Silver X Mining Corp. (AGX:TSX.V) was afforded unrestricted access to explore and mine its Plata project through the just signed 15-year social agreement with the community of Carhuapata in Huancavelica, Peru, reported Red Cloud Securities analyst Timothy Lee in a May 24 research note.
This development follows a previous arrangement also pertaining to the company's flagship property in the Nueva Recuperada silver district. That agreement, finalized in November 2023, was with the Peruvian community of Huachocolpa, for 12 years, with respect to the Tangana mining unit, Red Silver and processing plant areas.
"Both agreements highlight the strong social support for Silver X's activities in the region," Lee wrote.
188% return potential
Given the news, Red Cloud maintained its CA$0.75 per share target price on the Canadian silver company, now trading at about CA$0.26 per share, noted Lee. This target implies a 188% potential return for investors.
Silver X remains a Buy.
With historical resource
Lee briefly described the explorer's Plata asset, noting that while it is a secondary project, "it could play an important role in Silver X's future growth plans.
The 3,829-hectare property has an existing historical resource consisting of 448,000 tons of 221 grams per ton silver, 2.55% lead and 4.58% zinc, containing 3,200,000 ounces of Ag, 25,000,000 pounds (25 Mlb) of lead and 45 Mlb of zinc.
This resource estimate is based on about 30,000 meters (30,000m) of drill core and 8,000m of underground samples indicating multiple high-grade silver and polymetallic veins are present.
"At least 17 known mineralized veins have been identified at surface, with widths ranging from 0.6-1.0m," noted the analyst.
What to watch for
Moving forward, Lee pointed out, Silver X intends to focus in the near term on Tangana, "where operational improvements and cost control measures have begun bearing fruit."
The company is aiming to update the mineral resource estimate for the overall Nueva Recuperada project by year-end 2024.
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