Americas Gold and Silver Corp. [USA-TSX; USAS-NYSE American] on Friday December 18 reported continued strong drill results from a Phase 1 program that is part of a recapitalization plan at its 60%-owned Galena Complex in the Silver Valley of northwest Idaho. The company is working to recapitalize the mine under a joint venture agreement with Canadian financier Eric Sprott.
The joint venture is allowing Americas to increase development, modernize infrastructure, purchase new mining equipment, and target exploration below current operating areas with the goal of positioning the Galena Complex to significantly increase resources, production and reduce operating costs over the next two years.
Sprott, through a private company, is committing US$20 million to fund these improvements and will earn a 40% stake in the project. Galena has previously produced up to 1.0 million ounces of silver annually, but at a high cost. Proven and probable silver reserves stand at 12.4 million ounces. The site contains a further 27.4 million ounces of measured and indication resources as well as 39 million ounces of inferred material.
â€œWe continue to see spectacular drill results from the Phase 1 drilling which already added over 50 million ounces of silver at the Galena Complex, with the goal for a further 50 million ounces to be added by June, 30, 2021,â€ said Americas Gold and Silver President and CEO Darren Blasutti.
â€œDrilling from the 4300 Level has the potential to add solid, incremental production in the near term while deeper drilling from the 5500 Level should position the operation to return to its peak 5.0 million ounce-per-year production longer term,â€ Blasutti said.
Highlights from 5500 Level drilling below existing infrastructure included Hole 55-133, which intersected both the 185 and 175 Veins with significant grade and widths, approximately 135 metres below the 5500 Level. The 185 Vein returned 694 g/t silver, 11.0% lead and 0.3% copper (or 1,119 g/t silver equivalent) over 2.3 metres. The 175 Vein returned 324 g/t silver, 3.4% lead and 0.1% copper (or 461 g/t silver equivalent) over 1.8 metres.
Meanwhile, the company said continued drilling targeting the upper zones of the 360 Complex from the 4300 Level has the potential to add significant incremental production in the near term.