Regency Silver RSMX TSX
Our Final Stock Pick of 2023 is Regency Silver. As the markets are slow in Junior mining and many stocks will see stop loss selling I see the 4th quarter I will not be recommending anything the rest of the year.
However, there are still opportunities in this depressed market. As I believe interest rates will top out in the short term, gold and juniors will make a comeback in 2024. Gold is showing signs of strength so now is the time to start to look at your favourite junior companies.
At the present I am looking for juniors that have a resource and are building on that resource or are near production and of course a management team that has had a track record of developing mines or selling them.
I think I have found such a company in Regency Silver RSMX TSX.
Firstly, the company’s CEO Bruce Bragagnolo has a great track record of building mines in Mexico.
CEO Track Record
Bruce took Timmins Gold from an IPO market cap of C$7 million to a market cap of US$475 million in 2012. He built the San Francisco mine in Sonora, Mexico. Production peaked at 121,573 ounces of gold in 2014. He raised over $75 million in equity and $18 million in debt for Timmins Gold. Bruce also took Silvermex Resources through its IPO in 2006 and the purchase of its initial assets in Mexico. Mr. Bragagnolo took the market cap of Silvermex from an IPO market cap of C$7 million to its sale to First Majestic for C$175 million. Finally, Bruce was a director of Continuum Resources Ltd. when it acquired the San Jose Mine in Oaxaca, Mexico. Continuum Resources Ltd. merged with Fortuna Silver in 2004 and the San Jose Mine is now its flagship asset with 2022 production of 5.76 million ounces of silver and 34,000 ounces of gold.
Dias Padre Project
Regency’s main project is the past producing Dias Padre project. The project is located in the State of Sonora, Mexico about mid-way between Hermosillo, Sonora, and Chihuahua City, Chihuahua.
Regency Silver has received a NI 43-101 resource estimate with an effective date of
March 2, 2023 which estimates an inferred resource of 11.375 million ounces of silver equivalent represented by 1.384 million tonnes at 255.64 g/t silver equivalent.
A total of 11,481 metres of drilling in 74 drill holes comprise the data set for modelling and mineral estimate.
Recent Results Outside of the resource area, Hole REG 22-01 intersected 35.8 metres of 6.84 g/t gold, 0.88% copper and 21.82 g/t silver. Hole REG-23-14 intersected 29.4m of 6.32 g/t Au and REG-23-15, intersected 32.5m of 2.23 g/t Ag .
In its release today, November 2nd 2023 the company announced another strong hole.
Hole REG-23-21 intersected 54.65m of 5.34 g/t gold including 7.36 g/t over 38m in a ~65m step-out along strike to the southeast from the discovery hole REG-22-01 which returned ( 35.8m of 6.84 g/t gold , 0.88% copper and 21.82 g/t silver ) and ~75m step-out from REG-23-14 ( 35.9m of 5.51 g/t Au including 29.4m of 6.32 g/t Au ).
Michael Tucker the head geologist stated the following:
“The continued ability of the lower breccia zone to produce highly elevated gold grades over significant widths is very compelling. The system has proven the ability to generate spectacular grades and thicknesses.”
Here are three points of the results
● The mineralized breccia zone now has a confirmed strike extent of at least 180m and depth extent of at least 150m, and the breccia remains open both along strike and at depth.
● The shape and orientation of the breccia zone is now understood; trending NW-SE and dipping ~60˚ to the NE. The orientation of the breccia is unrelated to the orientation of the Quartz-feldspar porphyry (QFP). The copper is associated with the QFP.
● High grade gold mineralization is hosted within the larger pyrite-specularite breccia body. More gold-rich zones appear to be associated with areas of increased pyrite.
The project is near Pan American SIlvers’ Dolores project which was opened in 2009 and produced nearly 2.2 million ounces of silver in 2022. It is also near Alamos gold’s Mulatos project which produced 135k ounces of gold in 2022.
Earlier in the year the company reported strong results and will continue to drill into 2024. In addition, the company recently was oversubscribed on a $1.5 million financing raising near $1.75 million, which I can tell you is no small feat in this market.
Stock Chart Shows Signs of Basing and Breaking Out
In addition, I really like the chart which has been showing signs of basing in the 20 to 25 cent range. Bruce brought the company public in 2022 when the mining sector was awful and has been able to raise money in a terrible market. I think the recent strong results along with the fact that PMs look like they are about to breakout and are entering their seasonal strong period means that Regency Silver can really move in the coming months.
Disclosure – Regency Silver is a sponsor of Stockchartoftheday, David and his family own the stock and he has a paid marketing agreement with Regency.