Silver Mines’ US Expansion Raises Questions on Capital and Permitting Risks
Silver Mines Limited has secured two historic Californian projects, Calico North and Kramer Hills, adding significant silver and gold exploration potential to its portfolio with minimal upfront cash outlay.
- Binding agreements to acquire Calico North and Kramer Hills projects
- Calico North hosts extensive historic silver mineralisation with modern exploration potential
- Kramer Hills features a significant oxide gold Exploration Target with deeper sulphide upside
- Minimal upfront cash payments supplemented by Silver Mines shares
- Exploration activities including geophysics and drilling planned for 2025-2026
Strategic Expansion into California
Silver Mines Limited (ASX, SVL) has taken a decisive step to broaden its exploration horizons by entering binding agreements to acquire two significant projects in California’s prolific San Bernardino County, the Calico North Project and the Kramer Hills Project. These acquisitions mark Silver Mines’ first major foray into the United States, complementing its flagship Bowdens Silver Project in Australia.
The Calico North Project, situated within one of the largest historic silver camps in the US, boasts over 40 kilometres of prospective strike with mineralisation that remains largely untested by modern exploration techniques. Historical production in the district exceeds 20 million ounces of silver, and recent rock chip samples have returned high-grade silver assays, underscoring the project's potential.
Kramer Hills, Gold Potential with Historical Roots
The Kramer Hills Project, centered on the historic Shaherald oxide gold mine, offers an initial Exploration Target ranging from 5.1 to 8.5 million tonnes at grades between 1.0 and 1.6 grams per tonne gold. While the oxide zone was mined in the late 1980s, the project holds promise for deeper sulphide mineralisation, supported by historical drilling and a water bore sample indicating mineralisation at depth.
Silver Mines plans to commence exploration activities in the second half of 2025, focusing initially on geophysical surveys and detailed mapping to refine drill targets. Drilling is expected to begin in 2026, aiming to unlock the value of these historically significant but underexplored assets.
Transaction Structure and Strategic Rationale
The acquisitions have been structured to minimize upfront cash expenditure, with total initial payments of approximately US$1.1 million combined with the issuance of Silver Mines shares. This approach preserves the company’s balance sheet while providing shareholders with exposure to potential upside from these new assets.
Managing Director Jo Battershill emphasized the strategic fit of the acquisitions, highlighting the geographical diversification and exploration optionality they bring. He noted that while Bowdens remains the company’s core focus, these projects offer a foothold in a highly prospective region with substantial exploration upside and potential for brownfields development.
Looking Ahead
Silver Mines’ entry into the Californian mining landscape reflects a broader trend of Australian explorers seeking growth opportunities in established North American jurisdictions. The company’s methodical approach to exploration and development, combined with its strong technical team, positions it well to advance these projects through systematic evaluation and resource definition.
While historical data and drilling methods for both projects are limited and not fully compliant with modern reporting standards, Silver Mines’ planned exploration programs aim to validate and expand upon these foundations. Success in these ventures could significantly enhance the company’s resource base and shareholder value over the coming years.
Bottom Line?
Silver Mines’ Californian acquisitions set the stage for a new chapter of exploration optionality and growth beyond Australia.
Questions in the middle?
- How will Silver Mines prioritize exploration spending between Bowdens and the new US projects?
- What are the key permitting and regulatory hurdles anticipated for Calico North and Kramer Hills?
- How might the issuance of shares for these acquisitions impact Silver Mines’ capital structure and shareholder dilution?
