SS1 receives regulatory approval for 90 additional drill pads
Our 2024 Small Cap Pick of the Year Sun Silver (ASX: SS1) just received regulatory approvals to increase the size of its 2025 drill program in Nevada, USA.
SS1 is currently in the middle of its 2025 drill program and after today’s news will be able to add 90 additional drill pad locations to support a bigger drill program.
SS1’s project currently has a 480M ounce silver equivalent JORC resource - the biggest pre-production silver resource in the USA and on the ASX.
With it’s 2025 drill program, SS1 is aiming to:
1. Upgrade the JORC resource - SS1 is drilling extensional holes to the north-west of the project. Our last note covered the assay results from the first extensional hole here.
Read our note on the assay results from SS1’s first drillhole here: SS1: Announces 70m intercept with a 10,548g/t silver equivalent interval… outside of its 480 million ounce JORC resource
2. Increase the classification of SS1’s resource - SS1’s existing JORC resource estimate is currently 100% in the inferred category. SS1 will be drilling in-fill holes to try and upgrade that classification into the indicated category.
(🎓Read more about JORC resource classifications here)
3. Run metallurgical testwork programs - SS1 will also drill a few drillholes to get samples that can be metwork tested. Metwork tests will show the market how SS1’s deposit could be processed - here we are hoping to see conventional processing methods work on SS1’s project.
(Source)
Five major catalysts we are tracking for SS1
On January 14th this year, we shared what we think needs to happen for the SS1 share price to go on a run in 2025 (read it here).
(of course like any small cap stock, a lot needs to go right for the SS1 share price to go up - it's never a guarantee.)
Here is an update on how all of those catalysts are tracking so far:
- Silver price runs - if the silver price runs, then we expect SS1’s share price to follow. The silver price could run due to a hedge against persistent inflation or industrial demand.
🚨 Update: Silver has since moved up ~20% from US$29.90 to US$36/oz. In the last four weeks the silver price has moved sharply, testing highs of US$37/oz. - More silver discovered from drilling - after today’s assays, we think it is clear where SS1 should drill next. If SS1 can continue to build on this identified silver mineralisation, we think that it could follow a similar path as Spartan Resources - which discovered and defined a giant gold resource in a short period of time.
- SS1 silver resource update - If SS1 publishes a JORC resource update that increases the level of confidence in the project and the size of the silver equivalent resource (above investor expectations), this could be a big catalyst for the company.
- Antimony surprise - SS1 could publish an antimony resource by re-assaying historical drill cores that were not tested for antimony. On top of this, if SS1 is able to secure any US DoD funding for this project (it happened for Perpetua - more on this below) it could be a big signal to the market that SS1’s project is of ‘strategic importance’ to the US Government.
🚨 Update: SS1 has commenced its large-scale re-assay program. The results of this program could help the company build an antimony resource, and catch the eye of the US Government. - SS1 hits market cap/trading volume requirements to get into an index - Once a company enters an index then ETFs and index tracking funds may be required to buy up the stock for their ETF or tracker funds. This opens up a whole new market of potential investors that tends to be more patient and more predictable than active retail investors.
🚨 Update: SS1 is currently trading at ~$117M market cap, we would want to see a sustained period around the $200M position for inclusion into an ASX index.
Of course it is worth noting, there is no guarantee these catalysts will have an impact on SS1’s share price.
To see a full set of risks to our SS1 Investment Thesis check out our latest note here.
