Introduction
AbraSilver Resource (TSX: ABRA) has announced a significant milestone at its Diablillos project in northwest Argentina, uncovering its best-ever gold intercept. The news has driven a notable increase in the company’s stock price, reflecting investor confidence in the project’s potential.
Main Body
The drilling results from step-out hole DDH 25-024 at the Oculto deposit revealed 31 meters grading 10 grams per tonne of gold and 16 grams per tonne of silver, starting at a depth of 88 meters. Notably, this included a high-grade section of 6 meters at 41.9 grams of gold and 22 grams of silver, located just outside the eastern edge of the conceptual Oculto open pit in Salta province’s Puna region.
CEO John Miniotis highlighted the potential for expanding high-grade mineralization beyond the existing deposit, stating, “The spectacular intercepts from hole DDH 25-024 clearly demonstrate the strong potential to expand high-grade mineralization well beyond the existing Oculto deposit.” With three drill rigs now active across the Diablillos land package, the company is entering a new phase of exploration while simultaneously conducting a definitive feasibility study.
Additional assays from the same hole showed significant silver intercepts, including 13 meters at 307 grams per tonne and 8 meters at 446 grams per tonne in an upper silver-enriched zone. Another hole, DDH-25-021, intersected 5 meters at 92.5 grams per tonne of silver. These results, part of over 21,190 meters of drilling, will contribute to a resource update expected in July.
AbraSilver’s shares rose 6.7% to C$3.32 in Toronto, valuing the company at C$509.43 million. This follows a productive period for the company, which recently increased Diablillos’ net present value by 50% in an updated pre-feasibility study. The project hosts proven and probable reserves of 42.3 million tonnes grading 91 grams of silver and 0.81 grams of gold.
Analysis and Opinion: The mining sector, particularly gold and silver exploration, remains a hot topic amid global economic uncertainties and rising inflation, which often drive demand for precious metals as safe-haven assets. AbraSilver’s latest results position it favorably in this landscape, but questions remain about the scalability of these high-grade zones and the economic viability of deeper mineralization. How will the upcoming resource update impact the project’s feasibility, and can AbraSilver maintain this momentum in a competitive market?
Future Prospects
The company plans follow-up drilling at Oculto East to define the high-grade extension and assess its contribution to future development. The structurally controlled mineralization, hosted in the same breccia as the main Oculto deposit, suggests further potential at shallower depths, which could enhance the project’s economics.