Vizsla posts 48.7% increase to Panuco resource

Vizsla Silver has released an updated resource estimate for its Panuco silver-gold project in Sinaloa, Mexico that features a 48.7% increase to the indicated and inferred resources from the January 2023 resource estimate and higher grade.

The indicated resource is estimated at 9.5Mt grading 289gpt silver, 2.41gpt gold, 0.27% lead and 0.84% zinc for a 511gpt silver equivalent containing 88.2Moz of silver, 736,000oz of gold, 25,400t of lead and 79,900t of zinc for 155.8Moz of silver equivalent at a 150gpt cut-off.

In January 2023, they were 104.8Moz grading 437gpt. Inferred resources now total 12.2Mt grading 433gpt silver equivalent for 169.6Moz.

Vizsla used metal price assumptions of US$24/oz silver, $1,800/oz gold, $2,425/t lead and $2,976/t zinc.

The updated resource includes 178 new infill/expansion holes for 100,222m. The resource is based on 822 holes for 302,931m completed by Vizsla on 11 epithermal veins since November 2019.

It also includes the La Luisa area, an area of higher grade traced over 700m long by ~400m deep, which contains an indicated resource of 4Moz AgEq and 25.3Moz of inferred resources. The company said it had incurred exploration expenditures of $103 million on the project, which equates to an estimated discovery cost of 32c/oz.

"Resource focused drilling throughout 2023 was successful in converting almost half of the January 2023 inferred resource to the indicated category while exploration drilling added new resources at both Copala and Napoleon. The bulk of this year's resource growth came from the Napoleon Area, largely driven by the inclusion of La Luisa, which added 25Moz silver equivalent in inferred mineralisation," said Viszla Silver chief executive Michael Konnert.

PI Financial analyst Phil Kerr said the update "exceeded expectations" in a research note. "Considering its high-grade nature, extraordinary widths at Copala and continued discovery of new veins across the property, we view Panuco hosting significant upside and reduced operating risk versus other narrow vein projects," said Kerr, who has a buy rating and C$2.85 target price on the company.

PEA in 2024

Vizsla is continuing with a +65,000m drilling programme this year with four drill rigs, wit the aim of releasing a further resource update in the second half of 2024. The company also aims to complete a preliminary economic assessment this year.

Konnert said the company plans to "continue advancing the high-grade resource in the west towards development while simultaneously hunting for the next epicentre of mineralisation in the central and eastern portions of the district".

Shares in Vizsla Silver are trading at C$1.73, valuing the company at C$360 million.