Silver is THE critical ingredient in solar panels. And with demand for this renewable energy predicted to soar while supply falls, analysts are predicting a price spike which could dwarf the lithium boom.
It’s hard to imagine a stronger tailwind for ASX newcomer Sun Silver. With a resource of ~300Moz of silver equivalent already under its belt in the highly desirable mining state of Nevada and a market cap of just $72 million, Sun Silver is rapidly building a big following as investors scramble for an exposure to the next hot metal.
With silver surging to 10-year highs, meet the ASX’s newest silver company…
Highlights:
- Sun Silver (SS1) listed on the ASX last week following a heavily oversubscribed $13 million IPO at $0.20 per share, having set new records on the ASX for the fastest progression from Prospectus lodgement to ASX listing.
- The Company’s key asset is the Maverick Springs Silver-Gold Project in Nevada, USA, which hosts a JORC compliant Mineral Resource of 292 million ounces AgEq (silver equivalent) at 72.4g/t AgEq (125.4Mt at 43.5g/t Ag, 0.34g/t Au for 175.7Moz silver and 1.37Moz gold).
- The Project is located in the geologically prospective Carlin Trend in the heart of Nevada, a Tier-1 mining jurisdiction which was ranked as the Number One mining jurisdiction globally by the Fraser Institute in 2022.
- Maverick Springs offers an exceptional platform for growth, with approximately 200 holes drilled historically for ~60,000m of drilling, covering just 20 per cent of the Property. The deposit remains open along strike and at depth.
- Sun Silver offers exceptional exposure to the silver market, which is set for transformational growth over the coming decade due to soaring demand from industrial applications, particularly solar panels.
- Silver demand from solar panels has soared by 330% since 2014, growing from 48Moz in 2014 to 160Moz in 2023. The silver market has been in deficit for the past three years, with this deficit forecast to grow as the global energy transition gathers momentum.
- Global investment banks have been upgrading their silver price forecasts on the back of a stream of positive news for the silver market, with Bank of America predicting that prices could move above US$35/oz and TD Securities tipping that the price could hit US$50/oz.
- Sun Silver was recently named the #1 micro-cap pick for 2024 by both Luke Laretive of Seneca Financial Solutions and Next Investors. Next Investors’ most renowned Small Cap Pick of the Year was Vulcan Energy back in 2020, which was up over 8,000% at its peak.
- The Company has just announced that it has commenced the drill contract tendering process for its maiden drilling program at Maverick Springs, where it is fully permitted to start drilling immediately.
Silver…the new lithium?
In a recent article on Livewire Markets, Luke Laretive – CEO & Portfolio Manager for Seneca Financial Solutions – said silver is the “forgotten energy transition metal” thanks to its use in solar panels.
Laretive said silver’s demand shift from precious metal uses (think silverware and jewellery) towards industrial applications will hit a major inflection point in 2024, with industrial demand set to outstrip all other uses for the first time.
He said solar panels are now the single largest industrial usage of silver, with other industrial applications such as EV chargers, nuclear reactor rods and electrical componentry – all of which result from silver’s high electrical conductivity – expected to also contribute to demand.
However, despite its strong outlook, Laretive said mined supply of silver has been stagnant for the past 10 years (with 2013 production of 845Moz versus 820Moz in 2023), with limited new supply coming on-stream.
Read the full Livewire article here.
The silver price recently passed US$30/ounce for the first time in a decade and, according to a recent note by commodity analysts at TD Securities, has room to move a lot higher.
TD Securities analyst Daniel Ghali said in the note that the last time silver prices broke through US$30/oz, the metal traded up to US$50/oz in less than 10 weeks.
Read about the TD Securities report on Kitco News
Meanwhile, in a recent note (April 2024), Bank of America names silver as one of its preferred commodities, driven by what it describes as a “confluence of macro factors”.
BoA predicts that silver production will decline by 9.4% in 2026, compared to 2023 levels, resulting in a supply deficit of around 260Moz, which means 2026 would be the fifth consecutive year of structural deficit.
BoA forecasts a silver price in 2026 of US$35/oz.
Read the BoA “Metals Strategist” Report from page 37:
Expert insight: The Great Silver Bull
Listen to this podcast with one of the world’s top silver experts…
Peter Krauth is a highly regarded silver analyst and author of the book The Great Silver Bull. In this The Hole Truth Podcast he outlines why he believes we’re on the cusp of a huge explosion in the silver price thanks to falling supply and rising demand largely off the back of solar panel consumption. Peter is an absolute expert in his field, and he outlines in detail why thinks we’re on the edge of a new bull run in silver.
Sun Silver – the newest silver company on the ASX
Sun Silver is one of the ASX’s very few pure-play silver companies, completing a heavily oversubscribed $13 million IPO and commencing trading on the ASX on 15 May.
The Company is underpinned by the Maverick Springs Silver Project, located 85km from the full serviced mining town of Elko in Nevada, close to several world-class mining operations including Barrick’s Carlin Mine.
The Project hosts a JORC Inferred Mineral Resource of 125.4Mt grading 43.5g/t Ag and 0.34g/t Au for 175.7Moz of contained silver and 1.37Moz of contained gold (292Moz of contained silver equivalent).
Around 200 holes for 60,000 metres of drilling has been completed at the deposit to date. The deposit itself remains open along strike and at depth, with multiple mineralised intercepts located outside of the current resource constrained model.
Sun Silver is aiming to develop Maverick Springs and undertake early-stage studies to assess the feasibility of silver paste and solar energy opportunities.
Meet Sun Silver’s Executive Director and hear him in conversation with Paul Armstrong from Read Corporate in this in-depth podcast.
Plus:
- Read about Sun Silver’s ASX listing here.
- Download the latest corporate presentation here.
- View the IPO Prospectus here.
- See an interview with Sun Silver Executive Director, Gerard O’Donovan
Sun Silver – top pick for silver exposure on the ASX
Looking to ASX exposure, Luke Laretive said Sun Silver (ASX: SS1) is Seneca Financial Solutions’ top ASX pick to capitalise on the silver thematic, offering a project in a Tier 1 jurisdiction, a proven management team, globally significant Resource potential and attractive early-stage pricing. Read more here.
Plus, Next Investors nominated Sun Silver as its “Small Cap Pick of the Year” – a label it reserves for companies that it thinks have the highest potential to deliver outsized returns. Read more here.
Sun Silver – fully permitted and ready to drill
With an active Plan of Operations in place, Sun Silver recently announced that it is fully permitted to immediately commence drilling at Maverick Springs.
The Company has recently released its maiden drilling campaign tender to market, with a priority focus on local drillers with demonstrated operational success within the targeted Carlin Trend.
Initial drilling will focus on the high-grade northern section of the project, with an initial focus on upgrading the Resource classification and testing extensional opportunities.
