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Monday, December 24, 2007

Metals prices further brighten mining outlook

Roughly 1,800 people attended the Northwest Mining Association's annual convention here this month and "there wasn't an unhappy face in the joint," says Laura Skaer, the group's executive director.

"It was very, very upbeat," Skaer says. "Prices are up and are expected to stay up next year."

Gold has been selling for about $790 a troy ounce recently, compared with $630 an ounce at this time last year and $525 in late 2005. Silver is selling for about $14 an ounce, up modestly from a year ago, but markedly higher than in late 2005. Other metals prices also remain strong.

Demand for metals continues to grow, due in part to the fast-developing economies of China and India, says Vicki Veltkamp, the mining association's current president and vice president for investor relations at Coeur d'Alene-based Hecla Mining Co. The supply side, meanwhile, "hasn't changed that much," Veltkamp says, adding that it takes years to bring new production on line.

"The mining industry has been rejuvenated by the increase in metals prices overall," she says. "There's increased activity. A lot of excitement."

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