WCE defines "one of Australia's highest-grade silver deposits"

Our silver exploration Investment West Coast Silver (ASX: WCE) just dropped its Maiden JORC Mineral Resource Estimate for the Elizabeth Hill Silver Project in WA.

WCE owns 70% of the old Elizabeth Hill mine that produced ~1.2M ounces of silver at an average grade of ~2,194g/t from just 16,830 tonnes of ore.

The mine shut in 2000 because silver was sitting at US$5/oz. Today silver is trading around US$77.50/oz.

Now, WCE’s defined a resource on the same project totaling 2.8M ounces at 617g/t from only 141,000t of material.

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The big change this time is that - the previous mining at Elizabeth Hill was primarily using underground mining methods.

The new resource is based on an open-pit mine design - meaning the 2.8M ounces of silver (at ridiculously high grades for an open-pit mine at ~617g/t silver) can be mined using far cheaper, technically complex mining methods.

Here is where the resource sits relative to the old workings on site:

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When we first Invested in WCE to see it do one of two things:

1. Drill out and identify silver resources in and around the existing Elizabeth Hill workings.
2. Drill out regional targets (and hopefully discover an Elizabeth Hill repeat).

WCE is currently in the middle of a drill program with two rigs looking to advance reason #1 above:

• 4,000m of RC drilling - testing extensions to the north of the old workings, AND
• 1,500m of diamond drilling - testing extensions at depth to the old workings.

WCE has an RC rig drilling to the north of today’s resource, and a diamond rig drilling for extensions at depth:

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Results from drilling could drop any minute (especially from the RC program which started back in late March).

We also note that new target WCE found just last week from Down Hole Electromagnetic (DHEM) surveys - a target that’s never been drilled before ~50m away from the old mine.

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So any confirmed discovery on that new EM plate could also be interesting…

All of the work WCE does will go into a scoping study that is targeted for Q4 this year.

More on today’s JORC resource

WCE’s Maiden JORC Resource now makes its project one of Australia’s highest grade silver deposits.

And it looks like the project can become a compact open pit mine (~200 m x 180 m, 130 m deep).

The resource also sits on a granted Mining Lease - which significantly reduces permitting timelines.

Mineralisation remains open along strike and at depth, with significant upside from near-mine and regional targets - so this silver resource in WCE could get bigger across a 180 km2 land package.

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The resource estimate is based on a pit shell only and on a silver price environment of A$85.71/ounce, so this gives us an early hint at what kind of silver price WCE is looking to produce.

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While the silver price has shown plenty of volatility recently, it currently is at A$108/ounce, so there is still quite a bit of wiggle room here.

Granted these would be based on assumptions and early workings that have not been thoroughly tested, we will need to wait for the official scoping study due earlier this year to get a better idea.

It is possible that the Scoping Study comes back with a higher silver price required (increased cost assumptions) to progress this into mining as things currently sit.

Here is a look at the pit shell in a 3D view from today’s announcement:

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WCE’s resource is underneath Australia’s highest grade silver mine, so getting some early cash flow from a relatively cheap and simple operation would allow for more aggressive exploration.

What we want to see next from WCE

In early April, WCE released an updated presentation here.

It’s always good to see a Gantt chart showing what’s ahead in these presentations - a one pager on what to expect next.

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The three things we are most looking out for are:

1. The RC drill campaign on the targets to the north of the Elizabeth Hill Mine (happening now).
2. The diamond drilling going for at depth extensions to the Elizabeth Hill mine (started last week).
3. Geophysics across the broader project area

And then all of that data rolling into what we expect to be an updated JORC resource before the Scoping Study before the end of the year, expected to follow in Q4.