Kootenay Silver/KTN

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Kootenay Silver Inc. (KTN:TSX.V) announced it has officially filed its National Instrument 43-101 technical report which supports the inaugural mineral resource estimate (MRE) for its wholly owned Columba silver project in Chihuahua, Mexico.

Dated August 1, 2025, with an effective date of May 29, 2025, the company said in a release that the report is accessible on SEDAR+ and the company's website.

Additionally, Kootenay the company announced the resumption of drilling activities at Columba this week, marking the seventh phase of drilling since 2019, aimed primarily at expanding the mineralized zones in depth and along strike.

"We are extremely happy with the first-ever mineral resource estimate at Columba," said President and Chief Executive Officer James McDonald. "Our drilling plan includes extension drilling on all mineralized structures still open in all directions."

Key details from the Columba property MRE include: The underground MRE, at a base-case cut-off grade of 150 grams per tonne silver (gpt Ag), comprises inferred mineral resources estimated at 5.92 million tonnes, with an average grade of 284 gpt Ag, 0.19% lead (Pb), and 0.50% zinc (Zn).  This estimate accounts for 54.1 million ounces (Moz) Ag, 25.2 million pounds Pb, and 65.6 million pounds Zn, excluding material from the mined-out F vein. The estimate encompasses 17 epithermal veins within the Columba vein system, the company said in a release.

Red Cloud Analyst Taylor Combaluzier wrote in an update on June 17 that the report is "the key catalyst that we were waiting for" for "one of our top silver picks."

"We view the maiden MRE as a key de-risking step for Columba," wrote Combaluzier, who maintained his Buy rating with a CA$2.80 per share target price. "The MRE came in slightly below our most recent 63.8M oz AgEq (silver equivalent) lower-case mineral inventory estimate, delineating ~57.7M oz AgEq using prices from our price deck. However, the ~303 g/t AgEq MRE grade was significantly higher than our ~137 g/t AgEq estimate, as we did not employ a cut-off grade. We continue to believe that KTN can achieve our updated mineral inventory estimates given the significant expansion potential along strike and at depth for all veins. We are also encouraged that a significant portion of the D Vein could likely be brought into an MRE relatively easily once drill spacing is tightened."

He continued, "Kootenay is undervalued on an EV/oz AgEq basis at US$0.14 vs. peers at US$0.83. We believe that expanding the resource at Columba and advancing it toward a PEA (preliminary economic assessment) would help close this valuation gap. Upcoming catalysts: 1) Columba 50,000m drill program results (2025-2026)."

A Classic High-Grade Epithermal Vein System

The Columba project features a classic high-grade epithermal vein system, believed to be a newly recognized vein district akin to other significant Mexican silver or gold deposits like La Chispas and Panuco, the company said.

Situated in a volcanic caldera setting, the surface extent of mapped veins spans approximately four kilometers by three kilometers. Vein mineralization is evident over a minimum vertical extent of 350 meters as demonstrated by drilling, with potential depths exceeding 700 meters yet to be explored. The veins intersect all known rock types on the project and can be traced across the highest points of the caldera, indicating they formed late in the caldera's history. As elevation increases, vein development becomes irregular, transitioning to breccias at higher elevations, with silver grades decreasing correspondingly.

Historically, Kootenay said the Columba site saw two periods of mining activity on the F vein, with initial operations in the early 1900s disrupted by the Mexican revolution and a brief resurgence around 1958 to 1960 by a small private company. Approximately 100,000 tonnes were extracted during these periods.

Kootenay Silver has conducted extensive exploration at Columba, including detailed mapping, lidar surveys, and airborne magnetic studies, along with over 53,000 meters of drilling across more than 200 holes. The company also said it has secured a 24-year surface access agreement covering all drilled mineralized areas, facilitating both exploration and exploitation activities.

Analyst: A Compelling Acquisition Candidate?

Research Capital Corp. Analyst Stuart McDougall wrote in a research update on June 17 that the estimate aligned with the firm's anticipations.

"Moreover, over one-half of the resources are contained in the higher-grading D vein, or three-quarters when the adjacent B veins (B2 and Lupe) and historically developed F vein are considered," McDougall noted.

Nearly half the D vein's strike length had insufficient pierce points for inclusion in the model, leaving what we think is considerable room for growth with additional drilling success, he said.

"Along that vein, the company notes that it plans to drill another 20,000-30,000 meters aimed at expanding the open-ended zones along strike and at depth," McDougall wrote. "Overall, we are impressed with management's ability to meet expectations right outside the gate and reiterate our SPECULATIVE BUY recommendation. Our target price of CA$2.70/share remains unchanged, based on our benchmark in situ metric of US$3/oz, adjusted for our future equity financing assumptions, priced in the context of the current market." 

KTN has observed that the veins have a steep dip of over 70 degrees and typically measure 5-6 meters across, McDougall noted.

"This leads us to believe there is potential to sustain an annual production rate of around 4 Moz at costs below US$15 per ounce, provided the recovery rates and unit costs are as reported," he wrote. "Should this be verified, we see KTN as a compelling acquisition candidate, especially considering its current trading price and the prospective gains from additional successful drilling."

In essence, the NI 43-101 has validated the initial resource estimate released on June 17, closely following the company's announcement of a CA$20 million bought deal financing on June 27, Senior Analyst Ted Butler wrote for The Gold Advisor on August 1.

To clarify, an "NI 43-101" is an independently verified report that assures investors of the legitimacy of a resource, serving as more than just an estimate from the company — it's essentially a geological stamp of approval, he wrote.

Moreover, Kootenay has just kicked off another round of drilling activities at the Columba project this week, entering its seventh phase since 2019, Butler noted. With a substantial 54 Moz silver resource already established, Kootenay is not resting on its laurels but is actively working to enlarge this resource.

"We’ll need to see more of where that came from on a consistent basis, but we believe with deep conviction that Columba will cross the magical 100 Moz silver resource threshold," he wrote. "With this strategic management team at the helm, and with a regular news flow of drill results to keep the market’s appetite satiated, the future certainly looks bright for KTN investors."

The Catalyst: Silver Shining as Demand Grows

Silver currently shines as a standout commodity, witnessing a revival in investor interest and strong fundamentals that have propelled its prices to the highest in 14 years, as noted in a Mining.com report dated July 31.

With impressive gains of 28% this year following a 21% increase last year, some analysts suggest that this upward trajectory is just the beginning, positioning silver as an attractive investment option, according to the report. Citigroup has recently upgraded its short-term outlook for silver prices to over US$40 per ounce, citing a tightening supply and rising demand.

The demand for silver continues to grow, particularly from various energy sectors, highlighting its crucial role in technologies essential for the expansion of global electricity needs, including solar power, electric vehicles, and electronics.

The white metal opened the week trading between US$36.98 and US$37.20 per ounce, experiencing a slight decline of just over 3% over the past seven days, reported Jamie Redman August 4 for Bitcoin.com.

Ownership and Share Structure

According to Refinitiv, nearly 1% of the company is owned by insiders and management, and about 10% is owned by institutions. The rest is retail.

Top shareholders include Sprott Asset Management LP with 4.37%, Konwave AG with 4.23%, Alps Advisors Inc. with 07.3%, the CEO McDonald with 0.57%, and AIPM Azure International Portfolio Management with 0.54%.

Its market cap is CA$93.96 million with 81.7 million shares outstanding. It traders in a 52-week range of CA$0.84 and CA$1.55.