VSA Morning Miner, 07/04/21

Prime Mining (CVE:PRYM)

Prime Mining (CVE:PRYM) has followed up with further strong exploration results from Los Reyes although this time the 13 holes were from within the areas with greater known resources, Zapote South, Noche Buena and San Miguel East. These results show PRYM is doing what it set out to do both in terms of expanding the resource footprint and increasing confidence.

At Zapote South eight results were returned which were primarily in-fill holes to better understand structural controls, the location of higher grade zones of mineralisation as well as reducing spacing between holes to move to higher confidence categories. Furthermore, we have previously highlighted the underappreciated potential of silver and with the latest assay data confirming the presence of silver in areas it was not previously recognised in the block model, PRYM will be able to increase resource silver grades and ounces benefitting projected future economics. We see further gains from higher silver prices and stronger recoveries also contributing to a larger silver contribution to the resource. Highlights from Zapote South include;

21ZAP-03 13.0 m at 0.76 gpt Au and 33.0 gpt Ag, including 1.66 gpt Au and 41.5 gpt Ag over 4.6 m from 140m extending the deposit 35m down dip.

21ZAP-04 11.7m at 3,68g/t Au and 41.5g/t Ag including 8.95 gpt Au and 74.5 gpt Ag over 4.5 m from 109.5m

Noche Buena drilling focused on step out holes and the four holes each intersected the main mineralised structure expanding the strike length 25m and down dip 20m, however, the structure remains open. Highlights included;

21NB-02: 39m at 0.7g/t Au and 29.5g/t Ag from 91.5m including 2.85m at 3.17g/t Au and 141.2g/t Ag. True widths are thought to be closer to 25m and 1.85m respectively.

21NB-03: 7.5m at 0.78g/t Au and 635.2g/t Ag from 100.5m.

At San Miguel East only one hole has so far had assay results returned intercepted 4.5m at 1g/t Au and 130.7g/t Ag from 218m; this is a 50m step down and intercepted mineralisation 10m below the current open pit resource demonstrating further near term potential to expand the compliant resource figure.

As the early drilling results from Phase 1 come in and confirm PRYM’s understanding of the deposit greater risk can be taken with the next sets of drill holes and with that comes the potential for greater rewards in terms of extensions, new structures and further high grade zones. The detailed level of understanding and evaluation at this stage is strengthening the platform for growth and further enhancing the risk reward ratio, in our view.

We reiterate our Buy recommendation.  


Oliver O’Donnell, CFA, Head of Research & Natural Resources Analyst | T: +44 (0)20 3617 5180 | E: [email protected]
Paul Renken, Senior Geologist | T: +44 (0)20 3005 5011 | E: [email protected]

VSA Capital Research | T: +44 (0)20 3005 5000 | E: [email protected]

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