanzas (that is, the 1878 definition of bonanza grade ore: > 0.5 ounces of gold per ton and 10 ounces of silver per ton). There were 33 mined bonanza ore zones located along the Comstock mineral belt. The historic production records relating to these bonanza deposits account for most of the 8.2 million ounces of gold and 192 million ounces of silver produced during 1859 thru 1962 from the world class Comstock Mining District (Bonham,H.F., and Papke, K.G.,1969). See a summary of the Principal Bonanza Deposits of the Comstock Lode below.

20130702-Principal-Bonanza-Deposits-by-R.-Carrington    

(Principal Bonanza Deposits by R. Carrington)

Further regarding the Chute Zone, Behre Dolbear stated, “this intersection zone hosts elevated grades of gold and silver that consistently average 0.095 ounces of gold per ton over drill intercepts of 45 to 270 feet and has mapped dimensions of 100 to 150 feet by 100 feet by 450 feet”(p. 4). Although early in its development, and still open to further resource development on most sides and at depth, the Chute has already quantified almost one-half a million tons of mineralized material. The following picture shows a map draped over topography, showing the historic Justice (top left, in green), historic Woodville (top center, in green), & the Chute (center stage, in gold) zones in plan view.

 20130702-Map-Draped-over-Topography

Geology Map Draped over Topography

The following picture depicts the same Chute Zone (yellow) in 3D:

 20130702-Chute-Zone-Looking-West

 

The following table 7.2 (extracted from the January, 2013 NI 43-101, Behre Dolbear) lists selected drill hole intercepts located within the Chute Zone.

 20130702-Chute-Zone-Drill-Assay-Highlights

(Selected Chute Zone Assay Results)

 

The next pictorial is a scale-to-scale, looking west, cross sectional view of the historic Con Imperial Bonanza (far right, blue shape), Crown Point Bonanza (lighter blue shape, left and deeper than the Con Imperial) and the Belcher Bonanza (blue shape, farther left and deeper than the Crown Point Bonanza) after R.G. Carrington (2003 & 2011).

These historic mine shapes of the northerly-located bonanza deposits illustrated by the upper cross section are compared in a lower cross section that depicts mined geometric shapes of the historic Justice and Woodville (southern most bonanza mined on the Comstock mineral belt) and the Chute Zone as depicted by our geologists and extended engineering teams.

 20130702-Bonanza-Comparison

This comparison shown above was chosen to display the perceptual similarities of dip angle and spatial distances between each of the selected historic Comstock bonanzas (Con Imperial, Crown Point and Belcher) to the near perfect correlation to the dip angle and spatial distance separating the Justice (far right green shape lower cross section), Woodville (positioned left and deeper than the Justice) and Chute Zone (colored yellow). The red coloring on the drill holes of the lower cross section represent assay values equal to or greater than 0.05 ounces of gold per ton. The green shapes are stopes of historic mined zones.

The Woodville shaft operated in the Woodville bonanza zone from 1872 to 1875. During this time, 7076 tons of material were mined, as documented in “Nevada' Metal and Mineral Production 1859 thru 1940.” The specific dimensions that we believe represent the Woodville bonanza were estimated by reviewing the historic underground workings, giving us a volume of approximately 25 feet by 25 feet by 150 feet. The reported production from just over 7,000 tons of material was almost $8 million of gold and silver equivalent, in today’s dollars.

When you consider that the current mining operation sends approximately 4000 tons a day to the crusher (slightly over half the volume of the Woodville bonanza), you can appreciate the enthusiasm of the geologic team, that this Chute Zone, a highly mineralized structural intersection, could host a similar bonanza grade pocket with in an already defined, larger resource.

The discovery of the Chute Zone is the result of many months of hard work, drilling, analysis and interpretation by the geological team. The geologic team hopes to gain a deeper understanding of the controlling geologic attributes of the Chute Zone, allowing for even more efficient identification of such structures in future exploration campaigns along the Comstock.

As Behre Dolbear concludes in the exploration developments section: “Based upon the structural controls of the newly discovered higher-grade Chute zone, CMI has recognized structural similarities in higher-grade zones at Dayton and other mineralized areas within the CMI property position. Expectations are high that further drilling at the appropriate azimuth will allow for important extensions to these higher-grade zones” (Behre Dolbear, 2013, Technical Report on the Comstock Project, p.49).

The team is currently assessing how best to mine this ore body, as it represents the first real opportunity for an underground development. We have already asked our engineers and consulting engineering firms for conceptual designs of underground mining options, as shown below.

 20130702-Conceptual-Decline-Designs

(Conceptual Decline Design)

The primary goal of the 2012 drill program was definition drilling for the mine plan. Discovery of the East-side Chute Zone represents the potential for an expanded mine plan and potentially, an underground mining target on the Comstock. We will be working diligently to assess the economic parameters for making this exciting discovery part of a tremendous expansion for our mine planning and operations. The Chute Zone discovery and development is tremendously rewarding for our team. Quantifying such a significant resource, on just a fraction of our land position, provides us with significant confidence in the long-term future of the Lucerne Mine and our overall resource goals.

Best Regards from the Comstock,

Corrado De Gasperis

President & CEO



[1] Gold equivalent ounces were calculated using January 31, 2013 London PM prices of $1,664.75 per ounce of gold and $32.03 per ounce of silver, as published by kitco.com. This resulted in a ratio of 51.97 ounces of silver per equivalent ounce of gold, without taking into consideration the relative recoveries of gold and silver. The Company’s current estimates for heap leach recovery are 70% for gold and 45% for silver.

 
CEO Blog - May 8, 2013
Wednesday, May 08 2013 12:35
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Production run rates exceed plan and have been achieved faster than scheduled

Question: What is the status of the short-term production goal of 400 gold-equivalent ounces per week?

Answer: I am extremely pleased to report that we have well exceeded our targeted production rate of 400 ounces per week, and achieved this rate of production ahead of schedule! Originally scheduled to exceed 400 ounces by late April, we poured 408.17 gold equivalent ounces during the week of March 17 – 23, 2013. For the next five weeks (six total) ending April 27th, we sustained a throughput averaging over 425 ounces per week. We continue improving the stability and throughput of the system and will operate at or above these levels for the rest of 2013.  We anticipate achieving the full 20,000 gold equivalent ounces this year (as compared to previous guidance of between 18-20,000 gold equivalent ounces).

Along with the pouring of gold and silver, every aspect of the production system has been stabilized or enhanced for predictable, sustainable growth. These photos demonstrate the increased rate of material placed on the heap:

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  Photo of Heap: November 6, 2011  

 

heap-nov2012

 Another photo of the heap from November, 2012

 

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  Photo of Heap: January 3, 2013

 

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  Photo of the Heap: April 11, 2013; notice the completed left side of the first lift, or level.

 

heap-apr112013b

  Another photo of the Heap from April 11, 2013

Just in the month of April we crushed and stacked over 30% more material when compared to March.  The Company is continuously adjusting its operations to improve grade, maximize yields and increase tons crushed and stacked.

During the first quarter of 2013, we completed the ramp up and stabilization activities of the production system, including improvements to the hauling, crushing and metal extraction processes.  

lucerne-apr132013

Photo: Mining from the Lucerne, April 13, 2013

 

lot51haulroad

  Photo: Hauling through “Lot 51” from the mine to the processing area in American Flat

Metal sales in the first quarter of 2013 totaled $4.2 million, with gold revenues of $3.7 million. We also produced $0.5 million of silver. Silver is accounted for as a by-product credit in costs applicable to mining revenue for financial reporting purposes. During the first quarter of 2013, the Company crushed and stacked over 234,000 dry tons of mineralized materials and shipped 2,261 ounces of gold and 15,599 ounces of silver.  Material placed on the heap leach pad remains under solution until recovery rates are optimized.   Although the daily throughput will vary depending upon the amount, type and grade of material placed on the heap and the stage of leaching of that material, the weekly average of 425 ounces reported above extends over sufficient time to demonstrate a meaningful and sustainable shift upward in our production.

The current financial analysis for the Lucerne Mine anticipates annual operating expenses, including all mining and processing costs of approximately $15.9 million per annum, excluding approximately $1 million of additional haulage costs, with an anticipated production schedule currently processing at the rate of one million tons per annum, but also including plans for ramping up to a 1.5 million tons per annum run rate.  Mine administration costs are anticipated to be approximately $1.5 million. The Company currently anticipates production rates staying beyond the 400 gold-equivalent ounces per week in the second half of the year with a current expectation of producing 20,000 gold-equivalent ounces in 2013.   The first quarter of 2013 brought our mining and processing systems into stability, enabling us to invest in future production and resource growth and accelerate the complete repayment of our secured Auramet Debt Facility, most likely well ahead of schedule.

A reminder about the Quarterly Conference Call

As previously announced, I will host a conference call on Thursday, May 9, 2013 at 8:00 a.m. Pacific Time/11:00 a.m. Eastern Time to report First Quarter 2013 results and business update.

The live call will include a moderated Q&A, after the prepared remarks.  The dial-in telephone numbers for the live audio are as follows:

North American Toll Free: 1-866-544-4625

Canada Local / International: 416-849-2726

 

Best Regards from the Comstock,

Corrado De Gasperis

President and CEO

 
CEO Blog - May 2, 2013
Thursday, May 02 2013 09:26
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First Judicial District Court rules in favor of Comstock Mining and Storey County

Question: What is going on with this lawsuit by the CRA against the County? 

Answer: Last week, we received notice from the Court that CRA’s complaint and petition for injunctive relief were denied in conjunction with the summary judgment order issued in favor of the County and the Company.  We could not be happier with the decision and frankly, never considered this action as anything other than a moot, frivolous action on the CRA’s behalf. 

On April 24, the First Judicial District Court issued its order on the cross motions for summary judgment.  The court determined that Storey County did have the authority in 2004 to impose a condition in the SUP that the Company not use Highway 342 for hauling ore from the mining area to the processing area.  The CRA considers this a victory but so should the County.  However, more substantively, the court also held that the Storey County Commission properly amended the SUP to eliminate the “no haul” provision relying on proper factors.  This was our main, most relevant argument.  As such, Storey County and the Company were granted summary judgment on the issue.  The court denied the CRA an injunction precluding the Company from using the highway to haul ore. Regardless, we are not currently using the highway to haul ore.

In the meantime, we have been ramping up production, using our quite excellent haul road, and I very much look forward to providing a full update on our operations next week, on Thursday, May 9. 

Best Regards from The Comstock,

Corrado De Gasperis

President and CEO

 

 
CEO Blog - April 29, 2013
Monday, April 29 2013 13:30
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COMSTOCK MINING SPONSORS HEALTH AND SAFETY WEBINAR SERIES

I am pleased to announce that Comstock Mining, Inc. is an official co-sponsor for the Spring, 2013 Mining Health and Safety Webinar Series being conducted by the University of California, Berkeley’s Center for Occupational and Environmental Health (COEH), a NIOSH-designated Education and Research Center.   

For mining and the related activities that serve them, effectively protecting our employees’ health and ensuring that our operations are well in compliance with applicable MSHA/OSHA/ State/Territorial regulations and corporate policies is essential to sustainability, profitability, and growth. To optimally accomplish this vital task, Health and safety officers, facility and laboratory managers, industrial hygiene and safety consultants, regulatory officers, and others need information and tools and information that reflect state-of-the-art knowledge application.  

The Mining Health and Safety Webinar Series provide highly informative, one-hour courses taught by UC Berkeley’s leading researchers and professionals in the field of health and safety. The courses provide practical technical information and practices that optimize methods for measuring, controlling, evaluating, and monitoring important hazards that impact employees in mining and laboratory operations. Continuing education credits and Certificates of Participation are available for all attendees.

The series of courses begin May 16th. Registration information and course descriptions are available at www.coehce.org and we have posted a PDF of the brochure on our website which can be downloaded here (3.71MB PDF).

I encourage anyone interested in supplementing their knowledge in this most important field to sign up for one of these courses of the entire series.

Best Regards from The Comstock,

Corrado De Gasperis

President and CEO

 

 
CEO Blog - February 26, 2013
Tuesday, February 26 2013 00:22
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COMSTOCK MINING POSTS FULL NI 43-101 TECHNICAL REPORT

LUCERNE M&I INCREASES 25%, WITH NEWLY DISCOVERED CHUTE ZONE

 

Q: When do you anticipate posting the full NI 43-101 Technical Report?

A: Thank you for the interest. We just made available today the full text of our fourth National Instrument 43-101 technical report (the "2013 Report") authored by Behre Dolbear & Company (USA), Inc. of Denver Colorado. The 2013 Report has been posted to our website at: http://www.comstockmining.com/properties/technical-reports

The Report declared a mineral resource estimate of Measured and Indicated Resources containing 1,824,000 ounces of gold and 17,100,000 ounces of silver, for a total of 2,150,000 gold equivalent ounces1, and an estimate of an Inferred Resource containing an additional 870,000 gold equivalent ounces[1]. These estimates include the Chute Zone, recently identified in late 2012. The Report also includes an additional 200,000 gold equivalent ounces outside the modeled area, in the Historical Resource Category.

The technical advancements of this project, as detailed in this Report, are remarkable from both a quantitative and qualitative perspective, including exploration discoveries, positive metallurgical characteristics, refined geological interpretations, overall geologic model enhancements and significant progress on mining and processing. I was both satisfied and proud of our team when reading the 2013 report, including the following excerpts by Behre Dolbear:

“The author believes the Comstock Mine Project represents a well-explored, epithermal, precious metal deposit within a world-class mining district… The geology of the project area is well described and understood through vigorous surface mapping and drill hole logging. The density of geologic data is high, and the reliability is excellent, particularly in the various Lucerne Mine areas.” (page 9)

“Due to its bonanza grades and major production of gold and silver ores,…the world-class Comstock District is well represented in the geologic literature… Nonetheless, as CMI continues its detailed exploration mapping, close-spaced drilling, and initial mine production, new details have emerged that have significantly influenced the understanding of the local and regional geology.” (page 21)

“Where the northeast striking faults intersect the Silver City fault zone, mineralization thickens and grade increases.” (page 4)

“A significant discovery of higher-grade mineralization, termed by CMI geologists as the Chute zone, was discovered through the East Side drilling in 2012… This intersection zone hosts elevated grades of gold and silver that consistently average 0.095 ounces of gold per ton (3 g/t) over drill intercepts of 50 to 270 feet and has mapped dimensions of 100 to 150 feet by 100 feet by 450 feet.” (page 4)

“Based upon the structural controls of the newly discovered higher-grade Chute zone, CMI has recognized structural similarities in higher-grade zones at Dayton and other mineralized areas within the CMI property position. Expectations are high that further drilling at the appropriate azimuth will allow for important extensions to these higher-grade zones.” (page 49)

“Substantial resources have been identified to the south at the Dayton property and encouraging exploration results have been received at Spring Valley,…” (page 5)

“The current calculated metallurgical recoveries are approaching the predicted gold recovery and have exceeded the predicted silver recovery. The portion of the heap under leach for the longest, 80 days, has the recovery of gold estimated at 67% and the recovery of silver is estimated at 51%. Preliminary laboratory metallurgical test results provide CMI confidence that ultimate heap leach recoveries will meet or exceed the predicted 70% for gold and 45% for silver.” (p. 127)

“The author further verified that the average gold and silver grades summarized for the Lucerne resource table (0.030 ounce per ton and 0.286 ounce per ton, respectively) and CMI’s forecasts of future operating costs should result in a strong profit margin for the Lucerne Mine operations at current metal prices.” (page 8)

“Forecast operating costs were also compared with the very preliminary results from the first three months of actual operations, and are considered by the author to be in reasonable agreement.” (page 8)

Although the primary goal of the 2012 drill program was definition drilling for the mine plan, discovery of the East-side Chute Zone and the 25% increase of Measured and Indicated Resource in Lucerne from the Company’s previous NI 43-101 dated September 2011 (at a discovery cost of $13.15 per ounce) highlight the additional results.

This Report lifts our project into another category of achievement. When ranked against all the 1 million-plus gold deposits in the world, only 439 such deposits are identified in the world and only 189 of those are producing, putting us in an outstanding peer grouping.

See also NRH Research – 2012 Ranking Gold Mines & Deposits: http://nrh.co.il/s/research.asp

Best Regards from The Comstock,

Corrado De Gasperis

President and CEO



[1] Gold equivalent ounces were calculated using January 31, 2013 London PM prices of $1,664.75 per ounce of gold and $32.03 per ounce of silver, as published by kitco.com. This resulted in a ratio of 51.97 ounces of silver per equivalent ounce of gold, without taking into consideration the relative recoveries of gold and silver. The Company’s current estimates for heap leach recovery are 70% for gold and 45% for silver.

 
CEO Blog - January 4, 2013
Friday, January 04 2013 00:00
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Question: Please explain the two S-3 registration statements filed with the SEC on December 31, 2012. What do they mean and are any further actions planned?

Answer: The Company filed two S-3 registration statements on December 31, 2012. The first was a typical shelf registration statement covering up to $50 million of broad categories of securities, both debt and equity. The Board believes that it is prudent for a company to have the capability to access the capital markets on a timely basis, to be better prepared for any unforeseen contingencies that may arise as well as take advantage of opportunities that may become available. The Board believes that this is especially true for the Company, as it expands and enhances it production activities and uses capital resources in connection therewith. The Company does not have any present arrangement or understanding with respect to raising additional capital.

The second was a registration statement to register the resale of the common stock underlying the Series A-1 Convertible Preferred Shares held by the Winfield Group, which the Company was obligated to file pursuant to a previously disclosed agreement between the Company and its preferred shareholders (including the Winfield Group) signed in connection with the Company’s recapitalization in October 2010. While the registration of the common stock underlying the preferred shares held by other preferred shareholders was completed in 2011, the registration of the underlying common stock for the Winfield Group was deferred, with the Winfield Group’s consent, at the request of the Company, several times since then. The Winfield Group believes that, given the size of its holdings in the Company and the importance of those holdings to it, it is prudent to have the Company comply with its obligations under that agreement. While there is no current contractual restriction on the Winfield Group’s ability to convert their preferred shares into common stock and resell them, it has never done so and has advised the Company that it has no current plans to do so.

The registration of the resale of the common stock underlying the Series A-1 Convertible Preferred Shares held by the Winfield Group is not dilutive. The Company currently has 48.5 million common shares issued and outstanding and 109.9 million common shares on an if-converted basis, that is, if all preferred stock was converted to common stock (including the common stock underlying the Series A-1 Convertible Preferred Shares held by the Winfield Group). Investors should keep in mind that, when any preferred shareholder converts preferred shares into common stock, all rights to a liquidation preference and future dividends payable on the preferred shares are given up (reducing the Company’s obligation with respect thereto). In the Winfield Group’s case, they would also be giving up their super voting rights (5 votes for every 1 underlying common share). The registration of the underlying common shares does not mean that these preferred shares will be converted, or if converted, that they would be sold.  Again, the Winfield Group has advised the Company that it has no current plans to do so.

Best Regards from The Comstock,

Corrado De Gasperis

President & CEO

 
CEO Blog - December 4, 2012
Tuesday, December 04 2012 14:22
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COMSTOCK MINING VISITS FOR CAREER DAY AT
SILVERLAND MIDDLE SCHOOL IN FERNLY, NV

CEO-Blog-120412-Picture32
Silverland Vaqueros Mascot

Comstock Mining’s President and CEO, Corrado De Gasperis, was invited to present at the Silverland Middle School in Fernley, Nevada, by Assistant Vice Principal Barbara Harris to discuss some of the exciting history, innovation and potential for Nevada careers in the gold and silver mining industry.

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Silverland Middle School, Fernley, NV
School Archive Photo

This beautiful new school was constructed in 2011 with 97,520 square feet to house a growing need for young learners in Lyon County.

“Completed in January, 2011, Silverland is LCSD’s newest building and the prototype for future construction projects. Green technology, such as wind and solar energy, compliment design features that allow maximum sunlight into classrooms. High-efficiency lighting, room occupancy sensors, and low-flow water fixtures help reduce the carbon footprint of the facility,” advises Principal Ryan Cross.

As over 500 local 7th and 8th graders filed into the school’s gymnasium and took their bleacher seats, they offered up their resounding ‘go time’ signal, a staccato two-clap & stomp designation that settled the Vaqueros to attention. Introduced by Patrick Whitehead, 8th grade Social Studies teacher, the assembly was reminded that about 20% of Nevada’s state economy is derived from mining and that it is likely that someone they knew or that possibly their parents, grandparents or even great grandparents had worked in some area that was connected to mining. Mr. De Gasperis then engaged the students in discussions about the physical properties of gold and silver, some surprising uses of these precious metals, and modern careers supported by the gold and silver production.  

Gold bullion is a global financial stabilizer, currently held in physical gold bars in world banks.  While some gold goes into the jewelry industry, gold has many different uses.  Gold is a highly efficient electrical conductor that can carry tiny currents and remain free of corrosion. It is used in high-end components in airplane engineering, cell phones and global positioning units.  It is extremely malleable and experts contend that a single ounce of gold can be pounded and pulled into a very thin string, up to 35-miles long or into a 300 square foot sheet. Gold is also used in environmental or ‘clean green’ chemistry to help purify, reduce and eliminate hazardous substances.  Gold is also used in cancer treatment, dental and other medical applications.  

Nevada’s historically rich Comstock Lode has produced over 8 million ounces of gold, but its biggest claim to fame has been its unique high-grade silver deposits, that historically produced almost 200 million ounces of silver in the late 1800s, financially supporting the Union in the Civil War, accelerating Nevada’s admittance into the Union as the 36th State on October 31, 1864, and accordingly nicknamed the Silver State.

Silver is also used in the Jewelry Industry but has many other industrial applications.  Silver is also one of the most conductive metals and the vast majority of silver today is used and consumed in electronics, space and aeronautical engineering and the medical industries.

The Silverland Middle School students were exceptionally attentive to the presentation and the videos on the origin of gold and the history of mining on the Comstock Lode, led by Mr. De Gasperis. They asked wide-ranging questions about all aspects of mining and The Comstock.

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Photo by Julie Draksler

The photo below shows Mr. De Gasperis presenting a short video on the important contributions that engineers made to mining on the Comstock Lode in the 1880s.  Cave-ins were deadly and prolific due to the unsupported soil found in the unique geography of the Comstock Lode.

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 Photo by Julie Draksler
Projected on the screen is a schematic of the most innovative solution; the honeycomb construction of German engineer and mine superintendent Philip Deidesheimer, who invented the square set timbering method. In this method, timber latticework was used to support the tunnels to prevent the cave-ins of the soft volcanic sand.  Hot springs brought water temperatures inside the mines to 120° Fahrenheit and periodically flooding shafts.  Adolf Suttro built a large drainage shaft under the northern end of the Comstock Lode that eventually helped drain off the deadly hot floodwater, released built up steam pressure and it still drains water today.  Other inventions created to support mining on the Comstock Lode include the lumber transport V-Flume, an 11-mile long water slide that extended from Spooner Summit down Clear Creek to Carson Valley.  The Virginia and Truckee Railroad hauled the wood up to the Comstock to support the mines, build homes, businesses, and firewood. Another critical invention, the modern Merrill-Crowe process that eliminated the need to use poisonous mercury for metals extraction was refined on the Comstock.  One of the earliest applications of the Merrill process, in the early 1900s, was right in Silver City at the Donovan Mill.

The Comstock Lode of the late 1800s and its quickly populated towns of Virginia City, Gold Hill, Silver City and Comstock City, were home to tens of thousands of miners and their families and supporting mercantile, train stations, and ore haulers as well as construction workers, engineers, architects, actors, writers, and artists.  

“We are really excited to have Mr. De Gasperis take time and visit our school and talk to our students,” said John Galahan, 7th grade Science Teacher.  “It is a close part of their history and a good look at a working career opportunity.”

Comstock Mining restarted gold and silver production on the Lode in August this year and reports an overall resource of over 2.3 million ounces of gold and over 24 million ounces of silver.

I greatly enjoyed presenting to the Silverland Middle School Career Day and appreciate the student and faculty interaction.  

Best Regards from The Comstock,

Corrado De Gasperis

President & CEO

 
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