Canasil Resources (TSX-V: CLZ) CEO Bahman Yamini on the Commencement of Drill Program Testing Four Highly Prospective Silver-Gold Targets at the Nora Project in Durango, Mexico
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president and CEO of Canasil Resources (TSX-V: CLZ)(OTC: CNSUF), Mr. Bahman Yamini. Bahman, how are you today, sir?
Bahman Yamini: Great. Thank you very much, Gerardo, nice to be online with you, a pleasure.
Gerardo Del Real: It's good to chat. You and I go back, I think, maybe 5 or 6 years. We all know that the past 3 or 4 years have been an exercise in patience, an exercise that I think is now starting to be rewarded.
To that end, Canasil had some news today that I think is going to be pretty important moving forward. You're preparing to drill the silver-gold targets at the Nora project in Durango State, Mexico. It's a project that I'm excited about. Can you speak a bit to the targets and the preparation that you're doing for the drilling that's upcoming?
Bahman Yamini: Certainly, Gerardo. We are also very excited about the Nora project. We think it presents a very exciting discovery potential there. It hasn't been drilled before. It is in northern Durango, about 200 kilometers north of the city of Durango, about 2 hours from our office and operating base in Durango.
Of course, as you know, like everywhere else we've been in lockdown in Mexico and now emerging from that. Both our team and the drillers have gotten all the protocols filed with the government and have been approved to operate. We're taking all the measures to make sure we operate safely in the local area, to safeguard the local communities and also our personnel and the contractor's personnel.
Now specifically in terms of the project, this is potentially a very large silver-gold system. It's located around 50 kilometers west of SSR Mining's Pitarrilla deposit, which is a 500-million ounce silver deposit. It's in the heart of the Mexican silver belt which hosts many important silver mines and deposits. In the region around Nora, they include Fresnillo's San Julian mine, Endeavour Silver's Guanacevi mine, and Great Panther's Topia mine. This is an area where a lot of silver is being mined and discovered. So we're very excited about it and certainly we can talk about the specific targets as well.
Gerardo Del Real: Let's talk about those specific targets because you're targeting high-grade gold and silver along the Candy vein.
Bahman Yamini: Exactly. There are 2 veins that we identify at Nora and we also have an extended area of disseminated silver in soils around the veins, which is the signature that suggests to us that we're sitting on top of a potentially very large silver mineralized system. The main vein, the Candy vein, outcrops for about 900 meters, and we trace the alteration for about 3 kilometers. It's a very strong vein.
We also have the Nora vein that sits about 600 meters to the northeast of the Candy vein. But the principal initial targets are on the Candy vein. We have sampled the Candy vein, both with rock chip samples and also some samples from surface dumps, which were left over from artisanal mining where the vein had been mined down to about 50 meters depth, close to the surface.
These samples grade up to 600 grams silver and in cases up to 12 grams gold. There's also interesting high copper, lead and zinc values that come in with that, which presents potential for by-product credits and increases the value of the rock and the value of the potential ore.
Bahman Yamini: On the Candy vein, we have set up 4 stations spaced over a strike length of 500 metres, 2 of them are below the highest grade silver values that we get, they're up to 600 grams silver, and below the previous underground workings that we've identified. This is a zone which we expect will return good mineralization going down, drilling below these surface samples and the workings. Then a little bit further north, we have 2 stations which are placed on the high-grade gold surface values, which range from 6 grams gold to 12 grams gold per tonne in the surface samples.
Both of these zones along the Candy vein present potential for discovery drill holes. The vein has never been drilled before. The project has never been drilled before. We're very excited about the potential and seeing what the drill holes return. We are planning a minimum 1,000 to 1,500-meter drill program with an average depth of drill holes of 200 to 250 meters. That should give us around 6 to 8 drill holes.
Gerardo Del Real: Excellent. Now the one thing that you did amongst others, but the one thing that stands out to me because so many companies were not able to do it during this brutal, brutal bear market that we're finally out of, was you were able to maintain the share structure in good shape.
Can you speak to the current market cap and the share structure? That's going to be important moving forward because of the leverage a good share structure combined with positive results provides.
Bahman Yamini: Certainly. We have 109 million shares issued, 120 fully diluted, including warrants, options, et cetera. We feel this is a very strong share structure. We have a very strong base of support from large shareholders who are high-net-worth individuals and family funds, based here in Canada and the US and in Europe. We've managed to maintain the share structure by being very careful during the downturns and not issuing a lot of shares at low prices.
Just for reference, the average price of a share that was issued by Canasil is $0.21 per share. The same number, $0.21 per share, has been spent on the projects. We have 4 major projects with $3 to $6 million expenditures on them.
That's a very strong base and any one of those projects could be a separate company in itself and would have around 25 million shares out for a significant project, which would be regarded as very low dilution. We are very comfortable with that structure and the base going forward. We think it allows for very significant value added as we progress.
Gerardo Del Real: You have a tiny market cap of just over $9 million Canadian. When will drilling actually commence, Bahman?
Bahman Yamini: Well, the crews are on the ground. They're upgrading the road, they're building the drill pads. The drill is expected to move in next week on July 8th, next Wednesday. And we expect the drilling to start immediately after that. I think we would expect to be drilling by the end of next week.
Gerardo Del Real: Excellent. And as far as the labs go, I'm assuming that you've been in touch, correct?
Bahman Yamini: Yes, absolutely. We have a lot of experience. We use ALS Chemex, which is a premier lab based here in Vancouver. The samples are usually processed in our processing warehouse in Durango. Then they're sent down to the ALS prep lab in Zacatecas where the samples are prepared and are sent here to ALS in North Vancouver. We get the assay results from ALS. Usually it's a 2 to 4-week turn around between having all the samples prepared and sent to the lab and then getting the assays over here.
Gerardo Del Real: Excellent, Bahman. This drill program is 4 years in the making. I know that you have a follow-up program at another property, but let's go one step at a time. I'm excited to get the results back from this and congrats again on surviving the very tough bear market that we had and fingers crossed.
Bahman Yamini: Thanks so much, Gerardo. Appreciate your interest. We're also very excited and looking forward to the program.
Gerardo Del Real: Thanks again, Bahman.
Bahman Yamini: My pleasure. Thank you.