Transcript
Automated transcript · Written by software from the replay's audio. It can mishear names and figures; the replay is the record.
0:08 Well, hello everyone and welcome to GR Silver's live summit today hosted by 6. I'm very pleased to introduce the chairman and CEO of GR Silver, Eric Sonsherb, who's going to provide us with some insight into the recent exciting results from the surface infill drilling program at the Palomosis Project. So just remember at any time you can submit questions using the Q&A panel on the right-hand side of the screen and we're gonna try to get to them after the presentation is over and as always the summit is being recorded and available to watch afterwards on
0:40 six.com but without any further ado I'm gonna hand it over to you Eric to kick things off. Great thanks very much for having me really appreciate it. So yeah let's dive into the presentation very quickly. We have a news release that came out on December 27th, and so I'll address what makes that important. We are GR Silver, ticker GRSL, and we have the Plumosas project here outlined in red. That is our core, 437 square kilometers in Sinaloa State in Mexico and we have in total 734 kilometers, so some really good non-core projects as well. So moving on, this is sort of an oblique view towards the east and you can see the Plumosis mine sort of top center.
1:27 That's the bold indicator there, the icon, and then 5 kilometers to the south, in other words to the right, is the Saint-Marciel project area. Saint-Marciel and Plumosus mine are 2 areas within the Plumosus project upon which we are focusing. The news release that we're talking about is actually focused on the Plumosus mine here. It's a former mine that produced 2.5 million tons and that particular area was under production in the 80s and 90s. So this is a section there and what we reported just the other day in our recent news release is in fact the results from drilling program that's going on, our first phase.
2:16 We're doing some drilling from the surface, very, very targeted infill drilling. We had 9 holes that were completed from surface and we reported an initial 6 from this year and 4 left over from 2021. And those 9 holes are very important. The reason is that the resource that we published last year in August had a relatively low silver equivalent grade that was much, much lower than the silver and silver equivalent from historical production. So we've got 8 kilometers of underground development here providing great access and flexibility and that production averaged about 190 grams per tonne silver and a smidgen under a gram per tonne gold plus or minus some lead and zinc. It was a lead and zinc mine.
3:05 And what these steel holes are targeted at is to look at the holes, the areas that were unsampled or undersampled due to lack of validation from historical holes and selective sampling as well, that left very large blank spaces at 0 grade in that resource area. And so what we're doing is looking to see What in these areas do we see in terms of grade? So if we look at, for example, this particular slide, if we 0 in on that particular slide, you can see areas that are light green. That light green indicates in the resource block model that they were grading 30 to 100 grams per tonne. And at 30 to 100 grams per tonne, that's not particularly a sort of economic kind of grade that one wants to see in a mine. But let's just 0 in for a second on the drill results that we published most recently.
4:06 So to your left here, you can see intersections like 13 meters of 410 grams, including 2.8 meters of 1323 grams, and 24 meters of 1094 grams silver including 60 centimeters of 7178 grams per ton. And we can see similar situations further to the center and then into the right where we have these low low in the block model and then we're getting really nice intersections dominated by silver mineralization north of 500 grams say you're even north of a thousand grams per tonne of silt. That's what's important here is that we want to demonstrate, and this is one of our 2 priorities, we want to demonstrate that the Plumosus mine area has grades considerably higher than the resource that
5:01 we published in August. This is a situation where someone's going to come in in a few years and say, ah, these people, they've only got 40, 60% of what they published. This is a very baseline resource. And so consequently, as we drill further here, we're going to move the needle in direction of production average grades.
5:24 Great, thank you so much for taking us through that update. We're going to open the floor to some questions and as those are coming in I was wondering Eric can you just please put the results from the PLOMOSA's mine in the recent news release into context? Why are they so important? Yeah, the key for us is to, to address those, those unsampled or undersampled areas. As you can see in this particular section, these light green areas and even dark green areas where we want to see these validated with holes to see what the grade might be. All right, thank you. Yeah, there's quite a few questions coming in here. One is from Gary asking, when would the resource estimate be updated?
6:12 We are committed to delivering a resource update for Plumosus as well as for our San Marcial area in the first quarter of 2023. And what is happening at the San Marcial area? Well, San Marcial is also very interesting. It's different than plumosis. At plumosis, we're addressing the grade. At San Marcial, this is a long section here and you can see at the top the hatched area that was the conceptual open pit for a resource and what we found is that there's a higher grade breccia, a core to this deposit that runs to depth. So unlike what some people had interpreted this as in the past, as a super gene enrichment, a superficial enrichment feature, we're seeing high grade roots. And so consequently, we're getting some very, very attractive grades.
7:10 Things like the intersections on here, you can see, let's see, we've got 18 meters of 773 grams in hole number 3, 38 meters of 299 grams. And these are all off of an underground platform on an adit, an historic adit that was
7:29 expanded here beneath that conceptual open pit. So San Marcial is very important from that perspective extending to depth. We're also, as you can see in this slide, the red outline here is of that conceptual open pit and we think that there's a very good potential to see the contact between the upper volcanics and the lower volcanics and the hydrothermal breccia that lives in that contact or proximal to that contact. We see the potential for extension further to the southeast along that contact. So we're quite excited about that potential as well. Great, thank you. We have a question here from Stig, he's asking, did Keith Neumeyer contact you about a buyout since the results yesterday? That's always a fun question. We purchased one of the 3 projects that came, or concessions that came together to create this project was purchased from First Majestic.
8:24 And so they ended up with a position in the stock. And so consequently people are speculating, Well, what does that mean?
8:32 Are they going to increase their position? Are they going to make a bid? Well, let's, I, as an analyst for 30 odd years, I never valued stocks on a takeout basis. It was always what fundamentally can the company deliver? We think that we can deliver significant expansion of our resource base here. Thank you. Eric, what can we expect from GR Silver going forward? Well, we have 3 rigs turning at Plumosa's mine area and we have 3 rigs turning at San Marcial. So with 6 rigs turning at that, in my opinion, will give us a very decent news flow. We can see that news flow projected through for the next few months and then ultimately ending up with a resource update that will encompass both San Marcial and Plumasas mine area. They're both about 5K apart. So 1 starts to look at them from an integrated perspective.
9:24 And I'd suggest to you that we have 2 concepts that we wanna prove here. One is that the Plumos's grade can increase. The other is that San Marcial's mass can increase. And so I think we're well on our way to providing proof of concept on both of those. Great, you just asked the first part of Craig's question, which is how many rigs are turning on site? But the second question is, are there any issues getting drill crews or SA delays? Well, I think in both cases, we're seeing that throughout Mexico and beyond. We have 6 rigs on site. I think it's possible to expand that. But you're right, having trained crews is important. And we have some really great people that we're working with coming from the AEDOs that are surrounding us. We have 3 AEDOs that we're dealing with and we have agreements with all 3 and they are providing really outstanding help in getting and keeping those rigs turning. With
10:24 regard to assays I think we've all seen that around the world that the assay turnaround time has been very very long. We've seen up to 8 weeks. I think that's coming down a little bit, a large chunk of that was related to COVID. And as this particular variant is dealt with, we'll see these turnaround times improve. Right. Absolutely. Eric, why is GR Silver trading at such a significant discount relative to peers? That's a great question. We delivered a resource in August of 2021 that was, I would say, disappointed some. And I mentioned that lower grade because of the challenges that were had in terms of validation of old drill holes. Another aspect is selective sampling on some of those drill holes. In other words, It was an old base metal mine. And so with a base metal mine, people were sampling the sulfides that they saw
11:21 at the hanging well contact and the footwell contact. And they left what was in between unsampled. So there's a great opportunity for us at Plumosis to demonstrate that there's mineralization. And as you can see from that April 27th release, very, very strong precious metals mineralization. So with that August 21 resource that was put out, the disappointed people, that moved us down. And you can see in this chart how we are very attractively valued compared to Mexican peer companies. We believe that as we demonstrate that the grade increases at Plumosis with infill drilling and we demonstrate that there's size expansion potential at San Marcial that there's an opportunity for a re-rating as we continue to drill and generate news flow.
12:09 Thank you. Gabriel's asking, can you go through how you know where to drill at Plumosas to continue getting the high-grade results you need to raise the overall resource grade? Well, I have to give credit to Marcio Fonseca, the founder and the president of GR Silver. He had the vision to put these 3 projects together to create the Single Plumosis Project. He's got a fantastic team starting with Trevor Wolf as our VP Exploration and Corporate Development and a fantastic team of young, talented Mexican geologists. And all together, the team benefit from a lot of historical data that came with these projects as we assembled this portfolio. In modern context, if you can put all this data together and use modern exploration techniques to augment that, you can generate an exploration model.
13:04 In our case, we are finding that we are being very successful in intersecting that mineralization. To be more specific, there's generally a north-south trending hydrothermal breccia that hosts polymetallic mineralization. The key is to recognize secondary and tertiary structures that crosscut that main body. And that seems to be where you get a significant increase of precious metal mineralization. Thank you so much. I was about to close up, but we got another question in here. Are you drilling the GAP area between San Juan and San Marcial? And second question is how much of this year's drilling will be targeted in this area? Yeah, the gap was a big part, a big motivation to making the La Trinidad acquisition.
13:53 And so, you know, very, very creatively, we called it the gap area in between the 2 existing concessions. But it is definitely demonstrated from geophysics and geochemistry that we're seeing a lot of those structures that we want to see both in terms of North, South generally, but also cross-cutting structures throughout that gap area. And so it's been a process of building road access into that area. There's been a little bit of drilling in there, but by far not definitive. And so will we drill further later on? I think of course we will drill there at a later point, but the key right now, the focus is the focus on San Marcial and Plumosis. That is the low hanging fruit in the Plumosis project. Great, thank you so much.
14:40 So I think that's all the questions we have for today. Of course, if any of you on the line do think of any questions following this summit, feel free to reach out directly to the GRSilver team and I'm sure they'll be happy to follow up with you afterwards. Their contact information is actually on the slide right here. You can also find more information on their website GRSilverMining.com. But before I close out, I'll pass it back to you, Eric, just for any final thoughts. Yeah, as a former analyst, we always wanted to see the 4 Ps. A project that has a lot of potential, which it does. The people that can make it happen, which I believe we do. We have a great supportive board as well. 3, the place, St. Hilo is an excellent place to work in. We've got fantastic infrastructure.
15:26 And then 4, we have a price, very, very attractive. Evaluation is very attractive, as I showed you on that slide. With free rating, we can fill in that gap on the valuation side. Great, well, thank you so much, Eric, for taking us through the update and the live Q&A, and thank you
