Is it fair to say that silver is the great unsung hero of the greening of the global economy?
It just might be.
Where lithium and cobalt and to a degree even copper and nickel are lauded with plaudits, sentiment towards silver is still stuck in a twentieth century mindset that splits its appeal between investment asset and its old-time use in photographic materials.
With the advent of the digital era, demand for silver from the photographic industry has dropped away substantially.
But what most people don’t realise is that silver is an essential component in all electronics, including, yes, electric vehicles, and yes, solar panels.
This is the way well-known mining consultant CRU puts it, in a report compiled towards the end of last year on behalf of the Silver Institute:
“Silver is found in nearly all electronic devices,” said CRU.
“With the greatest electrical conductivity of all metals, silver is playing a critical role in the latest technological advancements. Silver’s inherent conductivity is an important asset in the miniaturization of electronics; allowing electrical currents to flow in even the smallest semiconductors and computer chips.”
So silver is as key to the green revolution as any of the other more widely touted metals, only with one key difference – the market hasn’t really woken up to that fact yet.
It’s this thinking that in part informs the vision of the directors and backers of Silverton Metals Corp (TSX-V:SVTN, OTCQB:SVTNF), a company with a sizeable portfolio of assets in what has to be considered the world’s number one silver destination: Mexico.
“Silver is growing in importance in the green economy,” says Silverton’s chief executive John Theobald.
“And at the same time there’s been a lack of new discoveries and falling production from primary silver mines.”
Taking all those dynamics together, and it’s only a matter of time before what they call a perfect storm starts brewing up.
If it does, Silverton will be ready.
It has three main projects in Mexico, Peñasco Quemado, La Frazada and Pluton.
The immediate focus is on Peñasco, where the company is currently drilling, and from which results are anticipated in March.
These results will build on a 9.63mln ounce silver resource that’s already been established closed to the surface and which looks eminently open-pittable. Overall, Peñasco covers a pretty sizeable surface area, and it’s possible there may be significant other opportunities on the licence which haven’t yet been properly investigated.
All of which means there’ll be plenty of news for the market to look forward to in the near-term.
However, the main asset, or the “headline project” as Theobald calls it, is the Pluton project.
“Pluton is a large, district-scale exploration project targeting silver, zinc and gold,” he says. The company has conducted various surveys over this ground already, the latest of which has involved seismic techniques more commonly used in the oil and gas industry.
And there’s no doubt that Pluton is in the right neighbourhood.
Just to the south lies a historic mine, known to be around 350 years old, the production from which established the famous Mexican mining company Peñoles in the early 1900s.
To the east lies Mexico’s highest grading silver mine, the Platosa project, operated by Excellon, which yields ore grading up to 2,500 grams per tonne.
Will something similar turn up on Pluton?
Certainly that’s the aspiration, although much work needs to be done before anything definitive can be said.
“It’s an early stage but the company is advancing it quickly,” says Theobald.
“There’s lots of cover, and we have to use geophysics. But if we’re successful with this project it would be transformational for the company.”
Theobald’s idea of success in this context? – “you could have something ranging from five million to between twenty and thirty million tonnes,” he says. “And the potential for the sort of grades you see at Platosa.”
Specifically, Silverton is targeting what are known as manto and chimney deposits.
“These things are potentially very large,” explains Theobald.
“And they may be quite irregular orebodies. But once you have a hit you can follow them around. They can extend from a couple of hundred metres to a kilometre. They are the potential prize.”
It might take a while for the momentum to build though. The next news will be the results of the seismic surveying, due out in March.
“After that we’ll collate the data and come up with targets,” says Theobald. “We’ll be thinking about where to put our first hole in the third quarter of this year.”
In the intervening period, though, there’ll be newsflow from La Peñasco to keep the market interest ticking over, and no-one’s going to be fretting about dilution or discounting fundraisings any time soon.
As it stands, there’s C$3.5mln in the bank, which is plenty enough to allow Silverton to get on with its plans and steer the company firmly into the direction of the upcoming bull market in silver.