- Portfolio of attractive advanced silver projects
- Experienced management
- Among top five TSX venture silver juniors in terms of resource-base
What Aftermath Silver does:
Aftermath Silver Ltd (CVE:AAG) (OTCQB:AAGFF) describes itself as a junior explorer focused on acquiring, exploring and developing silver projects with an emphasis on Chile, South America.
The company says it wants to attract the market by amassing over 100 million ounces of silver with a portfolio of projects that remain 'cost positive' at around US$16 per ounce of silver. The firm also aims to buy advanced projects that are underpinned by existing resources.
Aftermath is acquiring the Challacollo project in Region 1, Chile, which lies 30 kilometres (km) east of the Pan American Highway. The project already boasts a historic NI 43-101 resource estimate from 2015 of 4.7 million tonnes for 30.2 million ounces of contained silver at a grade of 200 grammes per tonne (g/t) and 48,400 ounces of gold at 0.32 g/t in the higher confidence indicated category.
In the lower confidence inferred section there are 1.6 million tonnes for 6.9 million ounces of silver and 15,900 ounces of gold at a grade of 134 g/t and 0.31 g/t respectively. The company says that only the Lolon vein at the project is included in its previous resource estimate and that, on that vein, metallurgical recoveries were 92% silver and 75% gold.
Aftermath will have to pay vendor Mandalay Resources a total of C$7.5 million to acquire 100% of the Challacollo project. Mandalay currently retains a 3% net smelter return (NSR) on the project's production of up to C$3 million which reportedly works out at about C$0.20 an ounce or about 1% of the value of the silver in the ground.
Aftermath's second Chile project is the advanced Cachinal property, in Region 2, which is 40 km east of the Pan American Highway. Aftermath currently owns 80% of the project, with an option to acquire the remaining 20% from SSR Mining. Notably, Austral Gold's Guanaco mine lies 16 km to the south of the project, which has produced around 49,000 gold equivalent ounces per annum over the last four years.
In July 2020, Aftermath also told investors it was to buy the advanced Berenguela silver, copper project in Peru, also from SSR Mining. Berenguela is an epithermal polymetallic deposit. The project's total land package of 6,594 hectares. It lies 6 km from the town of Santa Lucia, which has railway access to the port of Matarani.
How is it doing:
On February 26, 2021, Aftermath Silver revealed that it had filed the NI 43 101 technical report carried out by AMC Mining consultants and Ausenco on the Berenguela silver-copper project. The document presented, among others, the details of land tenure, a summary of historic exploration work, and an analysis of Berenguela's drill hole database but did not outline a resource estimate or an economic study for the project in Peru.
Aftermath also clarified that the historic scoping study for Berenguela undertaken by the previous operator, which was disclosed in its July 2020 news release "should not be relied upon" as a qualified person has not classified the historical estimate as current mineral resources or mineral reserves.
Aftermath announced in November 2020 that it had struck an amended agreement with SSR Mining over the previously announced acquisition of Berenguela, with final closing of the deal expected on or before November 24, 2026.
The terms of the acquisition agreement were amended such that the total cash consideration payable to SSR Mining by Aftermath has decreased by US$275,000 from US$13 million to US$12.725 million. Also, in lieu of the US$275,000 cash, the number of shares in Aftermath Silver (TSX-V:AAG) issuable to SSR Mining had been increased to C$3,358,902.50 from C$3 million. This means an additional 458,077 Aftermath shares are issuable to SSR Mining at a deemed price of C$0.7835 per share for a total of over 4.28 million so-called payment shares.
Earlier in February 2021, Aftermath Silver revealed that fieldwork had commenced at the Challacollo silver-gold project in northern Chile, with field crews having commenced cutting and sampling of 3,200 meters of the previously unsampled historic core.
The explorer said the program is designed to test the material outside of the high-grade structures that formed the mineral resource estimate by sampling disseminated breccia style mineralization within the optimized pit shell that constrains the current mineral resource, adding that previous sampling of these drill holes was focused only on the Lolón Structure and visual sub-parallel structures.
Aftermath said it is also planning to undertake preliminary metallurgical leach test work on composites from the sampling program, and that the results will provide data to investigate the potential to bulk mine and potentially heap leach the lower grade material at Challacollo as well as, conceptually, to separately process the high-grade structures through an agitated leach flow sheet.
On December 15, 2020, Aftermath Silver had released a CIM compliant resource estimate for Challacollo. The latest resource showed a total of 6.6 million tonnes of indicated material (both open pit and underground) for 35.1 million ounces of silver at 165 grams per ton (g/t) and 58,000 ounces of gold at 0.27 g/t. In the lower confidence inferred category, the project hosts 2.8 million tonnes with 11.1 million ounces of silver at 124 g/t and 15,000 ounces of gold at 0.17 g/t.
The resource used a conceptual open pit and underground model to constrain the estimate, while the cut-off grade for the open pit was 35 g/t silver-equivalent, and for the underground was 93 g/t silver-equivalent.
And in September 2020, Aftermath also reported a CIM (Canada) compliant resource estimate for its Cachinal silver-gold project in Chile, showing 16.32 million ounces of silver in the higher confidence indicated category. Of those, 15.03 million ounces were in an open pit and 1.29 million ounces were underground.
On the financing front, in September 2020, the firm closed a previously announced upsized non-brokered private placement of 26,362,442 shares for gross proceeds of $17,135,587. The group noted that renowned investor Eric Sprott had increased his investment in Aftermath in order to maintain 19.61% of the company's issued and outstanding common shares.
The company said it intended to use the net proceeds for drilling and other technical studies on the Berenguela Silver-Copper project in Peru, and the Challacollo and Cachinal Silver-Gold projects in Chile, and for general working capital purposes.
Inflection points:
- Further news on Berenguela purchase
- Update on Challacollo fieldwork
- Precious metals moves
What the boss says:
In February's Challacollo fieldwork commencement statement, Aftermath Silver president and chief executive Ralph Rushton said: "Following the highly successful resource estimate which added tremendous value to Challacollo, the next phase of our concept for the project is to test the hangingwall sequence where historically only visible structures were sampled.
"This sampling program is an important next step in our exploration and engineering efforts at Challacollo. If successful, the program will help further refine the objectives of the planned drilling at Challacollo."
Contact the author at jon.hopkins@proactiveinvestors.com