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Blackrock Silver’s Amended Tonopah West Report: A Robust Investment in Nevada’s Silver-Gold Belt

Harrison BrooksFriday, May 2, 2025 6:32 pm ET

14min read

Blackrock Silver Corp. (TSXV: BRC, OTCQX: BKRRF) has released an amended technical report for its Tonopah West silver-gold project, addressing regulatory requirements while reaffirming the project’s economic potential. This update underscores the asset’s viability as a high-margin, low-cost development opportunity in Nevada’s historic silver district. Below is an in-depth analysis of the report’s implications for investors.

Regulatory Compliance and Core Data Integrity

The amended report, effective September 4, 2024, and dated April 24, 2025, was revised to comply with National Instrument 43-101 (NI 43-101) guidelines after review by the British Columbia Securities Commission (BCSC). Key changes include:
- Enhanced cautionary language emphasizing the preliminary nature of inferred mineral resources.
- A new Section 19 on market studies and contracts, and expanded Section 21 detailing capital costs.
- No changes to core data: The mineral resource estimate (6.35 million tonnes grading 492.5 g/t AgEq for 100.56 million AgEq ounces) and PEA results remain unchanged.

This stability is critical for investors, as it confirms the project’s foundational economics are intact. The report is available on SEDAR+ and Blackrock’s website, enhancing transparency.

Preliminary Economic Assessment (PEA): Strong Fundamentals

The PEA, based on inferred resources, outlines a compelling economic profile:
- Base-case metrics ($1,900/oz gold, $23/oz silver):
- NPV5%: $326 million (after-tax).
- IRR: 39.2% (after-tax).
- Payback period: 2.3 years.
- Annual production: 8.6 million AgEq ounces over an 8-year mine life.
- All-in sustaining costs (AISC): $11.96/AgEq ounce.
- Sensitivity to higher prices ($2,280/oz gold, $27.60/oz silver):
- NPV5%: $495 million (54% IRR).

The project’s 570 g/t AgEq head grade ranks it among the highest-grade silver projects globally, with recoveries of 96.1% for gold and 88.9% for silver via straightforward milling.

Exploration Success and Resource Expansion

Recent drilling has extended mineralization 1.2km eastward, intersecting high-grade zones like the Ohio vein (e.g., 2,063 g/t AgEq over 1.52m). These results, pending assays from core holes TXC25-133 to -135, could boost the Q3 2025 resource update, potentially incorporating the NW Step-Out deposit (12 million AgEq ounces excluded from current PEA).

Blackrock’s 20,000-meter drilling program (with 14,000m planned for H1 2025) aims to:
- Link deposits across a 1km corridor.
- Convert inferred resources to indicated categories.
- Finalize a revised PEA by Q1 2026, which may incorporate expanded resources.

Operational and Permitting Advantages

Location: Nevada’s Walker Lane trend, on patented claims (private land), simplifies permitting compared to unpatented or foreign jurisdictions.
Environmental progress: Studies for an exploration decline and bulk sampling are underway, advancing the project toward production.
Cost efficiency: Base-case initial capital expenditure of $178 million (including contingency) positions the project as a low-cost development candidate.

Key Risks and Considerations

Metal price volatility: The PEA’s metrics are highly sensitive to gold/silver prices.
Resource conversion: Inferred resources require further drilling to reach feasibility-grade categories.
Regulatory delays: Though Nevada’s permitting is streamlined, unforeseen hurdles could arise.

Investor Catalysts and Outlook

Q3 2025 resource update: Likely incorporates the 1.2km eastern extension, potentially boosting AgEq ounces.
Q1 2026 PEA update: Could reflect higher NPV with expanded resources.
Strategic positioning: Blackrock’s 100% ownership and Nevada’s mining-friendly environment reduce geopolitical risks.

Conclusion

Blackrock Silver’s Tonopah West project emerges as a high-potential asset with robust economics, exploration upside, and a clear development path. The unchanged PEA metrics and recent drilling success de-risk the project’s scale, while its Nevada location and low AISC enhance its appeal.

Investors should monitor the Q3 2025 resource update and Q1 2026 PEA, as these milestones could catalyze valuation growth. At current base-case prices, the project’s 39.2% IRR and $326M NPV5% make it a compelling play on Nevada’s silver-gold belt. While metal prices and drilling results pose risks, the combination of strong fundamentals and expansion potential positions Tonopah West as a standout opportunity in the sector.

Final Metrics:
- PEA NPV5% (base case): $326 million | IRR: 39.2%
- Drilling pipeline: 20,000 meters completed, 14,000m planned for H1 2025
- Resource upside: 12 million AgEq ounces excluded from current PEA

With its high-grade profile and advanced-stage development, Tonopah West is poised to deliver outsized returns for investors willing to navigate the sector’s risks.

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