General Precious Metals
Silver Hammer Mining (CSE: HAMR)(OTC: HAMRF) CEO Morgan Lekstrom on Drilling for Game Changing Parallel Chutes at Silver Strand
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Silver Hammer Mining, Mr. Morgan Lekstrom. Morgan, it's great to have you back on. How are you?
Morgan Lekstrom: I am fantastic! How are you?
Gerardo Del Real: I'm well, I'm well, listen, let's get right into it. The beautiful thing about silver and the precious metals space, is that when there is a bull market, you can make a lot of money really, really quickly if you know what you're doing, and sometimes just by pure accident. With the current pullback in the silver price, the gold price, metals prices in general, a pullback by the way which I think will be temporary, the opposite happens, right? All of a sudden, share prices are down 40, 50%. While that never feels good, I've been around long enough now to know that the better companies that come out on top when that bull market kicks in are the ones that do the quality accretive work during those tough periods. You not only just engaged the drilling contractor in the month of July for the drill program at Silver Strand in Idaho, but you also have an exploration program happening in Nevada. You're positioning well, you've done a great job with that. I wanted to have you back on just to get an update on where everything stands.
Morgan Lekstrom: Yeah, I think you're absolutely right. Silver Hammer is positioned and poised to take advantage of that market in any sense. We have three high potential, low-risk projects. Keeping doing work, while doing the work while these markets are doing what they're doing only allows us to accelerate them when the markets are great, right? So instead of sitting on our hands and twiddling and whining about it, we don't do that here. We buckle down, we raised $3 million recently, and very successfully oversubscribed, and we're going to use that. We're going to utilize it in a very cash-efficient method that gives us the highest impact and biggest return work for the lowest cost. That's not funny jargon to say, "Oh, we're going to do nothing." That is actual, real work happening, drilling happening on our Idaho project, Silver Strand. Work happening in Nevada on our Eliza project that's soil sampling. These are fundamental things that have to happen anyway, so why not do them when the market's down and people are on vacation, right?
Gerardo Del Real: I couldn't agree with you more. Silver Strand is the project that in the near term, obviously to me, is going to be the major catalyst. It's a phase two program. You're looking to test the depth extent of the known mineralized body. I should remind everybody, this is a past producing asset. There's been a lot of work that has gone into this project. So I'm excited to see the testing to depth. Can you tell me more about the approach there and what you're hoping to see?
Morgan Lekstrom: Yeah, absolutely. Not only are we testing to depth this year, but one thing we've started to realize when we're looking at the model and we have people like Ron Burke in the background, and Phil Mulholland and Lawrence Ralston, these are all geology experts. Ron's found silver mines all over the world and we're doing our technical call. Every one of them looked at me and goes, well, hold on, we have something. We think it goes down to depth here, but what about all these paralleling shoots? Let's start looking for paralleling shoots. Because that's really, not only do you get depth, you start getting near surface, paralleling shoots, this thing gets massive fast, right? That's the Lucky Friday model. That's the Galena model. They've started with one little outcrop. They started drilling from their underground, and boom. They were finding drilling shoots everywhere.
So we are running an IP survey right now, induced polarization, sending down the electrical current and checking for resistivity, which has the exact same signature as our existing mineralization. Now we're looking for those paralleling shoots. I think it could get pretty exciting for us this year, especially, fingers crossed and praying to the mining gods, that we smack one of those paralleling shoots. We have a pretty good idea where we think they are. If that happens, this thing goes from a single shoot mine to a potential multi, multi, multi shoot mine, and potential mine in the future. That changes the game for us.
Gerardo Del Real: Is the plan still an 11-hole phase two diamond drill program? Or are you scaling that back? Are you expanding on that? Or are you sticking to that for now and waiting to see the results?
Morgan Lekstrom: Yeah, we are very fortunate and I say this not to avoid the question. We are very fortunate that we have a great drilling contractor and a great relationship with them. And why we are fortunate to have that is we can step and stage this approach. So, instead of just going out and drilling, 20 holes and then assaying and hoping we hit something, we're going to drill it methodically, we're going to drill the 11 or 12 holes. We're going to drill a thousand plus meters. But remember this is from the underground. When I mean from the underground, I mean right at surface we walk into the mountain with a drift and we are in the underground. So it's right at surface. That allows us to not have to do overburden drilling, not have to destroy a bunch of land and build roads and permit and do all this fun stuff that takes years and a ton of capital. We say we're going to drill 11 holes of a thousand plus meters. That's equivalent of driving a multi-thousand-meter program, but we can do it very cost-effectively and very quickly. So yes, we are going to drill. We are planning on drilling 11 holes. We may expand that we may taper it back. We are going to do what is most economic for the project to give us the biggest bang for the buck.
Gerardo Del Real: Sounds like the approach from a team that knows what it's doing. That understands the current sentiment in the resource space that wants to protect that treasury, but also wants to make sure that it's adding value. Tell me about Eliza in Nevada.
Morgan Lekstrom: Eliza was the past producing mine in the 1800s, and multiple past producing mines. That whole area was just insane. In 1868 to 1872, they produced roughly 40 million ounces of silver. You think in four years producing that is a significant whack of silver, out of about one mile wide by or one mile long by half-mile wide area. Now, we picked up a portion of that property that really hasn't been explored. They had some test pits on the top portion of the property. So we said, again, with our technical in the background, we were able to assess it and say our best bang for a buck right now is soil sampling. That's going to give us all the indicating minerals of what ties to the silver mineralization and all that geology work that generally people send these huge teams into.
We can do that again, cost-effectively in a longer period of time, because we're not trying to accelerate that at lightning speed. Now we are soil sampling, we should be finished at soil sampling here this week, I believe. That will compile with the soil sampling finished in the fall. We've been able to look at these pathfinder elements, but also report to people “We think this is big because of X." And the soil sampling, not to quote Ron Burke too much, but Ron's found multiple mines and what he said, a lot of mines were found using soil samples. I know some very good geologists personally, that swear by that soil sampling is one of the main ways to find large mines. We're hoping that program's going to pay off very well. Again, low cost high impact for us.
Gerardo Del Real: Ron Burke, by the way, is a great one to quote for the exact same reason that you outlined, he's found many of these. When will drilling actually commence? You announced earlier in the month at Silver Strand that you had engaged the contractor. When do you anticipate the drill turning?
Morgan Lekstrom: Absolutely. The drill is contracted and mobilizing next week. So we're hoping by the end of next week we’ve got the drill in the underground and looking to have drills turning. August is going to be a very exciting drilling month for us there. It's a thousand-plus meter underground drilling program. That has different timelines and surface, a little longer. August will be a lot of drilling happening, then again, we'll see what we hit. If we start hitting these parallel shoots, drilling might continue, right? It really depends on what we're seeing, which we're very hopeful and very accurately predicting, we hope we're actually predicting where we're going. This month is going to be exciting. September with some results, in October some results. It's going to be a pretty catalyst-driven year for the rest of the year for Silver Hammer.
Gerardo Del Real: Hitting those parallel shoots is a game changer for the company. If that happens, Morgan, I'll be watching. I appreciate you taking the time to come on and provide that update and fingers crossed. I wish you guys all the luck.
Morgan Lekstrom: Thanks a lot. Appreciate it. And thanks again for your listeners.
Gerardo Del Real: All right. We'll chat soon, Morgan. Thank you.
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