Reyna Silver Corp.'s (RSLV:TSX.V; RSNVF:OTCMKTS) focus is clear: it aims to assemble a portfolio of high-grade silver assets that offer district-scale potential, and to that end it is moving forward with a number of projects that it believes offer that. "Four of our six properties each offer the excellent possibility of making a very significant discovery," Reyna Silver CEO Jorge Monroy told Streetwise Reports.
Reyna Silver's newest addition to its portfolio, announced in early October, is the Medicine Springs project, located in Elko County, Nevada. The company optioned the property from Northern Lights Resources and has the right to earn up to an 80% interest. The property is located just off the gold-rich Carlin Trend.
"Northern Lights inherited a fair amount of drilling," Monroy said. "Because Medicine Springs is near the Carlin Trend, Northern Lights was actually looking for a Carlin-type gold deposit. However, it intersected what looks like a carbonate replacement deposit (CRD) system. The information from that drilling is quite helpful to us, and Northern Lights also conducted some geophysics and geochemistry."
Dr. Peter Megaw, Reyna's chief technical advisor, is "one of the leading authorities on CRDs," Monroy explained. "The project is in what you would call elephant country, as far as CRDs go."
Monroy noted that Medicine Springs produced silver in the past at high grades and historical drill holes returned assays as high as 15 meters at 82 grams per tonne (g/t) silver including 7.6m at 138 g/t silver, and 44m at 69 g/t silver including 6m at 225 g/t silver.
"Medicine Springs ticks the most important boxes we look for in CRD exploration including location on a large regional structure that hosts significant CRDs, situated at the top or a thick section of potentially favorable carbonate host rocks and evidence of high silver grades," Dr. Megaw said. "Some of the dump and rock chip samples run well over our 400 g/t silver threshold, and it is quite likely that similar grades were diluted by the reverse circulation drilling used historically in the district. We will be drilling core to get a true picture of the clearly structurally controlled mineralization as we trace it towards its source."
"Medicine Springs is a Guigui-like CRD system with high-grade silver potential, and we are eager to begin applying the same exploration model that led to Arizona Mining's Taylor Manto and MAG Silver's Cinco de Mayo discoveries. The Northern Lights team has done an excellent job developing the project to its current near-drill ready stage, which lets us hit the ground running," Monroy said.
The company has drill permits in hand for Medicine Springs. "We are evaluating whether we execute on the drill campaign now, or do a little bit more work first," Monroy said.
Reyna has the option to acquire up to 75% of Medicine Springs without any up-front payment, and must complete total work expenditures of US$2.438 million by the end of 2023.
Reyna's flagship asset is Guigui, a carbonate replacement deposit (CRD) system located in Mexico's Chihuahua state. Reyna acquired the asset from MAG Silver.
Guigui is part of in the Santa Eulalia mining district, Mexico's largest known CRD system, and one of Mexico's major silver and base metal producers. Historical production has yielded around 500 million ounces of silver, 3 million tonnes of lead and 2.3 million tonnes of zinc from the district.
Guigui is located close to the San Antonio Mine and drilling conducted by MAG Silver in 2005 indicated that the "mineralization in the San Antonio Mine area continues to the Guigui property and indicates a much wider hydrothermal system." The company's geologists theorize that the sources of mineralization for the Santa Eulalia mining district could lie on Guigui's property, and plan a drill program to test it.
"We're in the final stages of getting our drill permits, and we're looking to drill 10,000 meters initially," Monroy said.
The company in July announced it had extended the property into the La Chinche claim to expand Guigui's exploration potential. "It was important for us to acquire La Chinche for a number of reasons, primarily because MAG Silver's geophysical survey showed a very strong anomaly that bleeds from the Guigui property to La Chinche property," Monroy said. "There's also a historical mine within the La Chinche property. And it was the connection between Guigui and the producing mine called Potosi. We wanted to make sure that we had this property before we started drilling."
Reyna took out an option on the La Chinche where it has to spend $900,000 over two years. And at the end of the two years, it can earn 80% by making a one-time payment of $1 million.
Another recent acquisition of Reyna Silver is La Reyna, also located in Chihuahua, in the Cusihuiriachic Silver Mining District, which produced more than 80 million ounces of silver from the 1600s until the 1940s. The property includes the historical La Reyna Mine.
"The property is, in keeping with the theme of the company, high-grade silver, with district scale potential," Monroy said.
Monroy also noted that the La Reyna acquisition is organized purely on an option basis. "We didn't have to pay any cash up front, no shares up front. That gives our shareholders extra optionality on the silver price without having to incur any dilution."
"We recently started an exploration campaign that will last for about two months," Monroy explained. "We are going to do detailed mapping, some 200 chip and grab samples, satellite imagery, and potentially some geophysics as well. The goal here is to have drill targets by the end of 2020."
Reyna Silver, in August, appointed Peter Jones as chairman. The company noted that Jones was "instrumental in the development and transformation" of HudBay Minerals Inc. when he served as that company's CEO. HudBay is "one of Canada's largest copper producers," Monroy said.
In August, Reyna closed a brokered private placement that raised approximately CA$7 million, and now has a treasury of CA$11.7 million. The company has 87.2 million shares issued and outstanding; 112 million fully diluted. MAG Silver holds 12.5% of its shares and institutional investors hold an additional 40%; managements holds 18%.
Bob Moriarty wrote in 321gold in June, "Reyna has one of the strongest technical teams in mining much less in Mexico with Dr. Peter Megaw and Doug Kirwin. Peter is the leading CRD guy in the world. . .Reyna has the potential for being the leading silver junior in Mexico. It will be a silver-bugs' delight."[NLINSERT]
1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: MAG Silver. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with Reyna Silver. Please click here for more information.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Reyna Silver, a company mentioned in this article.
Disclosures from Bob Moriarty, 321gold, June 5, 2020
Reyna Silver is an advertiser and I have participated in the latest private placement. Do your own due diligence.