Prime eyes upside potential at Mexican gold-silver project
Prime Mining Corp. [PRYM] said drilling suggests that the three known main deposit areas at its flagship Los Reyes gold-silver project in Sinaloa, Mexico, are larger than previously reported. “Potential exists for new discoveries where mineralized trends have been identified outside the currently defined resource areas,’’ the company said in a new technical report.
On Thursday, Prime shares edged up 1.34% or $0.02 to $1.51. The shares trade in a 52-week range of $2.50 and $1.13.
Los Reyes is a high-grade, low-sulphidation epithermal gold-silver project. Since acquiring the project in 2019, Prime has spent more than $59 million on direct exploration activities and has completed over 210,000 metres of drilling. On October 15, 2024, Prime announced an updated multi-million-ounce high-grade open pit constrained resource based on exploration drilling up to July 17, 2024.
The company said open-pit milled indicated and inferred resources have grown to 1.27 million indicated ounces of gold equivalent (AuEq) (24.7 million tonnes at 1.60 g/t AuEq) and 335,000 inferred ounces (7.2 million tonnes at 1.45 g/t AuEq, respectively.
New underground milled indicated and inferred resources stand at 664,000 indicated ounces AuEq (4.1 million tonnes of 5.00 g/t AuEq) and 406,000 inferred ounces AuEq (4.1 million tonnes at 3.12 g/t AuEq), respectively.
Open pit heap indicated and inferred resources have grown to 261,000 indicated ounces AuEq (20.3 million tonnes at 0.40 g/t AuEq) and 76,000 inferred ounces AuEq (5.9 million tonnes at 0.40 g/t AuEq) respectively.
Given the results from Prime’s success-based drilling program, the company has expanded its fiscal 2024 program to 50,000 metres from 40,000 metres.
The company said considerable upside potential: mineralization at Los Reyes remains open along strike and at depth, with the ongoing drill program targeting high-grade mineralization along both the northwest and southeast extensions of the Z-T Trend, the southeast extension of the Guadalupe and Central Trends, as well as emerging generative areas.
Five drill rigs are currently active on site at Los Reyes.
The company said historic operating results indicate that an estimated 1.0 million ounces of gold and 60 million ounces of silver were recovered from five separate operations at Los Reyes between 1770 and 1990.
Los Reyes is situated on 37 contiguous claims covering 6,300 hectares, located about 43 kilometres south east of the mining centre of Cosala, Sinaloa. Mining activity in the region dates back to the 1700s.
Prime completed the acquisition of the project from Vista Gold Corp. [VGZ-TSX, NYSE], in a deal that included the buy-back of two separate 2% net smelter royalties and a 49% back-in right on underground mining. Los Reyes was on-track to become a heap leach mine in 1998 when gold prices dropped and the project was mothballed.
Prior to Prime’s acquisition, recent operators at Los Reyes had spent approximately US$20 million on exploration, engineering and prefeasibility studies.