Integra Resources releases more Sullivan Gulch drill results, including record silver interval

Integra Resources (ITR.V, ITRG) has released the assay results from an additional two holes drilled at the Sullivan Gulch zone on the DeLamar deposit, part of the greater DeLamar gold and silver project.

The company used the results from hole IDE-22-228 as its headline result and rightly so as this hole contained 4.1 g/t gold and almost 447 g/t silver (9.85 g/t gold-equivalent) over an interval of 26.97 meters and this relatively thick intersection was boosted by the 0.4 meters containing 80.4 g/t gold and 14,054 g/t silver. But even if you’d completely exclude this 0.4 meters interval from the 26.97 meter wider interval, the remaining 26.5 meters of the reported interval would still carry a grade of in excess of 6 g/t gold-equivalent so smearing doesn’t appear to be a major factor here.

It’s too bad this silver-rich zone can’t be added to the heap leach development plans as the recovery rate of the silver in a heap leach development scenario is abysmal. However, this will add tonnes and ounces to the mill scenario. As you may remember, the main issue with the mill scenario is that the construction of a US$132M mill and related infrastructure (including almost US$60M to be spent on tailing facilities) was too capital intensive as the pre-feasibility plan expected just 400,000 ounces of gold (and just over 33 million ounces of silver) to be recovered from the sulphide phase. This meant the additional contribution from the sulphide zones to the NPV of DeLamar was rather low as the initial capex is a hurdle.

But that initial capex would be a sunk cost, and every additional 100,000 ounces of gold that could be added to the mine plan would immediately reduce the capital intensity of that phase of the DeLamar development and immediately add value to the project.

That’s why although the immediate focus will be on the heap leach phase of the project (and the related permitting), the milling scenario is not written off. It’s just a matter of adding more recoverable gold and silver ounces to the mine plan. These recent exploration results help to generate those ounces and as the IP chargeability at Sullivan Gulch extends for almost an entire kilometer further to the south, beyond any existing drilling completed by Integra there’s plenty of potential to discover even more sulphide-hosted ounces.

Disclosure: The author has a long position in Integra Resources. Integra is a sponsor of the website. Please read our disclaimer.

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