Silver Mines (ASX: SVL) is expanding the diamond drilling campaign at its Bowdens NSW project to up to 10,000m as a fast-rising silver price will mean increased investor focus on potential new exploration projects.
The primary targets of the drilling campaign are the high-grade silver lying below the current proposed pit and “multiple” new targets to extend the existing mineral resource.
Drilling is expected to continue until “at least” the end of 2020.
Silver was trading at US$25.52/oz on Tuesday morning (Sydney time), a 52-week rise of 56.09% and a 30-day increase of 43.41%.
The metal’s price has been propelled by a combination of safe haven demand for both precious metals as the global economy teeters, with the COVID-19 pandemic leading to mine closures in key silver producers Mexico and Peru, along with rising demand for silver as solar energy booms
Silver Mines claims Bowdens is the largest undeveloped silver deposit in Australia, and on which there are already substantial resources confirmed and much technical work completed.
In a presentation last year, the company also said Bowdens was “one of the largest undeveloped silver deposits in the world” with a resource of 275 million ounces of silver equivalent.
The project’s feasibility study demonstrated a mine life of 16.5 years.
$12m placement financing drilling campaign
The project area is located 26km east of Mudgee and covers 2,007 square kilometres, including about 80km of strike.
Work is to begin with drilling on extensions and infill at the Northwest high-grade silver zone where previous intersections included 14m at 319g/t silver (including 4m at 1,007g/t), 33m at 215g/t and 7.1m at 494g/t.
Since the most recent exploration update last April, Silver Mines says it has continued with targeting and drilling in the wider Bowdens environment.
In May, the company raised $12 million through a placement, the money primarily to be used for pre-development work at Bowdens.
At that time, also, Silver Mines submitted its development application and the environmental impact statement.
In addition, an external consultant’s review has highlighted the potential for multiple higher-grade silver zones within and close to the Bowdens project area.
Silver Mines says that, while the most recent drilling is being analysed, it has added significant understanding to Bowdens being located at the edge of a large caldera.