AbraSilver jumps to record on Diablillos drilling results

AbraSilver Resource (TSX: ABRA; US-OTC: ABBRF) stock closed at an all-time high Tuesday after the miner said new drilling at its flagship Diablillos project in northwestern Argentina showed the presence of gold and silver zones beyond the deposit’s known limits.

Hole DDH 25-072 in the Oculto East zone cut 140 metres grading 0.57 gram gold per tonne from 262 metres downhole, including 8 metres at 2.6 grams gold from 338 metres depth, AbraSilver said Tuesday. In the JAC zone, hole DDH 25-053 cut 29 metres at 65 grams silver per tonne from 85 metres depth, including 7 metres grading 108 grams silver.

Tuesday’s results reinforce “the potential for expansion of mineral resources in the upcoming definitive feasibility study targeted for completion in the first quarter of 2026,” Scotia Capital mining analyst Eric Winmill said in a note.

Gold at Oculto East sits on the margins of the conceptual pit boundary, “highlighting the potential for upgrading mineralization along the pit boundaries to the measured category and enhancing overall project economics,” the analyst added.

AbraSilver shares jumped 4.9% to $7.53 Tuesday in Toronto, their highest closing level since the company went public in April 2017, TMX Group data show. That boosted the company’s market value to about $1.1 billion. 

Located in Argentina’s Puna region, about 160 km southwest of the city of Salta, Diablillos is one of the more advanced undeveloped silver-gold projects in South America, with year-round road access, nearby power infrastructure and more than 150,000 metres of prior drilling. AbraSilver bought the property, which includes 15 contiguous and overlapping mineral concessions, in 2016.

Continuous mineralization

Drilling at Oculto East yielded several broad zones of continuous gold mineralization, AbraSilver said.

Other highlights from the zone included hole DDH 25-069, which intersected 24 metres grading 1.02 grams gold from 243 metres downhole, and hole DDH-25-066, which intersected 6 metres at 2.23 grams gold from about 197 metres.

Hole DDH 25-058 at JAC cut 32 metres at 100 grams silver from 58 metres depth, AbraSilver also said.

Silver mineralization at JAC remains open to the south and west, according to the company. Both the tank and heap leach mineral resources could potentially be extended in those directions, AbraSilver added.

Expansion potential

“The potential to expand both gold and silver resources well beyond the current mineral resource conceptual open pit further demonstrates the scale of Diablillos and firmly positions us to continue delivering value through ongoing exploration and development,” CEO John Miniotis said in the statement.

The drill results come two months after AbraSilver released an updated estimate that boosted the project’s measured and indicated resources by 34% for silver ounces and 14% for gold.

The revised estimate includes 104 million measured and indicated tonnes grading 59.5 grams silver and 0.51 gram gold for 199 million oz. contained silver and 1.72 million oz. gold, the company said in late July. That compares to 76.2 million tonnes grading 60.5 grams silver and 0.62 gram gold for 148 million oz. silver and 1.51 million oz. gold in a November 2023 estimate.