AbraSilver Resource (TSX: ABRA) says new drilling at the Diablillos project in Argentina supports potential resource growth beyond its definitive feasibility study (DFS). The stock rose in early trading.
The company reported new results from five holes at the Cerro Viejo target. Highlights included hole DDH 26-037, which cut 27 metres grading 4.6 grams of silver per tonne and 0.58 grams of gold from only a 23-metre depth.
Meanwhile, hole DDH 26-047 returned 32.0 metres grading 2.8 grams of silver per tonne and 0.29 grams of gold from a depth of just 9 metres downhole.
“What stands out from these results is the continuity of shallow gold mineralization, with mineralization beginning essentially at surface in several holes,” said Dave O’Connor, the project’s chief geologist. “Continued drilling will help us better define the scale and potential of this emerging target.”
Located about 160 km south of the city of Salta, Diablillos is one of Argentina's largest undeveloped precious-metals projects. AbraSilver has now drilled more than 170,000 metres at Diablillos.
The company’s shares rose 5.51% to $15.50 (US$11.19) apiece Wednesday morning in Toronto.
Drilling continues
Abrasilver says it has completed about 12,000 metres and 54 diamond drill holes in its Phase VI exploration program since it started in Jan. Two rigs remain active at Diablillos, with a third expected to be mobilized later this month.
John Miniotis, AbraSilver’s president and CEO, called the results “encouraging.” He added, “Our exploration efforts have returned to unlocking the longer-term growth potential, and Cerro Viejo is emerging as an exciting target within the broader district.”
Drilling continues along the known mineralization at Oculto West, Oculto East and the JAC–Oculto trend. In March the company announced the acquisition of the nearby Condoryacu property, where initial drilling returned 72 metres grading 117 grams of silver per tonne and 18.7 grams of gold.
Diablillos is projected to have an after-tax net present value (NPV) of about $4.15 billion with a 42% internal rate of return and a 1.7-year payback period.
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