Fortuna finds more gold at Sunbird ahead of 2023 production at Seguela

Fortuna Silver Mines (TSX: FVI; NYSE: FSM) expects to pour first gold by mid-2023 at Seguela, an open-pit mine it is building in Cote d’Ivoire. In the meantime, the company continues to release exploration updates and drill results for the project and identify new regional prospects. 

Drilling down-dip and down-plunge at the project’s Sunbird deposit, for instance, has extended the mineralization associated with the central high-grade core a further 100 metres down-plunge, where it remains open at depth, about 400 metres below surface. 

Drill hole SGDD102 returned 5.1 grams gold per tonne over an estimated true width of 10.5 metres, starting from 373 metres downhole. The drill hole demonstrates the potential upside at depth, Paul Weedon, Fortuna’s CEO, said in a press release. 

Other highlights at Sunbird included drill hole SGRD1411, which cut 13.6 grams gold over an estimated true width of 6.3 metres from 332 metres, and remains open at depth and along strike; and drill hole SGDD095, which intersected 16.6 grams gold over 2.8 metres starting from 217 metres. 

The results “highlight the potential at the Seguela project, with Sunbird offering the potential to extend the life of mine by ramping down from the open-pit into the higher-grade core mineralization,” Jacques Wortman, an analyst at Laurentian Bank Securities, commented in a research note to clients. 

The recent drilling has extended the defined mineralized strike at Sunbird to more than 1.1 kilometres. In addition, an exploration trench 480 metres to the south along the projected strike intersected two zones of mineralization that have been interpreted from geophysics to be extensions of the Sunbird structure. The single exploration trench returned 3.8 grams gold over 7 metres and 1.3 grams gold over 9 metres. 

More drilling is planned in the fourth quarter of this year. 

In addition to the results from Sunbird, Fortuna’s regional target exploration program identified new high-grade prospects, including Kestrel, where drill hole SGRC1456 cut 24 grams gold over an estimated true width of 2.8 metres, starting from 87 metres. 

Kestrel is about 500 metres to the south along strike of Seguela’s Antenna deposit. Other highlights from a 10-hole, 1,137-metre first pass reverse circulation and diamond drill program at Kestrel included drill hole SGRC1452, which returned 13.2 grams gold over an estimated true width of 1.4 metres, from 78 metres downhole.  

The company noted that “regional geophysical interpretations suggest this structure may be a southerly extension of the structure hosting the main Antenna mineralization,” and more drilling is planned. 

“Drilling at Kestrel identified a new structure associated with strong silica and quartz veining,” Laurentian Bank’s Wortman noted. “Additionally, follow-up activities testing extensive surface gold anomalism at the G7 target intersected mineralization over a 200 metre zone, open along strike and at depth…” 

Results from a nine-hole 840 metre RC program at G7 included 2.2 grams gold over an estimated true width of 6.3 metres from 115 metres in SGRC1442.  

A 19-hole, 1,961 metre RC program at the Winy prospect returned 12.3 grams gold over 1.4 metres from 26 metres in drill hole SGRC1460 and 14.9 grams gold over 1.4 metres from 39 metres in SGRC1461. 

The company also reported results from a six-hole, 1,957 metre drill program at the Ancien deposit. The program was designed in part to test for mineralized extensions that “may be amenable to underground mining in the future,” the company said. 

Highlights of the Ancien drilling included 4.1 grams gold over an estimated true width of 11.9 metres from 328 metres, including 1.4 metres of 23.5 grams gold in drill hole SGRD1432 and 3.5 grams gold over 4.9 metres from 248 metres, including 11.7 grams gold over 0.7 metre in drill hole SGRD721.  

The company decided to build Seguela in September 2021. The mine will have a nine year lifespan based on reserves and in the initial six years is expected to produce 133,000 oz. gold a year. Annual production over the life of mine will average 120,000 oz.  

Once in operation, Seguela will be Fortuna’s fifth mine. The company has mines in Argentina, Burkina Faso, Mexico and Peru.  

Over the last year Fortuna has traded in a range of $2.86 and $6.95 per share and this afternoon in Toronto was trading at $3.37. The company has about 291.5 million common shares outstanding for a market cap of about $985.1 million. 

Wortman of Laurentian Bank has a buy rating on the company and a target price of $4.60 per share.