In a June 27 research note, ROTH Capital Partners analyst Jake Sekelsky reported that recent exploration at SilverCrest Metals Inc.'s (SIL:TSX.V) Las Chispas in Mexico "confirms previous expectations and sets the stage for further derisking" of the project.
Specifically, the Santa Rosa decline hit the high-grade Area 51 zone of the Babicanora vein and the newly discovered Babi Vista vein. The Babicanora vein was intersected within 10 meters of the existing resource model, confirming the estimated 3.6 meter (3.6m) true width and demonstrating the potential for Las Chispas resource expansion.
SilverCrest will follow up these events in H2/19 with bulk sampling for metallurgical testing, obtaining geotechnical studies, stockpiling of high-grade material and developing improved access to the Babicanora vein for additional infill and exploration drilling.
Also at Chispas, infill drilling over 18,488m in the Area 51 zone showed an average true width of 2.2m grading 7.1 grams per ton (7.1 g/t) gold and 752.6 g/t silver, or 1,290 g/t silver equivalent. "These results confirm both grades and thickness outlined in the existing resource estimate announced in Q1/19," Sekelsky wrote.
He noted, too, that the Babi Vista vein, discovered in Q2/19, could add high-grade ounces to the existing resource base at Las Chispas in the short term.
Sekelsky highlighted that SilverCrest is "swiftly advancing Las Chispas towards a feasibility study," which is anticipated in H2/20. He added that because further upside at the project likely exists, investors should view the preliminary economic assessment as merely a basis upon which the feasibility study can build.
ROTH has a Buy rating and a US$5.50 per share target price on SilverCrest, whose current share price is about US$4.07.[NLINSERT]
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Disclosures from ROTH Capital Partners, SilverCrest Metals, Company Note, June 27, 2019
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