Golden Arrow Resources (GRG.V) recently filed its NI43-compliant resource estimate on the Chinchillas Silver Project in Argentina. We sat down with Sean Hurd and asked him a few questions about the path forward.

– You announced a resource estimate of in excess of 100 million ounces silver-equivalent in May. Was this in line with your expectations or did you beat your back-of-the-envelope calculations?

No, when we first started on this project we expected to find about 30 million ounces. But the drilling proved much more successful than expected as we got better than expected results close to surface and we discovered a deeper zone that we did not expect. We now have the view that we can still grow the deposit substantially and we are working on acquiring additional ground.

– When do you anticipate to start the Phase III drill program?

Most likely in late Q3 or Q4.

– How many meters would you like to drill?

We plan to drill 6,500 meters. The average drill cost per meter is approximately $300, so this drill program will cost us roughly $2M.

– How much of those meters will be focused on infill and how much on expansion of the resource estimate?

The focus will be on expanding the resource so the infill will be limited at this time. There are several exciting new targets that we intend to test with the next phase of drilling.

-As the market currently only cares about hard numbers, when do you expect to have a first PEA ready?

We are working on an internal PEA at the moment since this will help us get a handle on the economics of the project (which look excellent). To produce an external PEA would require infill drilling and our immediate focus is exploration. The modeling we have in our presentation and on the web allows for analysts to get a reasonable idea of the economics at this early stage but we will move to an external PEA in the near future but we don’t have a fixed timeline so far.

– Are you currently talking to potentially interested parties who might want to JV or acquire the project?

Yes, there are several parties that we are speaking to.

Disclosure: The author holds a long position in Golden Arrow Resources. Golden Arrow is a sponsor of the website. Please see our disclaimer for current positions.

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