The ratings on Coeur D'Alene Mines Corp. reflect its high business risk as a capital-intensive commodity-based company with a modest scope of operations, relatively high cost position, limited reserve base (averaging about three years), and very weak financial performance. Ratings also incorporate the company's aggressive expansion plans and uncertainties regarding its ability to successfully develop lower-cost mining operations. Meaningful challenges include volatile prices, governmental regulation, environmental issues, permitting, and adverse geological conditions. About two-thirds of Coeur's production is currently generated at its high-cost Rochester, Nev., and Galena, Idaho, mines. Coeur has undertaken several initiatives to improve its cost profile and bolster its reserve base. New lower-cost production from its Cerro Bayo mine in Chile and its Martha mine in Argentina,
