The New Standard in Silver
SilverCrest Metals Inc.
NYSE American Stock Exchange: SILV
Toronto Stock Exchange: SIL
If you just watched our Hard Asset Digest welcome video, then you heard mining investment legend Rick Rule say, on the record...
We are near rock bottom in the gold market… and each and every time this market has recovered over the last 40 years…
the upside has been between 200% and 1,200%!
President & CEO
Sprott US Holdings, Inc.
That means select gold and silver stocks are poised to do very well in 2020 AND that they belong in your well-diversified portfolio as a hedge against rising geopolitical uncertainty and a falling US dollar.
Like Rick says…
“If past is prologue, investors will do well in gold… speculators will do well in physical silver…
but intelligent speculators could do extraordinarily well in the silver stocks!
That’s the sector where Rick took Silver Standard from $0.72 to $45 and Pan American Silver from $0.50 to $45.
This Special Report, brought to you by Hard Asset Digest, details a silver exploration and development company Rick has been following for a number of years: SilverCrest Metals Inc.
SilverCrest Metals Inc. is a Canadian-based precious metals exploration company focused on advancing its 100%-owned Las Chispas Silver-Gold Project.
Las Chispas is considered the 3rd highest-grade primary silver deposit in the world.
The property consists of 28 concessions totaling 1,400 hectares (3,460 acres) and is located approximately 180 km (112 mi) northeast of Hermosillo — Sonora, Mexico.
Currently, SilverCrest Metals has 17 drill rigs on the Las Chispas property with about half the rigs focused on converting “resources” to “reserves” and the other half looking for new silver ounces to add to existing resources.
Translation: There should be no shortage of exciting drill results throughout 2020.
Impressively, SilverCrest has been able to hit on approximately 70% of its drill holes to-date and boasts a finding-cost-per-ounce of just C$0.25.
SilverCrest’s 2019 Preliminary Economic Study of its Las Chispas property projects silver production to come in below $5/oz during the first four years of production — roughly a $10/oz margin at today’s silver prices.
By focusing on the highest-grade material first, initial silver production is projected to be 13.7 million ounces per year for the first 4 years.
And there’s tons of upside potential on the exploration side as well.
Currently, only 10 of the 36 known veins at Las Chispas have been put toward the company’s latest resource estimate… leaving 26 veins still to be drill-tested.
A Feasibility Study is currently underway and is planned for release in Summer 2020.
Remember, when it comes to astute resource stock speculation, Rick says to focus on “serially successful” people and on deposits that have the ability to become large-scale operations.
“The serially successful people win again and again and again!”
Led by N. Eric Fier, SilverCrest Metals is run by a serially successful team of industry professionals.
And, the company’s Las Chispas Silver-Gold Project – the 3rd highest-grade primary silver deposit in the world – has the potential to be a bona fide game changer.
SilverCrest Metals is headed by CEO, N. Eric Fier — a Certified Professional Geologist and Engineer with over 30 years of experience in the international mining industry including exploration, acquisition, development, and production of numerous mining projects in Guyana, Chile, Brazil, Central America, Mexico, and Peru.
N. Eric Fier
CEO & Director
30+ years experience, Geological & Mining Engineer
Eric has in-depth knowledge of project evaluation and management, reserve estimation and economic analysis, construction, as well as operations management. Mr. Fier previously worked as Chief Geologist with Pegasus Gold, Senior Engineer & Manager with Newmont Mining, and Project Manager with Eldorado Gold.
Prior to the formation of SilverCrest Metals, Eric was a co-founder and COO of SilverCrest Mines Inc., which was acquired by First Majestic Silver in 2015. He was largely responsible for the successful implementation of a systematic and responsible “phased approach” business model that built the Santa Elena project into a successful and profitable mine.
Pierre Beaudoin, COO — is a mineral processing professional with over 30 years of international operating and project development experience. Prior to joining SilverCrest Metals, Mr. Beaudoin held the position of Senior VP of Capital Projects with Detour Gold where he led the design and construction of the Detour Lake Mine.
Chief Operating Officer
30+ years experience, Operating & Project Development and Mineral Processing
Prior to that experience, Pierre spent 16 years with Barrick Gold where he held management positions at the processing plants of Barrick operations in Canada and Western Australia and led study teams in Tanzania, Alaska, and Chile.
Las Chispas Silver-Gold Project — Sonora, Mexico
In July of last year, SilverCrest Metals announced the filing of an independent Preliminary Economic Assessment (PEA) completed by Tetra Tech Canada, Inc. for its 100%-owned Las Chispas Project in Sonora, Mexico.
The PEA is based on the mineral resource estimate titled, “Technical Report and Mineral Resource Estimate” for the Las Chispas Property, Sonora, Mexico, and can be accessed here.
The PEA assumes a silver price of $16.68/oz, a gold price of $1,269/oz, and a Mexican Peso/US$ exchange rate of 20:1.
1,250 tonnes per day (“tpd”) production rate with an initial mine life of 8.5 years;
Average diluted grades for silver (or “Ag”) at 411.0 grams per tonne (“gpt”), gold (or “Au”) at 4.05 gpt and silver equivalent (or “AgEq”; based on 75 (Ag): 1 (Au), defined in table below) at 714 gpt;
Average annual production of 5,384,000 oz Ag and 55,700 oz Au, or 9.6 million oz AgEq;
Years 1 to 4: average annual production of 7,575,000 oz Ag and 81,600 oz Au (13.7 million oz AgEq).
Life-Of-Mine (“LOM”) All-in sustaining cash costs (“AISC”) of $7.52/oz AgEq;
Years 1 to 4: AISC of $4.89/oz AgEq.
Initial Capital Expenditure (“Capex”) of $100.5 million;
LOM Sustaining Capex of $50.3 million;
Payback period of 9 months;
After-tax IRR of 78%;
After-tax NPV of $406.9 million; and
Cumulative Undiscounted Net Free Cash Flow of $522.5 million.
SilverCrest followed up its PEA with the announcement of its best drill hole to-date (November 21, 2019):
Hole LC19-118 establishes a new record for the Las Chispas Property returning 8.6 metres grading 7,873 gpt AgEq. This result is particularly impressive given that it is the first intercept of this magnitude returned from the Las Chispas Area, and it is outside the current resource estimate.
This newly defined high-grade zone has been named Area 118 zone after the discovery hole LC19-118. The approximate high-grade footprint of Area 118 is 300 meters along strike by 125 meters in height and includes two adjacent and intersecting veins, Las Chispas and Giovanni.
The weighted average (true width, uncut and undiluted grades) of the defined initial high-grade footprint in this zone is 1.6 metres grading 16.54 gpt gold and 1,837.3 gpt silver, or 3,078 gpt silver equivalent.
Las Chispas Project: Timeline
SilverCrest Metals began underground development at Las Chispas in Q2 2019 with the construction of the Santa Rosa exploration decline.
As part of the underground development, the company began stockpiling high-grade material from the Babicanora Vein, including the Area 51 zone (see below).
In-vein development has given the SilverCrest team a better understanding of the high-grade vein reconciliation compared with the PEA resource block model, including:
Underground geotechnical and mining parameters
Bulk sampling for metallurgical work; specifically high-grade shear zone clays not considered in the PEA
Scheduling high-grade stockpiled material for conceptual production startup and de-risking
For 2020, SilverCrest has budgeted approximately US$16 million for a 125,000-meter exploration drill program.
In Q1, the program will focus primarily on expanding measured and indicated resources to be considered for inclusion in the initial reserve estimate with the forthcoming Feasibility Study (Summer 2020).
Next, underground development will continue with in-vein drifting and de-risk testing of mining methods well ahead of the conceptually planned mine start-up.
Results from reconciliation of tonnes and grade will be announced as work progresses.
For the latter part of the year, the SilverCrest exploration team will shift from mostly in-fill drilling for resource conversion to reserves to drill-testing new vein targets to-depth / along-strike of known high-grade veins and in underexplored areas.
That includes the 26 known veins not in the current resource calculations.
Remember, in an incipient precious metals bull market, Rick Rule is fond of saying...
Gold moves first…
Silver moves second... but moves the furthest!
We went looking for The New Standard in Silver — and SilverCrest Metals certainly checks all of the pertinent boxes.
With C$124 million in cash and only 115.5 million shares outstanding on a fully-diluted basis, SilverCrest Metals is well-positioned to advance its Las Chispas Project in 2020 and beyond to the benefit of SIL / SILV shareholders.
The company’s management team – led by N. Eric Fier and Pierre Beaudoin – has a proven record of delivering value to shareholders as demonstrated by the company’s 3-year price-chart below.
Overall, SilverCrest Metals is transitioning its Las Chispas Silver-Gold Project from successful discovery and the completion of a PEA to completing a Feasibility Study for a mine construction decision and potential major construction startup in mid-2020.
Further, the company has the very real potential of becoming a major takeover target in due time.
Rick Rule says…
Don't pay attention to the small mine narrative...
Small mines make small money but have big risks!
Based on the company’s 2019 PEA, initial production at Las Chispas is projected to chime in at 13.7 million ounces per year for each of the first 4 years.
Already, the project is considered the 3rd highest-grade primary silver deposit on the planet… not to mention the fact that just 10 of the 36 known veins have been put toward the company’s current resource estimate.
Translation: SilverCrest’s Las Chispas Project offers resource stock speculators size, scale, and grade.
Naturally, there are numerous risks and potential pitfalls inherent in the resource stock arena, and SilverCrest Metals is not immune to such risks; always conduct your own due diligence.
To learn more about SilverCrest Metals Inc., be sure to: