GR Silver (GRSL.V) holds 100% of the key concessions over an area 25 kilometers wide and 35 kilometers long in the Rosario District in Sinaloa Mexico. The company refers to this as the Plomosas Project and is in the midst of drilling the property.
“We have a pipeline of targets,” said Marcio Fonseca, GR Silver’s CEO. “We think we are close to discoveries. We currently have six drills turning; three of which we own.”
“These are reconnaissance holes,” said Fonseca. “Some of these areas have never been drilled and we need the reconnaissance holes to figure out the geology. These are fairly shallow holes, 250-300 meters.”
“We’re really happy with the rock we are seeing,” said Fonseca. “We have to wait seven or eight weeks for the assays, but we are seeing sulphides and veins.”
“There are historical workings all over the area. The district goes back to 1700,” said Fonseca. “There was only one actual mine. The workings are mainly artisanal. And First Majestic drilled some holes as well.”
With all of the surface workings, the encouraging rock from the drill holes and the First Majestic work Fonseca is excited. “This is a large system. There is lots of “smoke”. There should be a fluid source underneath which is feeding all this.”
Fonseca who is both a professional geologist and a former investment banker is famous for asking the essential question, “Is it a mine?” It is the foundational question for any junior exploration company. But there is another question which Fonseca is asking as he explores the Plomosas Project, “Is it a discovery?”
“Discovery” is a term of art for geologists. In simple terms, a discovery occurs when enough geological data has been obtained to delineate a new large, mineralized, structure. One which could amount to a new resource.
“We are drilling up in the underexplored North West corner of the property which is about 4 kilometres by 4 kilometres,” said Fonseca. “Five targets which are outside our current resource. We’re looking for breccias, we’re looking for discoveries.”
GR has one, very significant, advantage: an underground drilling station at San Marcial. “This is a big underground drill station,” said Fonseca. “We are drilling outside of the mineral resource. About 100 meters below.”
The company hopes to extend the San Marcial hydrothermal breccia down dip and it wants to explore the sulphide-rich volcano-sedimentary unit in the footwall of the existing mineral resource. On the one hand, this is very much new territory, on the other GR has geophysical anomalies (magnetometry, chargeability and resistivity) which suggest these geological structures may host significant silver and gold. Being able to drill from underground means that the drill can test prospective structures directly without having to come down from surface.
Of course, GRSL has faced challenges at Plomosas. Starting with the fact there is a wet season. Here’s what Fonseca said in his update: “Despite a number of seasonal setbacks out of the Company’s control, we have successfully advanced our reconnaissance drill program, completing 5,500 m to date of the proposed 14,000 m program.” The wet season is, more or less, over.
The company has also had to deal with the effects of COVID. “The region was not hit hard,” said Fonseca. “There was a wave three months ago and we have to be careful. We currently have two nurses on-site and fortunately, we have never had a case. But it is the new reality.”
“Now we are able to travel more easily,” said Fonseca. “Mexico is very friendly and the vaccine has been a big plus.”
Fonseca is always worth asking about the precious metals markets, “I am hoping that silver detaches from gold,” said Fonseca. “A silver bull could push the price to $30-35.”
For now, GRSL will continue to explore the Plomosas project. The company is well funded, has an excellent geological and drilling team and many kilometres left to explore.
“The company controls the whole district,” said Fonseca. “We know it is a large system. We are not going to run out of mineralization for years.”