News Flash, March 2: Outcrop Silver & Gold Corp. on Wednesday announced that it will increase its previously announced public offering to $6 million.
The offering consists of units of the company at a price of $0.27 each. Units are made up of one common share of the company and one common share purchase warrant of the company. The holder of each warrant can buy one common share at an exercise price of $0.37 for two years after the close of the offering.
Outcrop said it has also given the agent in charge an option to increase the offering by an additional 15% to cover over-allotments and market stabilization.
Net proceeds from the offering will be used for working capital and general corporate purposes, the company said.
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Outcrop Silver & Gold Corp. (OCG:TSX.V; OCGSF:OTCQX; MRG1:DE) has surged 60% in value in the first quarter of 2022 since announcing it will complete assessment of this maiden resource with an additional 26,000 meters drilled by the end of the year. Drilling of more than 31,000 meters has substantially reduced risk for the project, according to Outcrop President, CEO, and Director Joe Hebert.
Drilling to date has resulted in gold and silver assays has high as 29 grams per tonne gold and 3,838 grams per tonne silver in the El Dorado area of its project.
The guidance indicates 45 to 55 million silver equivalent ounces at grade between 550 and 750 grams silver equivalent per tonne. The company’s exploration continues with plans to drill eight or more high-grade outcropping veins along an 18-kilometer trend.
The discovery is fortuitous as global inflation — soaring to 30-year highs in some countries — prompts investors to place assets into precious metals. However, Hebert said investing in precious metals companies can provide even more leverage than investing in physical metals themselves.
“I may be old-school, but I think gold and silver are inflation-proofed and have inherent value, as well as industrial value, particularly in the case of silver,” Hebert said. “I think silver is actually leveraged a little bit to gold when they start going up, as silver goes up a little higher, faster.”
Hebert notes that in addition to being an inflation-proof commodity, silver is also highly sought out as an industrial resource, with use in production of digital photography and other electronics equipment.
One of the attractive features of mining in Colombia, Hebert said, is that it truly is one of the last frontier exploration jurisdictions in the world. Outcrop is one of a fairly small population of explorers in the world with a presence there.
The company’s Santa Ana project comprises about 89,000 acres in northern Tolima Department, 190 kilometers from Colombia’s capitol of Bogota. The 100%-owned project consists of five or more regional-scale parallel vein systems across a trend 16.5 kilometers wide and 30 kilometers long. The Mariquita silver-gold belt of the Andes contains the highest-grade primary silver in Colombia, with historical silver grades reported to be among the highest in Latin America from dozens of mines dating back to 1585.
“It's easily the highest-grade silver gold project in Colombia. And it probably competes with any advanced or developing project in Latin America,” Hebert said.
The company announced on 2/23 that it had finished a fluid inclusion study from seven samples, revealing "temperatures and salinities consistent with a mesothermal, orogenic vein system, suggesting mineralization could extend to significant depths."
Outcrop noted that it has also started a LiDAR survey at the site to generate new vein targets over 19,000 hectares and sent sample composites for initial metallurgical test work for the maiden resource estimate by the end of the year.
“Outcrop expects to continue to add to its inventory of high-grade shoots by generating and testing numerous high-quality targets on our district scale property,” Hebert said. “Extending Dorado expands the potential resource area for a compliant maiden resource report before the end of 2022.”
The company is adding drill-indicated potential resource areas faster than peer companies, including Blackrock Silver, Kuya Silver, Summa Silver, and Baroyeca Gold & Silver, according to the company. Additionally, Outcrop’s new venture, at 550 to 750 grams silver per tonne, amounts to three to four times the average grade of other competitors in the region, Hebert said. By comparison, the 10 largest or most important underground silver mines in the world average about 350 grams per tonne, and leading silver producer Viszla Silver Corp. averages 480 grams per tonne.
Outcrop’s growing high-grade discovery in a low-risk jurisdiction moves the company to the next tier of value, said Hebert. He noted the projected growth in the next two years and the value added by the additional resources, which — coupled with a low market cap — offers a current window of investment opportunity.
Hebert said the increase of value in the project as the company has advanced it, as well as now going from the discovery stage to the resource compliant stage, is taking the company to the next level.
“It's pretty much put a clear path forward for investors,” Hebert said. “Outcrop has a growing high-grade discovery in a low-risk jurisdiction that is moving to the next tier of value by publishing a maiden robust compliant resource in 2022.”
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1) Hal Walter compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He and members of his household are paid by the following companies mentioned in this article: None. His company has a financial relationship with the following companies referred to in this article: None.
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