Explorer Closes Deals on Massive Silver Project Expansion in Golden Triangle

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In two news releases, Dolly Varden Silver Corp. (DV:TSX.V; DVS:NYSEA; DVQ:FSE) announced it has completed its purchases of the Kinskuch and Porter projects in British Columbia's Golden Triangle.

The expansions increase the company's Kitsault Valley Project to about 77,000 hectares (ha), "covering some of the most underexplored and prospective rocks for silver, gold, and copper mineralization in the Golden Triangle," the company said.

The Kinskuch Property was acquired from mining heavyweight Hecla Mining Co. (HL:NYSE) for consideration of CA$5 million, which was satisfied through the issuance of 1,351,963 shares, Dolly Varden said. Hecla also retains a 2% net smelter return royalty on the property.

Hecla Mining also owns 12% of Dolly Varden Silver shares after Hecla Canada invested CA$10 million in DV in 2023, significantly raising its stake.

Hecla's market cap is US$3.23 billion and operates in the Yukon, Alaska, Idaho and B.C.

"Our land package is surrounded by Hecla property," Chief Executive Officer, President, and Director Shawn Khunkhun has written. "Two of our technical advisors work for Hecla and are familiar with the styles of deposits we have."

DV also announced it had closer another sale, its purchase of the 3,192-ha Porter Property from StrikePoint Gold Inc. (SKP:TSX.V; STKXF:OTCQB) for CA$1.1 million or 295,6999 common shares of the company.

Also recently, the explorer entered into an agreement to acquire interests in four other properties totaling 20,000 ha in the same district as its Kitsault Valley silver-gold project. Unlike the Kiskuch and Porter property deals, this deal has yet to close.

The properties are American Creek (consisting of Mountain Boy, Silver Crown and the Dorothy option), Theia, BA, and Red Cliff. Three are road accessible and close to power and Ascot Resources Ltd.'s (AOT:TSX.V) recently completed Premier gold-silver mill near the port of Stewart.

"Shawn's vision for Dolly Varden is clear: becoming the premier advanced explorer in the Golden Triangle," Jeff Valks wrote for The Gold Advisor. "With strategic acquisitions stacking up and historic grades to boast, Dolly Varden is carving out its claim in one of the world's richest silver and copper districts."

Largest Drilling Program Ever

The company is completing its drill program at Kitsault Valley (at least 35,000 meters), which is fully funded, to grow its resource base and continue demonstrating its scale.

Kitsault Valley is prospective for additional precious metal deposits, the company said, because it is in the same structural and stratigraphic belts of numerous other, on-trend, high-grade deposits, including Skeena Resources Ltd.'s (SKE:TSX.V) Eskay Creek and Newmont Corp. (NEM:NYSE) Brucejack.

"Both the Kitsault Valley and the Illiance trends are interpreted to be part of a district scale, sub-basin of the Eskay Rift period," Dolly Varden said. "The Illiance trend has seen little modern exploration work, limited to localized diamond drilling by Hecla on the 3- kilometer-long, north-south trending Illy epithermal system."

Making a Serious Play in the Golden Triangle

The "jewel" of the deals, according to Valks, is the American Creek Property, a 2,602-hectare site centered on the historic Mountain Boy high-grade silver mine.

"According to BC Government Minfile Reports, silver production at Mountain Boy in the 1910s through the 1940s and 2000s showcased silver grades ranging from 8,000 to 17,000 g/t (grams per tonne)," he wrote. "Historic drilling results include 5.10 meters of 5,258 g/t silver and 6.1 meters of 2,260 g/t silver — figures that hint at substantial mineralization that remains open both to depth and along strike."

Valks said he and Jeff Clark both hold long positions. "The company has been making a plethora of strategic acquisitions in the last few months, marking a serious play at becoming the dominant silver player in the game," Valks wrote.

Raymond James Analyst Craig Stanley has an Outperform rating with a CA$3.52 per share target price on the stock.

Raymond James Analyst Craig Stanley noted on May 5, after the Kinsuch purchase that it would triple DV's strike length of the Red Line, which is the contact between the Triassic Stuhini and Jurassic Hazelton formations, "a key marker for precious metals and copper mineralization" in the historical mining district.

Stanley has an Outperform rating with a CA$3.52 per share target price on the stock.

"Dolly Varden has plenty of cash," he wrote. "Next year, the company will update the Kitsault Valley mineral resource estimate, incorporating into it drill results from the past four programs.

According to Dolly Varden, the Porter Project has an upside exploration potential between two shear hosted silver-rich vein systems: the historic Silverado mine and past-producing Prosperity-Porter Idaho mines which are separated by a 2,350-meter unexplored trend.

Veins at both sites run at a similar orientation and it is hypothesized that the system may be continuous under the summit of Mount Rainey," the company said. "The Prosperity-Porter Idaho vein system has seen past production, having been mined between 1929 and 1931, producing 27,123 tonnes of direct shipping ore with recovered grades of 2,542 g/t silver and 1 g/t gold (yielding about 2.2 million ounces of silver). The ore was shipped to the port at Stewart, British Columbia, via aerial tramway.

The Catalyst: Industrial Uses Are Silver's Secret Weapon

According to a report by Christopher Lewis for FX Empire on May 26, the silver market initially tried to rally during that trade session, reaching towards the US$34 level before collapsing.

"This is a market that I think is still stuck in this range," Lewis noted. "The US$32 level on the bottom has been massive support and the US$34 level above has been a massive ceiling. The 50-day EMA, of course, is close to the US$33 level, and that’s a technical indicator that a lot of people will pay attention to as well."

He said the US$33 level is "an area that could offer support, but even if we break down below there, then I’ve become more interested in buying the pullback."

Ernest Hoffman, writing for Kitco on May 27, noted that Francisco Blanch, head of global commodity and derivatives research at Bank of America Securities, said his firm expected silver to reach US$40 an ounce.

“We think silver is one of the better investments because remember, silver is half precious, half industrial," Blanch said. "The precious aspect of silver has been driving it higher, the industrial side has been taking a back seat, but this will eventually change."

Analysts still expect enormous investment in solar panels, which contain silver, and in the electrification of everything since it's nature's best electricity conductor.

"It's going to play a very important role, and we think going forward, once we go back into a more stable industrial activity environment, silver will shine again," Blanch said.

Peter Krauth of The Silver Stock Investor wrote on May 14 that silver looks poised for a two and a half-year breakout, a boon to silver mining equities. However, it may not happen until after the current typical seasonal weakness.

"The breakout could be spectacular," he added. "That's why you'll want to own the best of the best in this sector as we wait for that move."

Ownership and Share Structure

According to the company's latest corporate presentation in January 2025, 52% of its stock is held by institutional investors, including Fidelity Management & Research Company LLC, Sprott Asset Management LP, U.S. Global Investors Inc., and Delbrook. 

About 37% is with strategic investors, including 15% with Fury Gold Mines, 12% with Hecla, and Eric Sprott owns 10% himself. 

The rest, 11%, is with retail and high-net-worth investors.

The company has 79.52 million outstanding shares. Its market cap is CA$303.72 million, and its 52-week trading range is CA$3.21–5.84 per share.