To our Shareholders and Investors

 

We have just announced a shipment of high grade (some would say Bonanza grade) silver mineralization to Mineral Solutions of Coeur d Alene, Idaho. BHS2019-03

 

This mineralization was taken directly from the Big Dog zone vein and was not upgraded in any way, and demonstrates why the 43-101 has such a high average grade. The 150 kg sample, that graded 303 oz/ton silver, if there are no losses in recovery, contains 40 oz of silver.

 

Why have we done this?

 

We are getting a price comparison between sending direct shipping material overseas to smelters, and processing and refining silver directly from our concentrate. All the numbers indicate so far that it is a better option for us cost wise. We just want to make doubly sure at this exciting stage. Refined silver has a ready market and is far simpler to sell, and eliminates a lot of logistics and timing issues.

 

We have also announced a C$0.10 financing to raise C$750,000, in part to fund this program. With the assay results, the program is nearly halfway complete, with refined silver from the recent samples provided to Mineral Solutions expected to be produced towards the end of February.

 

In the event the process is proven cost effective, the Company will ramp up concentrate deliveries to Mineral Solutions and increase concentrate deliveries as we ramp up to full production of refined silver

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Two Dollars In Two Months

 

We are finally seeing some light at the end of the precious metals tunnel that is not an oncoming train. Is the recent 8 month nuclear winter in precious metals prices over? We certainly do not have a crystal ball, but it looks promising, and with all the pundits banging the drum for rising prices, it looks like it may become a self fulfilling prophecy.

 

Silver dropped to $13.30 in late 2015, rose to $21 in 2016, and immediately went into a second “nuclear winter” low in three years of US$13.93 in late November, 2018. Silver has now risen over $2.15 in a fraction over 2 months, before pulling back this past week to $15.65, from such a significant surge.

During the last eight month period investors left the precious metals sector reeling through lack of investment in mining shares, and more particularly for the health of the sector, the required funding to advance projects.

 

Bayhorse Silver has been affected by the lack of investment just like everyone else. During the recent Vancouver Resource Investment Conference, I saw many booths with a bare concrete floor, instead of carpet, that demonstrates how companies are conserving the scarce dollars they have.

 

While the precious metals finally look promising, in our opinion, the sector is not out of the woods yet, but now might be a good time to accumulate at the current, still low prices.