Silver-Gold Explorer Hits High-Grade Bonanza in Salta

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AbraSilver Resource Corp. (ABRA:TSX; ABBRF:OTCQX) has reported its most significant gold intercept to date at the Diablillos project in Salta Province, Argentina. The drill result came from step-out hole DDH 25-024, part of its ongoing Phase V exploration program targeting extensions of the Oculto deposit. According to the company, the hole returned a standout interval of 31.0 meters grading 10.0 grams per tonne (g/t) gold and 16 g/t silver, including 6.0 meters at 41.9 g/t gold and 22 g/t silver. A separate intercept in the same hole returned 13.0 meters at 307 g/t silver, including 8.0 meters grading 446 g/t silver. All assays were uncut and undiluted, and true widths are currently unknown.

The Diablillos project, acquired by AbraSilver in 2016, comprises 15 contiguous concessions and has seen approximately 150,000 meters of drilling. It hosts epithermal silver-gold mineralization with associated breccia-hosted zones, primarily at Oculto, JAC, Sombra, and Laderas. The company believes the latest intercept, located just east of the existing Oculto open-pit boundary, indicates high-grade mineralization continues along strike and at depth.

"This extremely impressive hole confirms that the deeper gold zone extends beyond the known mineralized boundary at Oculto," said Dave O'Connor, Chief Geologist, in a company news release. "Our team will immediately commence a systematic drilling program in the area to follow up on this robust initial result."

The Diablillos project's current Proven and Probable Reserves stand at 42.3 million tonnes grading 91 g/t silver and 0.81 g/t gold, for a contained total of 123.5 million ounces of silver and 1.1 million ounces of gold. The December 2024 pre-feasibility study, based on prices of US$25.50/oz silver and US$2,050/oz gold, estimated a Net Present Value at a 5% discount (NPV5%) of US$747 million with an after-tax internal rate of return (IRR) of 28%. The operation would have a 14-year mine life with average annual production of 13.4 million silver-equivalent ounces over its life, and an all-in sustaining cost (AISC) of US$12.67/oz AgEq.

The Diablillos site has established infrastructure, water access rights, and ongoing Environmental Impact Assessment (EIA) submissions. AbraSilver has also reported favorable metallurgical results, with life-of-mine recovery rates averaging 84% for silver and 87% for gold.

Precious Metals Sector Sees Diverging Trends as Gold Leads and Silver Eyes Catch-Up

According to a May 13 report published by The Silver Academy with Ray Dalio, the abandonment of the gold standard more than five decades ago marked a turning point that continues to shape global financial markets. Dalio's discussion centered on the implications of the 1971 "Nixon Shock," when the United States decoupled the dollar from gold. This, he stated, fundamentally "set the stage for a new era of fiat money, global financial volatility, and a dramatic shift in economic power." In historical context, he noted that gold prices surged in the years that followed and observed that the US dollar has lost more than 87% of its purchasing power since the gold window was closed.

A special report published on May 15 by Stockhead highlighted silver's position within the current precious metals landscape. With the gold-to-silver ratio sitting near a rare historical high of 100, silver was seen trailing gold in performance. The report indicated that this imbalance could suggest a reversion in which silver prices rise to close the gap. Roscoe Widdup of Triple Eight Capital remarked that "we saw prices hit US$48/ounce in 2011 and there is no reason why this level isn't possible," pointing to inflation-adjusted targets exceeding US$70 per ounce. Additionally, the article pointed out that silver demand is expected to remain strong due to its industrial applications, particularly in the solar sector, which accounts for roughly 20% of industrial silver demand. Despite record production levels, the metal was forecast to face a fifth consecutive annual supply deficit in 2025, totaling 117 million ounces.

In a May 20 video from CPM Group, Jeffrey Christian emphasized that while gold and silver markets had been strong during the first four months of the year, they showed signs of volatility heading into mid-year. Christian noted that gold reached US$3,236 per ounce, while silver hovered near US$32.52. He attributed part of gold's recent strength to geopolitical concerns and Moody's downgrade of US Treasury securities, which briefly lifted gold prices by US$50. However, he described this influence as likely short-term. "There are a lot of spring storms on the radar," Christian said, referring to unresolved political, economic, and military risks globally. These include ongoing conflicts in the Middle East and Ukraine, unresolved tariff policies, and rising deficits, all of which could continue to drive investor demand for precious metals.

At the same time, Christian highlighted diverging trends in investor behavior. While gold exchange-traded funds (ETFs) have attracted inflows from new investors, silver saw ongoing liquidation from holders who purchased during the Wall Street Silver movement in 2021 and 2022. He pointed out that many of those investors were now selling into strength as silver returned to levels above US$30, creating headwinds. Still, he noted that long-term fundamentals such as solar industry demand and retail investor re-entry could support silver prices over time.

Analysts Highlight Strong Upside at Diablillos

On May 2, Don DeMarco of National Bank of Canada released insights from a recent site visit to AbraSilver's Diablillos project, reaffirming his Outperform rating and CA$5.75 target price. At the time, shares were trading around CA$3.06, implying an 88% return. DeMarco cited Argentina's improving investment environment under President Javier Milei, specifically highlighting the Régimen de Incentivo para Grandes Inversiones (RIGI) as a key jurisdictional benefit. He wrote, "Our Outperform thesis remains unchanged," supported by a large Measured and Indicated resource base, high-grade targets such as JAC, and "heightened mergers and acquisitions appeal."

On May 5, DeMarco issued a follow-up report analyzing the final assay results from Phase IV drilling. He described the results as "splashy infill intercepts over wide intervals with readthrough for resource derisking," pointing to highlights such as 65 meters grading 161.6 g/t silver and 63 meters grading 138.6 g/t silver. Despite some lower average grades, he noted that the wide intercepts supported ongoing project de-risking and maintained the CA$5.75 target.

Also on May 5, Eric Winmill of Scotiabank commented on the same Phase IV drill results. He stated, "We view this news as positive for AbraSilver shares as we see potential for resource expansion based on drill success to date in areas located near planned mining areas and infrastructure." Winmill reiterated an Outperform rating and CA$5.50 target price, noting this reflected an 85% return from the then-current trading price of CA$2.98.

Positioned For Growth: What's Ahead For AbraSilver

As outlined in its investor presentation, AbraSilver's current 20,000-meter Phase V drill program is fully funded and focused on expanding known zones and discovering new high-grade mineralization, particularly in areas such as Oculto East, Oculto Northeast, and the JAC extension. The company reported that mineralized structures identified in hole DDH 25-024 are hosted in breccias similar to the main Oculto deposit and remain open to the east.

Looking forward, several major catalysts are expected within the next 12 months. These include the release of an updated resource estimate in mid-2025, approval of EIA permits, and completion of a Definitive Feasibility Study. Management also aims to qualify the Diablillos project for Argentina's RIGI (Régimen de Incentivo para Grandes Inversiones), which offers significant economic benefits for projects exceeding US$200 million. These benefits may include a reduced corporate tax rate, elimination of export duties, and a 30-year tax and customs stability agreement.

Exploration efforts are also underway at La Coipita, another AbraSilver asset in Argentina's San Juan province. Hole DDH-LC25-006 at La Coipita intersected 621 meters grading 0.38% copper, 0.07 g/t gold, and 62 ppm molybdenum, with further results pending.

AbraSilver continues to report industry-leading discovery costs, averaging just US$0.11 per silver-equivalent ounce since 2020. Management remains focused on advancing Diablillos through low-cost growth, strong strategic ownership, and disciplined capital allocation.

Ownership and Share Structure

AbraSilver's major shareholders, reported Stanley, are insiders (management and board members) with 3%, Central Puerto SA with 9.9% and Kinross Gold Corp. (K:TSX; KGC:NYSE) with 4%. (In AbraSilver's recent CA$58.5M financing, Central Puerto invested CA$25M and Kinross invested CA$3M.)

AbraSilver has 152.7 million shares outstanding. Its market cap is CA$585M. Its 52-week range is CA$1.33–3.85 per share.