Research Capital Corp. Analyst Stuart McDougall wrote in an updated research note on October 30 that he was increasing the firm's target price for Blackrock Silver Corp. (BRC:TSX.V; BKRRF:OTCQX) to CA$1.30/share, up from CA$0.80/share, to reflect the company's continued exploration success at its fully owned Tonopah West project in Nevada.
On October 27, the company reported results from five of 22 core holes at the Eastern Expansion target. Two of these holes intersected high grades just east of the key DPB South Resource area, near an exploration decline planned for 2027. Another hole yielded even higher grades from the historic Ohio mine area, near the project's eastern boundary, the analyst noted.
These findings support earlier scout holes that indicated a 1.2-kilometer mineralized extension from the DPB South resource area, similar to one extending to the NW Stepout zone, located 1km to the northwest, he said.
"Our valuation still assumes a 25% increase to the September 2025 resource but now values those ounces at US$5/oz Ag (silver) and US$125/oz Au (gold) instead of US$3/oz Ag and US$75/oz Au, converted at 1.4-to-1 and adjusted for options, warrants, and our future equity financing assumptions, McDougall wrote. "We consider the more aggressive in sit metrics reasonable given their general agreement with our DCF10% analysis of the 2024 PEA and subsequent 2025 updated resource estimate at metal prices of US$35/oz Ag and US$3,000/oz Au."
Key assumptions include 100% project debt financing at a 10% annual interest rate, capitalized before production and repaid over five years; 30% higher capital and life-of-mine (LOM) unit costs; 70% of the resource at the average reported grades, excluding the NW Stepout zone; and static metal recoveries of 89% silver and 95% gold, the analyst said.
Construction is expected to start in 2029, followed by targeted full run rates of 1,500 tonnes per day (tpd) in Q1/31, for annual production of nearly 12 million ounces silver equivalent (Moz AgEq) at an average total cash cost of US$9.25/SEO, he said.
DPB South Extension Confirmed; Technical Surveys Underway
In September 2024, Blackrock announced a positive Preliminary Economic Assessment (PEA) projecting the project to produce an average of ~4Moz Ag and ~54,000oz Au per year from 4.1 million tonnes (Mt) grading 271 g/t Ag and 3.34 g/t Au, McDougall said. Total cash costs were projected at US$9.30/SEO over the mine's life, or US$12/SEO on an all-in-sustaining basis.
An average of 1,500 tpd would be mined using sub-level stoping and cut-and-fill mining methods with cemented and hydraulic backfill, the analyst noted. The initial capex of US$178 million was recovered in just over two years at base-case metal prices of US$1,900/oz Au and US$23/oz Ag. An updated resource (MRE) has since been completed to include an additional 83 infill and delineation holes, and management has begun necessary studies for the underground program.
Eastern Expansion
Initially, Blackrock focused on an area between the DPB South and NW Stepout resource blocks, bridging the first half of that 1km-long gap on 50- to 75-meter centers, McDougall wrote. The rig then moved to the Eastern Expansion area, with the first seven RC holes suggesting a 1.2-kilometer extension from the resource area's eastern limits.
Another 22 core holes have since been drilled, with two just east of the resource shell returning 0.82 meters grading 568 g/t Ag and 5.95 g/t Au within an 8.75-meter section that ran 90 g/t Ag and 0.94 g/t Au, and 1.1 meters grading 9.2 g/t Ag and 8.67 g/t Au within a 5.67-meter section that ran 3.6 g/t Ag and 2.38 g/t Au, the report said. Both are relatively shallow, at 234 meters and 180 meters downhole, and each is enriched in gold relative to the DPB South grade.
Ohio Mine Area
One of the two holes from the Ohio mine area returned 5.03 meters grading 307 g/t Ag and 4.06 g/t Au, starting at 165 meters and including 1.83 meters at 724 g/t Ag and 8.58 g/t Au, McDougall said.
These results complement the discovery hole, TW25-128, which intersected two 1.52-meter sections grading 1,198 g/t Ag and 9.61 g/t Au at 293 meters, and 219 g/t Ag and 1.71 g/t Au at 297 meters. An even older hole, TW20-001, cut similarly rich but broader mineralization some 1.1 kilometers further along the fault, with nearly 29 meters grading 436 g/t Ag and 5.29 g/t Au.
True widths are estimated at 75-85% of the drill widths, and results are still pending for 13
holes, including 11 from Eastern Expansion area and two from DPB South resource area, McDougall wrote.
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Disclosures for Research Capital Corp., Blackrock Silver Corp., October 30, 2025:
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I, Stuart McDougall, certify the views expressed in this report were formed by my review of relevant company data and industry investigation, and accurately reflect my opinion about the investment merits of the securities mentioned in the report. I also certify that my compensation is not related to specific recommendations or views expressed in this report. Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report.
Stuart McDougall has visited Blackrock Silver Corp. in the past 18 months.
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