Zacatecas Silver Corp. (TSXV: ZAC) three weeks after going public, has announced it has ramped up exploration plans to prepare a resource estimate at its Panuco silver deposit in Zacatecas State, Mexico.
The Zacatecas Silver property is located within the Fresnillo Silver Belt, which has produced over 6.2 billion ounces of silver. The company holds 7826 hectares (19,338 acres) of ground that it said is highly prospective for low and intermediate sulphidation silver-base metal mineralization and potentially low sulphidation gold-dominant mineralization.
Work is now proceeding, targeting resource confirmation of the significant historical inferred silver resource estimate in one of the world’s most prolific silver districts, but there are areas of Zacatecas that have never seen large-scale, modern exploration.
This is the first silver play for Zacatecas Silver CEO Bryan Slusarchuk, who is also CEO of Fosterville South Exploration and founder of K92 Mining. The Fosterville gold mine in Australia is one of the world’s lowest-cost, highest-grade gold mines, and Slusarchuk grew K92 mining from a micro-cap to a company with a $1.4 billion market capitalization.
Slusarchuk said he sees enormous potential with the Zacatecas silver project – the Panuco deposit has a historic inferred mineral resource of 19,472,901 ounces and the company plans to take it to N 43 compliant resource within 90 days.
Zacatecas Silver came out of the gate with an investment by Eric Sprott, arguably the world’s most famous silver investors, who owns 2 million shares, and it has $9 million cash.
“We’ve been very focused on gold as a group but we’ve been assessing silver projects all over. We just hadn’t found the right project to run with,” Slusarchuk told MINING.COM. “We finally found a project that had the unanimous support of our technical team.”
“It’s a great historic silver resource to start with and we think we are going to confirm and expand that resource even prior to drilling – it’s wide open for expansion along strike and at depth,” he said.
Outside of that, Slusarchuk said there are a host of exploration targets along the property, and that the team has traced the famed Veta Grande vein system for three kilometers on the property that have never been drilled.
Gold has been the precious metal getting all the attention as investors piled into the safe haven asset on the economic fallout of the pandemic. Gold price broke all-time records last August, reaching $2,050/oz. But silver also had an outstanding year, with its gain almost double gold’s.
California last year began requiring all new construction to include solar panels – for which silver is a major component.
Slusarchuk is bullish on silver and thinks “we are on the cusp of a really positive environment for silver.”
“Our timing worked out to be fortuitous, it does seem that while silver has been ignored for awhile, its now starting to get some traction out there.”
A big spotlight shone on silver with the infamous silver squeeze driving the price to an eight-year high in February. At the time, Slusarchuk voiced his opinion on Fox News.
“The silver squeeze phenomenon, and the traction and attention it got out there in the big scheme of things isn’t overly important, but it did introduce some new people to the silver scene,” Slusarchuk said. “Some of them were short term traders, and they came, and are now gone from the space, but there will definitely be some of those investors that stuck around and learned a bit more about the sector and found the argument compelling.”
What the silver squeeze did, Slusarchuk said, is alerted some people outside of the industry to the fact there is a big difference between physical silver, and these various paper silver derivates.
“Physical silver is very difficult to get, where these paper derivative contracts are getting kicked down the road, where most of the participants in that market having no desire nor any ability to ever settle the contracts for physical delivery. It drew attention to that, that there was some manipulation going on with all these paper derivative type products.”
“The unique thing about silver here is that it’s a double threat. Investors are in gold because of the investment thesis – gold is money – gold is a currency, a store of value, and its all very true but silver has that same thesis. Silver has been a currency for thousands of years,” he said.
“There’s an investment demand story for silver. But at the same time, silver also has the story unfolding that it’s a critical and crucial component of electrification and the greening of the economy, solar panel development. It’s that two-pronged story that makes it unique,” Slusarchuk said.
“What attracted us to silver is that it has both situations that can be very positive for demand. It’s increasing industrial demand due to electrification and green energy will drive the price of silver.”