Fortuna Silver (FVI.v) in the box seat

don't worry, this is not
CEO Ganoza on a bad hair day

A short but very sweet little news release from my fave Ag play Fortuna Silver (FVI.v) this morning. Here it is and below some comments:

VANCOUVER, Jan. 6 /CNW/ - Fortuna Silver Mines Inc. (TSX.V: FVI / Lima Exchange: FVI) is pleased to announce that the Company has signed a commitment letter to enter into a US $20 million senior secured revolving credit facility with The Bank of Nova Scotia. The facility will have a 2.5 year maturity. The proceeds of the facility may be used for general corporate purposes, including the development of the San Jose Project in Mexico.

The facility is intended to complement Fortuna's strong cash position and provide additional financing flexibility during the construction stage at San Jose. On December 14, 2009 the Company announced it had obtained all the required construction and environmental permits for the operation of a 1500 tonne per day underground mine. The San Jose pre-feasibility study is scheduled to be completed in the first quarter of 2010, with construction activities to commence shortly thereafter.

What this basically means is that FVI has turned around, looked the vultures of Bay St. and Howe St. in the eye, flipped them a serious bird and said, "We don't need your stinkin' lowball placement terms, go screw yourselves, we got all the cash we need to build our future." Of course FVI might eventually decide to do a placement, but if they do it'll be on the terms set by the company, not the gouging bankers and bullshit merchants that sit on stocks and depress their prices until the company caves in and does the deal. Put simply, the $20m credit facility, plus the healthy company treasury, plus the impressive free cash flow thrown off by Caylloma is enough to build San José, a mine with all its permits in place.

I'm long this stock. You might have realized this already. DYODD, dudettes and dudes, but if you can't be bothered, The IKN Weekly will be running an updated NOBS report on Fortuna Silver with a revised target price in this Sunday's edition. Be there or be square.