Vizsla confirms starter pit potential

Vizsla Silver has confirmed high-grade mineral continuity where initial mining is likely to occur during the first two years of production at Copala central at its Panuco silver-gold project in Sinaloa, Mexico.

Near-surface infill drilling is intended to upgrade resources to the indicated category. Highlights from 22 holes reported included 6.25m grading 6270gpt silver equivalent. The programme's success has seen the company add another 5000m to it to extend resources beyond the current resource estimate and upgrade additional inferred resources.

"Not only has this programme been successful in demonstrating continuity of high grades but has also expanded the local high-grade footprint closer to the surface," said Vizsla Silver chief executive Michael Konnert.

Vizsla aims to have all the drilling completed in September to include in a resource update to be issued before the year's end. Panuco currently hosts indicated resources of 9.5Mt grading 289gpt silver, 2.41gpt gold, 0.27% lead and 0.84% zinc-containing 88.2Moz of silver, 736,000oz of gold, 25,400t of lead and 79,900t of zinc. It also hosts 12.2Mt of inferred resources.

"We continue to anticipate a series of de-risking deliverables to aid in Panuco's advancement toward a potential construction decision in late 2025," said Ventum Financial analyst Phil Ker in a research note, who has a C$3.55 per share price target on the company and a top pick rating.

In July, Vizsla reported a preliminary economic assessment on Panuco outlining an underground mine to produce an average of 15.2Mozpa of silver equivalent for an initial 11 years.

As an underground development, Panuco is unlikely to be impacted by the government's efforts to pass a bill to ban open pit mining. That may not be the case for the Cordero project in Chihuahua of follow junior developer Discovery Silver saw its shares fall 20% in value earlier this month when the legislation passed Mexico's lower house.

The value of shares in Vizsla Silver has increased 58.6% so far this year. They are trading at C$2.68, valuing the company at $650 million.

The value of shares in Discovery Silver has fallen 15.8% so far this year. They are trading at 64c, valuing the company at C$256 million.