Vizsla Silver launches test mining, bulk sampling in Mexico
Vizsla Silver Corp. [VZLA-TSX, NYSE, 0G3 Frankfurt] has launched a fully funded and fully permitted test mining and bulk sample program at its flagship, 100%-owned Panuco silver-gold project in Sinaloa, Mexico.
The company said test mining will focus on underground ramp development, lateral access, and ore extraction from the 460-level zone on the Copala structure. Also, approximately 10,000 tonnes of high-grade material is expected to be mined as part of the development. This bulk sample material will be stockpiled on site and may be used for future metallurgical testing.
Planned surface infrastructure development includes construction of portal facilities, access roads and laydown areas, supporting efficient test mining operations.,
Vizsla silver shares edged higher on the news, rising 0.77% or $0.02cents to $2.62. The shares trade in a 52-week range of $3.31 and $1.43.
The newly-consolidated Panuco gold-silver project is an emerging high-grade discovery located in southern Sinaloa, near the city of Mazatlan.
A preliminary economic assessment for Panuco envisages a 3,300 tonnes per day production rate for the first three years, expanding to 4,000 tonnes per day in year four, producing silver-gold dore with an initial mine life of 10.6 years.
The PEA forsees life of mine average payable production of 15.2 million ounces of AgEq annually (9.2 million ounces of silver and 78,000 ounces of gold.
On January 8, 2024, Vizsla Silver announced an updated mineral resource estimate for Panuco. It includes an estimated in-situ indicated resource of 155.8 million ounces of silver equivalent (AgEq) and an in-situ inferred resource of 169.6 million ounces of AgEq.
In addition to test mining and bulk sampling program, Vizsla continues it ongoing exploration efforts in the eastern portion of the district with two drill rigs. The fully-funded 10,000-metre discovery-based drill campaign is focused on locating new centres of high-grade mineralization outboard of the current preliminary economic assessment mine plan.
Wednesday’s announcement comes after the company recently closed a $65 million bought deal financing with proceeds earmarked for the Panuco project.
Vizsla Silver was in the news recently when the company said it had received final TSX Venture Exchange approval for a previously announced plan to reorganize its business, including the spin-off of its wholly-owned subsidiary, Vizsla Royalties Corp. [VROY-TSXV].
Vizsla Royalties currently holds, indirectly a net smelter royalty on any potential future mineral production from Vizsla’s 100% owned Panuco project. The shares recently began trading on the TSX Venture Exchange.
The royalty consists of a 2.0% net smelter return royalty on certain unencumbered Panuco concessions, and an 0.5% net smelter return royalty on certain unencumbered concessions on the project, which have a pre-existing 3.0% net smelter royalty.
Under the spin-out plan, Vizsla Silver pledged to transfer to Vizsla Royalties the right to purchase one half of the underlying royalty, and grant Vizsla Royalties the right to acquire a royalty on any future projects acquired by Vizsla Silver for two years after the spinout is completed.