Red Cloud Securities Positively Rates Silver’s Plomosas Project
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Red Cloud Securities Positively Rates Silver’s Plomosas Project

Photo by:   Artyom Korshunov
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Fernando Mares By Fernando Mares | Journalist and Industry Analyst - Tue, 03/14/2023 - 17:23

The Canadian mining investment bank Red Cloud Securities issued an analysis of GR Silver’s flagship Plomosas project in Sinaloa. The bank positively evaluated the project, as it has the potential for further gold production, and said that the company’s shares are set for an upward trend depending on the company’s reports, set for 1H23. 

Red Cloud highlighted that the Plomosas project, wholly owned by GR Silver, hosts three past-producing mines and plenty of operation targets with existing infrastructure along 75km of a prospective trend in a prominent silver-producing district. “With about 51 million oz of silver and about 138,000oz of gold in indicated and inferred resources, we believe there is still plenty of exploration potential on the property, in both known resource areas and new mineralized areas,” read the report. 

According to analysts, the project has the potential to expand resources to more than 114 million oz of AuEq in the near term. 

GR Silver conducted a drilling program in the San Marcial area in 2022, resulting in the discovery of a new mineralized high-grade area underneath the existing resource. The company noted that the area presented bonanza grades of over 1,000g/t of AuEq. “Additionally, drilling has intersected the first occurrences of gold in this area, supporting the hypothesis that there could be a potential new gold discovery here, greatly increasing the value of the project,” Red Cloud stated. 

Red Cloud identified two important factors that will drive the company’s stock value. The first is the forthcoming mineral resource estimate for the Plomosas project and the second is the release of the company’s 2023 strategic plan, which is expected to be ready by 1H23. 

Red Cloud gave GR Silver’s stocks a buy rating of CA$0.7 (US$ 0.51) price target, which is seven times higher than the current share price of CA$0.1 (US$ 0.073). The bank is optimistic that the company will perform well in the near term.

The Plomosas project has always been considered a strategic asset for GR Silver. At Mexico Mining Forum 2022, Marcio Fonseca, President and COO, GR Silver Mining, expressed his optimism in the early exploration stage. He said that the company is well-positioned for continuous value growth because of its focus on strategic assets that have historically yielded gold and silver mineralization.

Photo by:   Artyom Korshunov

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