Polymetals Resources has begun mining high-grade silver ore at its Endeavor mine, revealing silver grades significantly above expectations and initiating a direct shipping ore trial to capitalise on newfound value.
- Mining commenced on high-grade Upper North Lode (UNL) silver ore
- Silver grades materially exceed previous models due to native silver presence
- Direct shipping ore (DSO) trial underway to maximise payable metal value
- Approximately 11,000 tonnes mined with 18 months of UNL ore reserves remaining
- Higher silver grades and prices underpin expected revenue growth
Mining Breakthrough at Endeavor
Polymetals Resources Ltd (ASX:POL) has announced a significant operational update from its Endeavor silver mine near Cobar, New South Wales. The company has commenced mining the Upper North Lode (UNL), a high-grade silver ore body, and early results indicate silver grades materially higher than previously modelled. This discovery is largely attributed to the confirmed presence of native silver within the ore, a factor that had historically been difficult to quantify.
With approximately 11,000 tonnes of UNL ore already extracted, Polymetals is on track to mine the remaining ore reserves over the next 18 months. The higher-than-expected silver grades are a welcome surprise, suggesting that the mine’s revenue potential could be significantly enhanced beyond initial forecasts.
Capitalising on Native Silver
Native silver, visible in ore samples and confirmed through mineralogical analysis, is a valuable find. It not only boosts the silver grade but also contains payable gold value that conventional concentrate processing might not fully recover. Recognising this, Polymetals is trialling direct shipping ore (DSO) to smelters, a strategy designed to capture the full economic benefit of the ore’s unique composition.
The company has prepared an initial DSO parcel of about 30,000 tonnes, which is currently being crushed and stockpiled ahead of shipment. This approach could streamline revenue generation by bypassing some processing steps and realising higher payable metal returns, particularly for gold and native silver.
Strategic and Financial Implications
Executive Chairman Dave Sproule highlighted the historical context of native silver in the Endeavor orebody, noting its presence in supergene mineralisation mined decades ago. The current positive reconciliation between modelled and actual grades confirms that the upper levels of the deposit hold more value than previously understood.
Polymetals is actively working to convert more mineral resources into ore reserves, buoyed by the recent silver price increases. This conversion could further extend the mine’s life and enhance its profitability. Meanwhile, scheduled shipments of zinc concentrate and the upcoming DSO shipment are expected to maintain robust cash flow, supporting the company’s growth ambitions.
The market will be watching closely for the results of the DSO trial and the forthcoming March quarterly report, which will provide further insight into the financial impact of these operational developments.
Bottom Line?
Polymetals’ discovery of higher silver grades and native silver at Endeavor sets the stage for stronger revenues and operational flexibility, with the direct shipping trial a key test of this new potential.
Questions in the middle?
- How will the direct shipping ore trial impact overall profitability compared to traditional concentrate processing?
- What is the potential scale of resource-to-reserve conversions given the higher silver prices and grade reconciliations?
- Could the presence of native silver lead to further exploration or expansion opportunities within the Endeavor mine?