(Source: Exploration Insights)
If you're into investing in the mining sector, you should know the above chart very well. This series covers the three projects with the most significant drill interceptions over the past week, as well as the prospects of the companies which own these projects. I will use data from the weekly bulletin of RSC Mining and Mineral Exploration, which can be found on its website. Note that the drill interceptions are converted into grades of gold equivalents using the following formula:
(Source: RSC Mining and Mineral Exploration)
RSC Mining and Mineral Exploration has chosen gold as the metal equivalent for all conversions, as it considers it the most widely used and best-understood benchmark to determine or appreciate the grade tenor of a drilling intercept.
(Source: RSC Mining and Mineral Exploration)
1) Silver Sand silver project in Bolivia
On August 27, New Pacific Metals (OTCQX:NUPMF) released assay results from 20 drill holes at its Silver Sand project and they continued to show wide intervals of silver mineralization. The best interception was 165.5m @ 204g/t Ag, 0.06% Pb and 0.01% Zn from 73.8m in hole DSS522506, which is equal to 396(AuEq.)m. The interception included a bonanza grade sub-zone of 45.0m @ 641g/t Ag.
Silver Sand is located in the department of Potosi, around 25km northeast of the giant Cerro Rico silver and base metals deposit:
Between 2017 and 2018, New Pacific drilled 55,010 meters in 195 HQ size diamond core drill holes and is currently in the middle of another 55,000-meter drill program which should be completed by March 2020. It will cost around $12 million, or some $220 per meter:
(Source: New Pacific)
New Pacific plans to release an initial NI 43-101 resource estimate for Silver Sand by the end of 2019.
It’s an early stage project, but it’s moving forward very fast and the company has some very serious backers. Silvercorp Metals (SVM) and Pan American Silver (PAAS) have 27.8% and 16.2% interests, respectively. New Pacific is led by Silvercorp CEO and chairman Rui Feng, who owns a 7.6% stake in the company.
2) Stardust polymetallic project in Canada
On August 26, Sun Metals (OTCPK:SMTTF) released assay results from drilling in the 421 zone at its Stardust project and the best interception was 86.4m @ 1.65% Cu, 1.56g/t Au, 28.8g/t Ag and 0.28% Zn from 537.6m in hole DDH19-SD-437. This is equal to 339(AuEq.)m:
In late 2018, discovery hole 421 returned 100m @ 2.51% Cu, 3.03g/t Au and 52.5g/t Ag and DDH19-SD-437 was a 15-20m step-out hole to the north.
Stardust is located in north-central British Columbia and is accessible by road:
Until 2018, a total of 427 holes for some 87,000 meters were drilled on the property. It currently has indicated resources of 985,000 tonnes grading 1.34% Cu, 0.62% Zn, 1.59g/t Au and 36.8g/t Ag.
(Source: Sun Metals)
3) Rupice poly-metallic project in Bosnia and Herzegovina
On August 26, Adriatic Metals announced results from nine drill holes from the current drill program at its Rupice project. The best interception was 38m @ 6.2% Zn, 3.8% Pb, 174g/t Ag, 1.93g/t Au, 0.4% Cu and 33% BaSO4 from 208m in hole BR-17-19, which is equal to 338 (AuEq.)m:
The new drill holes showed that high-grade mineralization continues north into the new concession area at Rupice and remains open.
Adriatic Metals owns a historic open cut zinc/lead/barite and silver mine at Veovaca and Rupice, which are 12km apart:
Veovaca was mined between 1984 and 1988 and produced a zinc, lead and barite concentrate.
In July 2019, Adriatic Metals released a maiden mineral resource estimate for Rupice as well as an updated one for Veovaca:
The maiden Rupice resource starts at surface and extends to 300 meters at depth, with mineralization remaining open in various directions. A total of 87 intersected mineralized zones remain open to the north, south and west.
New Pacific’s Silver Sand property still doesn’t have a resource estimate, but you can already tell it’s a world-class project. One of the first holes drilled at the site intercepted 187 meters of mineralized rock, with an average grade of 162 grams silver per tonne. And 190 of the 195 holes drilled in the original five square kilometer claim during the first 55,000-meter diamond drill campaign hit mineralization. The grades and size of this deposit look outstanding. I think that Silver Sand could become a tier one silver project but its success will depend on fostering good relations with nearby communities.
Hole 421 at Sun Metals’ Stardust project was spectacular with 100 meters of 5% copper equivalent, making it one of the best drill results in Canada in 2018. And now the first step-out hole to the north has delivered decent results. With a market cap of below C$50 million, I think that Sun Metals looks like a speculative buy.
As I mentioned in previous entries of this series, I think that Rupice could become a large low-cost polymetallic project. Mineralization is shallow, infrastructure is great and the project is open in most directions. Adriatic’s shares are currently not listed in the U.S. so if you want to gain some exposure, you’ll have to go to the ASX. The company was listed in 2018 and it has a cornerstone investment and strategic relationship with Australian copper producer Sandfire Resources (OTC:OTC:SFRRF).
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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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