Panuco to Spearhead Sinaloa’s Mining Drive: Vizsla Silver

Q: What value does the acquisition of the Santa Fe project bring to Vizsla Silver’s portfolio? How does it align with the recent acquisition of the La Garra-Metates district?

A: The recent Santa Fe project acquisition was driven by Vizsla Silver's desire to continue expanding its territorial position in Mexico. We strongly believe in Sinaloa and its mining potential, as it is important to showcase the state's value nationally and internationally.

Santa Fe is a key acquisition, located immediately adjacent to our assets, El Richard-San Enrique, which were acquired after our main Panuco-Copala site. The Santa Fe land package features a 350t/d mill producing mine. However, for Vizsla Silver, it holds the potential to boost our production profile significantly beyond 20Moz. Our current plan for Panuco-Copala, with its production budget published in 2025, targets around 170Moz of inferred silver. This new acquisition elevates our potential considerably further.

Santa Fe offers significant exploration potential with its 12,200ha located on the same mineralized trend as our existing properties, connecting with and enhancing the potential of El Richard and San Enrique. It is also worth mentioning La Garra, an asset we are holding in reserve. We have not yet focused on La Garra, but prior prospecting work has confirmed its considerable potential.

Our strategy is essentially to continue expanding our portfolio within Sinaloa and Mexico more broadly, while maintaining our focus on silver as our principal product. 

Q: The company’s 2025 outlook centers on de-risking the Panuco project for a 2027 first silver pour. How does Vizsla Silver define "de-risking" in this context, and what are the most critical de-risking initiatives planned for 2025?

A: De-risking involves eliminating actual obstacles rather than just addressing potential future risks. Our first step is always to secure our main asset. To that end, we presented a Preliminary Economic Assessment (PEA) last year, followed by a Feasibility Study (FS). In 2025, we are focused on obtaining permits. So, de-risking is primarily about removing these obstacles to allow project development to proceed.

We collaborate closely with key sector organizations, including CANCHAM, CAMIMEX, and the Sinaloa Mining Cluster, in our engagement with authorities like SEMARNAT. Together, our collective aim is to underscore the importance of responsible mining in the state and to demonstrate that clean, sustainable practices are achievable.

Security is an important aspect of the project. Sinaloa has faced scrutiny due to insecure conditions over the past year. We have been collaborating with the State government in this aspect to ensure security conditions for the project. One advantage of our project is its proximity to Mazatlan and its airport, which offers certain logistical advantages against insecurity.

All these efforts contribute to de-risking our project, specifically by removing impediments to expedite the commencement of our planned operations.

Q: What are the biggest challenges anticipated in finalizing Panuco’s feasibility study, and what outcomes or insights are expected from its completion?

A: The upcoming Feasibility Study (FS) will allow us to establish a starting point with greater certainty. Subsequent drilling has further increased our resource base. We are now undertaking all design work for the planned underground mine, basing these designs on the resource update completed in January 2025. This updated resource differs from that used in the PEA, which was based on different parameters. Our goal is to adjust accordingly and, once engineering designs are completed, proceed to construction and production.

Alongside ongoing studies, we have already submitted our environmental permit application for approval. We are using this time to advance other project elements. This is also part of our de-risking strategy, we are not waiting for the environmental permit to be granted to advance subsequent stages, such as the FS. Thus, we are proactively managing our timeline, aiming to keep everything on schedule to achieve production in 2027.

Q: So far, what are the most promising exploration targets within the Panuco project? 

A: Initial development at our Panuco project has centered on the Napoleon and Copala structures, which now form our core asset. Even this core asset area was only about 30% to 35% explored, mainly towards the southwest. This left 65% with exploration potential. However, factoring in our recent acquisitions, the portion of our total land package that has been explored is reduced to only about 10% to 15%. Consequently, we now have a vast area, roughly 85% of our holdings, that requires systematic exploration.

We remain focused on the Napoleon and Copala areas to add further value and resources, which will be converted into reserves once the FS is complete, thereby increasing the value of our initial core asset. We are also beginning to explore the central part of the district in the Animas zone.

Animas is one of our satellite targets. Beyond Animas, we have identified mineralized corridors, some potentially analogous to productive districts like San Dimas, which could be very interesting and will continue to extend the project's life and enhance company value, as we plan to develop these as individual operations. It is also important to highlight that with the Santa Fe acquisition, its previous owners had focused solely on the existing mine, leaving the remainder of that property essentially unexplored. We see immense potential to develop areas around the current mine and establish additional satellite deposits.

Q: How have security conditions in Sinaloa impacted Vizsla Silver’s work and what measures has the company taken to protect its workforce?
A: Working with communities is key. Establishing clear, effective, and honest communication from the very beginning of the project has been crucial for us. This involves being transparent, showing our plans, detailing our activities, and sharing publicly available information, which results in building trust with community members.

I believe the support and recognition we have earned from the community, through our various programs such as health fairs and other initiatives providing direct benefits, have been instrumental. This has helped us avoid being significantly impacted by the security incidents occurring in the state and across the country, as this is not unique to Sinaloa. The trust the community places in us is a key part of this.

Close engagement with government entities is also essential. We maintain open channels of communication, keeping authorities informed of all our activities. While we recently restarted some activities, we did not cease operations entirely. Activities in Concordia have continued, and salaries were never halted. Our company deeply respects its workforce and aims to avoid disruptions due to insecurity. 

Q: What are Sinaloa's key advantages that make it an attractive region for mining investment, particularly for exploration projects?

A: Sinaloa’s infrastructure is a key positive point. For instance, at Vizsla Silver, we have easy access to the site and essential services at very short distances, including electricity, communication routes, energy, water, and local services. Sinaloa itself is well-connected to the rest of the country, not only via the Mazatlan-Durango highway but also through routes connecting south to Nayarit and Jalisco, and north to Sonora and Chihuahua. Furthermore, Sinaloa, being a maritime port state, offers numerous logistical advantages and an available workforce.

As a traditional mining district, Sinaloa has a deeply ingrained mining culture. It is not difficult for local communities to engage in mining work, as their ancestors, even dating back to the Spanish colonial era, with figures like Francisco Ibarra, were dedicated to this activity.

The main asset for investors is that Sinaloa remains significantly underexplored. This means the potential for discoveries is enormous. Exploration companies operating around our area are finding not small deposits, but very significant ones with very promising results, involving not only silver but also gold, copper, and other metals.

I am sure Sinaloa will become a key mining actor in the short to medium term. Other Mexican states with a long history of large-scale mining are now largely depleted in terms of near-surface exploration potential; further exploration there must target deeper deposits, which are very costly. In contrast, Sinaloa, with its port, communication routes, and infrastructure, is much more attractive for both production and exploration investment.

Q: How strong are Sinaloa’s local workforce and supply chain capabilities to support projects like Panuco?

A: We project sourcing for the current stage as 30% local, 50% national, and 20% foreign. This 20% foreign procurement is mainly for specialized machinery, with the percentage indicating the need for specific available items, not necessarily its share of the overall investment. The remaining 90% will thus be sourced within Mexico from local and national suppliers.

We distinguish carefully, because some suppliers presented as “local” are actually national chains, like safety equipment companies with nationwide branches, which we classify as national. For us, a truly local supplier develops practically within the host communities, such as food and fuel suppliers, or the various local logistics services needed throughout the project stages.

The construction phase, lasting at least a year, will generate significant local activity. All this local procurement and labor will have an impact, not only on Vizsla Silver’s direct needs but also on the secondary needs of our local suppliers themselves, creating a broader spill-over effect.

Q: What are Vizsla Silver’s plans for 2025?

A: We will focus on the test mine, essentially a bulk sample. As an advanced exploration project, our purpose is to confirm predictions made during the PEA regarding the model and the mineralized body. Successfully developing this program and extracting the 10,000t high-grade sample from the Copala orebody enhances investor confidence and our internal certainty. We are also developing our FS and waiting for the required permits to move forward.

This year is therefore crucial for Vizsla. While advancing the core project, we continue exploration around the project area and in its peripheries. Our exploration aims to identify future developable projects, not merely to publish resource values. With the Santa Fe asset, we also anticipate good momentum this year, as we plan to announce the commencement of exploration there once the acquisition is finalized.

The permitting process is expected to take the entire year. We are also focused on constructive engagement, as this government has shown considerable openness, which we view positively, creating an open door for dialogue. This allows us to explain our project thoroughly, including its components and implications, countering misconceptions that mining is merely extraction or causes pollution. This administration understands these nuances and has, in turn, presented us with key pillars to address, such as water management, community engagement, and research initiatives. Presenting our plans and demonstrating correct operational conduct fosters greater openness to dialogue and project acceptance.

This project also has significant potential, in terms of silver production, to further elevate Mexico's already prominent international standing as a major silver producer. I believe the Panuco project can significantly enhance Mexico's reputation in this regard, which would undoubtedly be a source of pride for Sinaloa.

Historically, Sinaloa was not as prominent as Chihuahua, Sonora, Zacatecas, or Durango, known for major mining districts and mature mines. Elevating Sinaloa's profile through Vizsla Silver is one of the greatest motivations I have. We will continue our efforts until Sinaloa is fully recognized for its deposits and development, securing its place on Mexico's production maps. 

Vizsla Silver is a Canada-based mineral exploration and development company. The company is focused on developing its 100%-owned Panuco silver-gold project in Sinaloa. The company has drilled over 350,000m at Panuco, uncovering several high-grade veins.