Step-Out Drilling Finds High-Grade Silver in Golden Triangle
Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX) says mineralization has been intersected in its drill results from step-out drilling at the Wolf Vein of its British Columbia project. One expert is "holding tight" on the stock.
Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX) announced the first drill results from step-out directional drilling at the Wolf Vein of its 100%-owned Kitsault Valley project in British Columbia's Golden Triangle.
The company said mineralization was intersected in a 40-meter southwest step-out grading 1,091 grams per tonne silver (g/t Ag) over 9.38 meters, with "significant base metal grades." Its stock went up about 10% on the news.
"We are encouraged with an increase in silver plus base metal grades over potential bulk underground mining widths at the Wolf Vein and eagerly anticipate more assays soon from this area," Chief Executive Officer Shawn Khunkhun said. "We are impressed with the consistency of mineralization, including strong native silver, within the intersection from drill hole DV24-404."
Khunkhun said additional drilling to the southwest was being prioritized for the remainder of the drilling season.
About 8,000 meters of an ongoing 25,000-meter drill program at Kitsault Valley is being drilled at the Wolf Vein to expand and infill the plunge of high-grade silver mineralization there.
Dolly Varden said in a release it is using directional drilling to precisely target areas for step-out and infill work. Drillhole DV24-404 is the initial "mother" hole on a step-out collared at surface from which three additional holes were directed off at depths near the base of the sedimentary cap (DV24-409, 412, and 414).
Assays are pending for the three "daughter" holes. Further results from DV24-404 included 2,505 g/t Ag, 3.42% lead (Pb), and 2.88% zinc (Zn) over 1.63 meters.
The directional drilling steered the holes to intersect the Wolf Vein at specific points that were a minimum of 30 meters apart. The drill hole was collared within the Surprise target area to the west of the Wolf Vein and intersected gold mineralization near the top of hole, the company noted.
Drill holes DV24-396 and DV24-402 targeted the upper, northeast portion of the recently discovered Wolf Vein Extension, Dolly Varden said. These holes tested for mineralization below the projected plunge of high-grade silver first discovered in previously released drill hole DV21-273. Both holes intersected alteration and the Wolf structure where elevated base metal values are typical.
CEO: 'A Strong Mineralizing System'
The first results from the drilling campaign were released in June and intersected high-grade silver mineralization at the Moose and Chance veins. Hole DV23-387 at the Moose Vein assayed 977 g/t Ag over 5 meters, including 3,670 g/t Ag over 0.79 meters.
Hole DV24-388 at the Chance vein intersected 206 g/t Ag over 23.03 meters, including 597 g/t Ag over 1.4 meters and 749 g/t Ag over 0.5 meters.
"These excellent results from the first hole at the Moose Vein from the 2024 program (exhibit) similar geological and mineralization features to the Wolf deposit located 1,400 meters south," Khunkhun said at the time. This "suggests that this area has potential to emerge into the northernmost silver deposit along the 5-kilometre-long trend that also hosts the Dolly Varden, Torbit, and North Star deposits."
Jeff Clark, author of The Gold Advisor and Paydirt Prospector, wrote that he is expecting the stock to "kick into high gear once the silver price breaks out decisively."He said the "robust nature of the mineralized structure" at Moose "suggests a strong mineralizing system."
In addition to Moose and Chance, an initial target is also the North Star Deposit step-out. The drilling program is being split about 50/50 between the Dolly Varden and Homestake Ridge properties (which together make up the Kitsault Valley project).
The drilling is also being split into thirds overall between the Homestake Silver deposit area, the Wolf deposit, and project-wide exploration for new discovery targets.
In an updated research note after the Moose and Chance news, Analyst Stuart McDougall of Research Capital Corp. maintained his Speculative Buy rating with a CA$1.45 per share target price.
"Although it's still early days, the grades and widths are similar to those in the known zones located to the south," McDougall wrote. "Accordingly, we continue to value the company on the basis of its successful expansion of existing resources, using our benchmark in situ metrics of US$3/oz Ag and US$75/oz Au (gold), adjusted for options and our future equity financing assumption."
Jeff Clark, author of The Gold Advisor and Paydirt Prospector, wrote that he is expecting the stock to "kick into high gear once the silver price breaks out decisively."
"I am holding tight onto this stock, one I anticipate not only giving us a nice return from current levels but also a premium when it's eventually bought out," Clark wrote.
The Catalyst: An Electricity Revolution
The most conductive element in nature, silver is used to coat electrical contacts in computers, phones, cars, and appliances. It's also an important element in solar technology.
Silver spot prices rose to a new all-time high of US$32.43 per ounce on May 20 and have remained volatile since. The price was US$28.08 on Monday.
According to the Silver Institute's World Silver Survey, global demand for silver "massively exceeded" supply last year, a deficit that is expected to extend into a fourth consecutive year in 2024.
Streetwise Ownership Overview*
Dolly Varden Silver Corp. (DV:TSX.V; DOLLF:OTCQX)
*Share Structureas of 5/17/2024Source: Dolly Varden Silver Corp.Mordor Intelligence noted that the white metal is expected to register a compound annual growth rate (CAGR) of more than 5% between 2024 and 2029.
"An increase in the demand for new technological products is expected to help the market expand in the future," Mordor analysts wrote. According to a U.S. Geological Survey report, "27% of the silver produced in the United States was being utilized in electrical and electronic applications."
Ownership and Share Structure
According to Dolly Varden, 48% of the company is held by institutional investors, including Fidelity Management & Research Company LLC, Sprott Asset Management LP, U.S. Global Investors Inc., Delbrook, and Extract Capital.
About 44% is with strategic investors, including 19% with Fury Gold Mines, 15% with Hecla, and Eric Sprott owns 10% himself.
The rest, 8%, is with retail and high-net-worth investors.
The company has 286.21 million outstanding shares. Its market cap is CA$302.82 million, and its 52-week trading range is CA$0.58-1.29 per share.
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Important Disclosures:
Dolly Varden Silver Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Dolly Varden Silver Corp.Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.For additional disclosures, please click here.