By Francois Kalos
We are starting to see what could be the beginning of a silver bull market. The time is ripe for companies like New Pacific Metals (NYSE-A:NEWP; TSX:NUAG) to capitalize on rising silver prices as it continues to advance and de-risk its Silver Sand and Carangas projects in Bolivia.
New Pacific Metals has all the necessary elements to join the ranks of high performers, with its world-class silver projects, a seasoned management team, solid relationships with strategic investors, a strong financial position, and other key factors outlined below.
Silver Sand Project
Ranked among the top undeveloped silver projects in the world, Silver Sand is a large, low-cost, open-pit, pure silver project. It has a near-surface measured and indicated mineral resource estimate (MRE) of 54.3 million tonnes with a grade of 116 g/t silver containing 201.8 million ounces of silver and an inferred resource of 4.6 million tonnes with a grade of 88 g/t silver. Silver Sand’s January 2023 Preliminary Economic Assessment (PEA) projects an average annual silver production of 12 million ounces over a 14-year mine life at an all-in sustaining cost (AISC) of US$10/oz, which is low compared to the AISC of comparable silver development projects in Latin America. The projected 39% internal rate of return (IRR) for Silver Sand makes it a very profitable project.
These strong numbers have led New Pacific Metals to move to the next step: a Pre-Feasibility Study (PFS), the results of which are expected in June of this year. In recent developments, the company announced the results of its PFS metallurgical test program which demonstrated the exceptional metallurgical properties of Silver Sand with recoveries ranging from 89.6% to 92.7% and the potential to increase recoveries to 93.9% under certain conditions, compared to the 91% reported in the PEA. These results were achieved with reduced cyanide consumption, highlighting the potential for reduced operating costs in the forthcoming PFS. The company is also working on completing an Environmental Impact Study to advance the permitting process.
Carangas Project
New Pacific Metals’ other large project is Carangas, a large silver-gold polymetallic discovery, that includes lead, zinc, and gold. In August 2023, New Pacific Metals reported the results of the initial MRE on Carangas with a total indicated mineral resource of 560 million ounces silver equivalent and a total inferred mineral resource of 110 million ounces silver equivalent. These results were achieved in less than two years through 81,145 metres of drilling in 189 holes, with the project still showing strong exploration potential.
Given these results, a PEA has been initiated at Carangas and results are expected in the third quarter of this year. The PEA will focus on the Upper Silver Zone, which contains higher-grade silver values. New Pacific Metals is confident that the PEA will showcase a second strong silver development project within its portfolio.
Peer investment is the best recognition a company can get, especially from a major like Pan American Silver (TSX/NDAQ:PAAS), which has been in Bolivia for two decades. Pan American Silver has increased its stake to 12% by investing in New Pacific Metals’ most recent financing round at C$2.65. New Pacific Metals’ other shareholders include Silvercorp with 27%, institutional funds with 16%, management, board and insiders with 7%, with retail shareholders holding approximately 38%.
Securely Established in Bolivia
New Pacific Metals recently celebrated its seventh year in Bolivia, a country where it has established solid relationships with local communities, governments, and other local stakeholders. During these past years, the company has invested over US$65 million in exploration and drilling expenditures, supported local employment, and participated in several initiatives to help regional communities near its sites. The company is committed to operating in a sustainable manner, which is expected to support the ongoing production permitting process.
Solid Balance Sheet and Other Asset
New Pacific Metals has a strong financial position with US$23.67 million in working capital as of March 31, 2024, which will be used to advance the Silver Sand and Carangas projects and for operating expenses.
The company also has a third silver project, Silverstrike, which it acquired in 2019 and has been working on until 2022. Although the company has deferred work on Silverstrike to focus on its more advanced projects, the property still holds strong potential given the results of its exploration programs, which have shown similarities to Carangas and Silver Sand, and its location in a known historic silver mining district.
Seasoned Management Team
These accomplishments are the result of New Pacific Metals’ seasoned management and technical team’s strategic and methodical approach towards exploring and developing its world-class assets. New Pacific Metals was born out of the vision of the company’s founder, Dr. Rui Feng, to build a strong silver base in Bolivia (the 5th largest silver producing country in the world).
Dr. Feng’s final element to grow the potential of New Pacific Metals was to hire a new CEO to succeed him and pursue the company’s growth objectives while he continued to focus on Silvercorp. This was achieved with the promotion of Andrew Williams to CEO and Director of New Pacific Metals in September 2023 following his appointment as President in January 2023.Mr. Williamshas quickly proven to New Pacific Metals’ Board that he has the qualities to take the company to the next level and create sustainable long-term value for its shareholders.
New Pacific Metals has all the elements to become a successful, world-class silver producer in Bolivia and with a silver bull market the company could become a top performer. It is rare for a small mining company to have one world-class project, and having two puts New Pacific Metals in a uniquely privileged position among emerging silver mining companies.
For more information on New Pacific Metals, please visit newpacificmetals.com/welcome.
About the author: Francois Kalos has more than 20 years of experience as a writer for small and micro-cap Canadian companies in various sectors including mining, technology, consumer products and biotechnology.
Disclaimer: This article is for informational purposes only. The content of this article is based on company press releases, presentations, interviews, website content, current events, and the author’s opinions. Nothing in this article constitutes or should be construed as investment advice or an offer or solicitation to buy or sell any stock or commodity. Readers should always do their own research and seek the advice of a qualified investment advisor before making any investment decision. The author has received compensation for this article and has no stock, option or similar derivative position in any of the companies mentioned. This is third-party content provided by New Pacific Metals Corp. Please see full disclaimer here.
Join the discussion: Find out what everybody’s saying about this company on the New Pacific Metals Corp. Bullboard investor discussion forum, and check out the rest of Stockhouse’s stock forums and message boards.
