Hi there Westhouse Securities has today initiated coverage on Black Mountain Resources, a US focussed silver developer, with a BUY rating and a 23p price target which represents a 90% upside to the current price of 12p.

The Company is one of only two pure silver plays on AIM. The Company is due to commence production from two high grade silver projects, which between them have historic resources of 11Moz, in Q2 and Q3 within the historical mining districts of Montana and Idaho.

Rob Broke, the analyst at Westhouse, describes how "both New Departure and Conjecture have high historical resource grades which should keep unit production costs low, thus offering the potential for strong cash flow generation over the next few years.

Costs are anticipated to be circa $8-10 per oz at New Departure and circa $11 per oz at Conjecture.

These opex costs show strong resilience to changes in the silver price. Having already demonstrated the strong exploration upside potential available at the licences through drill programmes conducted at both projects, Black Mountain intends to recycle cash generated to help fund future programmes.

Both projects have returned high grades with up to 1,060 g/t returned near to surface at the Conjecture Project.

Westhouse also highlights the potential for very high grade mineralisation at depth at this project which offers further blue-sky: "the prospectivity of the underlying Revett formation also has the potential to host multi-million ounce deposits throughout the Ceour dAlene mining district." Best Lizzie
Black Mountain Resources* Buy from No Rec
Near-term, high-grade silver producer ________________________________ Black Mountain Resources (BMZ) expects to bring two silver projects into production during 2013 within the historical mining districts of Montana and Idaho.

Both New Departure and Conjecture have high historical resource grades which should keep unit production costs low, thus offering the potential for strong cash flow generation over the next few years.

BMZ offers the opportunity for investors to gain exposure to silver other than via the commodity itself and we initiate coverage with a Buy rating and 23p TP. [cid:image001.png@01CE3C3B.77485850]