WCE granted new ground next door to its WA silver mine

Our silver Investment West Coast Silver (ASX: WCE) just picked up some ground next door to its historic high grade silver mine.

WCE has a WA silver project that produced 1.2M ounces of silver at an average grade of ~2,194g/t in the early 2000's.

The project had gone largely untouched since, production had mainly stopped because of what happened to silver prices all the way back then.

There is also a resource upgrade pending plus development studies in the works.

WCE picked up the asset in May last year and now has a maiden JORC resource of ~2.8M ounces of silver at ~617g/t making it the highest grade silver project on the ASX.

Today, WCE was granted a new licence directly west of, and bordering, the mining lease that hosts the old mine:

(source)

The new ground is called Elizabeth Hill West and it has targets sitting within 1km of the historic silver mine.

(source)

The old explorers here were hunting for nickel, copper and platinum group metals, and interestingly in several of those historic holes, silver was never even assayed for.

But the ground has thrown up some silver with a historical trenching result of 5m at 5.2g/t silver (plus 1.9% copper) plus one shallow drill hole hit 1m at 11g/t silver.

Soil sampling also shows coherent silver anomalies sitting on the same granite-ultramafic contact and fault structures that host the silver at Elizabeth Hill, so more of the same geological setting.

Here is a look at some of the historic results, including drilling, costeans (trenching) and sampling:

(source)

So this ground has never been properly tested for silver and now WCE will re-run the old data with a silver focused lens across it, which it has been able to refine from its prior work from next door.

The plan from here is to consolidate and re-interpret the historical data (including the holes never assayed for silver), run targeted geophysics and then rank targets for first-pass scout drilling.

What else is WCE up to?

WCE recently raised $6M at 9.5c in an oversubscribed capital raise - with the cash going toward moving the project out of the exploration stage and into the development stage.

We also participated and have added to our WCE position.

As a reminder, WCE had been drilling ahead of a Scoping Study on a near term production opportunity, aiming at an open pit on the granted mining licence over the historic mine.

So because there is a granted mining lease here already, this removes one of the larger barriers in terms of time.

And for an open pit, a resource at 617g/t silver is ridiculously high grade.

A higher confidence resource estimate matters to a project going through production studies because it's typically what the larger institutional investors look for when thinking about development financing for a project.

(the more certain a company is in its orebody, the less risky it is for a financier to back, so this type of drilling is required to help reduce the gaps)

See our educational article on resource categories here: What is a JORC resource? How does a company define a resource? 🎓

Recently WCE gave a tidy summary of its forward plan in an announcement as it moves from explorer to developer and hopefully beyond in a nearer term production opportunity:

(source)

You can see more on this in our recent Quick Take WCE hits more high grade silver - resource update due Q4

What’s next for WCE?

Here is WCE’s latest Gantt chart with everything we can expect to see over the coming months: 

(source - WCE’s latest investor presentation)

In terms of exploration the three things we are looking out for are:

1. Future drilling to upgrade the resource, including Inferred resources to Indicated
2. Drilling looking for extensions including the deeper high grade 3m at 524g/t silver hit.
3. Testing of new targets plus geophysics across the broader project area

And then all of that data rolling into what we expect to be an updated JORC resource being fed into a Scoping Study, expected to get underway in Q4.

Here are the milestones we are tracking right now:

• ✅ Drilling results (received today)
• 🔄 Updated mineral resource estimate (planned for Q4 - source)
• 🔲 Scoping study starts
• 🔲 Scoping study results