Following up on its June 7 press release, Dolly Varden Silver Corp. (TSXV: DV) (OTC: DOLLF) announced this week it has commenced drilling at its namesake silver project located near tidewater in northwest British Columbia.
This initial surface diamond drill program will consist of 10,000 metres, split 50/50 between infill and expansion of the high-grade, potentially bulk-mineable silver resource at the Torbrit deposit and regional exploration of multiple, highly prospective targets throughout the property.
The 2021 drilling program is the first phase of an aggressive two-year campaign at Dolly Varden to aggressively expand and upgrade the Torbrit Silver deposit and multiple silver-rich satellite zones. The ultimate goal is to advance Dolly Varden to be the next high-grade pure silver mine in the province.
Drilling at Torbrit will be targeting areas within the updated block model where a high percentage of inferred resources exist and where the higher silver grade blocks are at the outer edges of the model (see figure below).
According to the company, it is these areas that have the potential to expand the model out along the Torbrit horizon. In addition, infill drilling from 2020 indicates that a number of lenses that have been modelled out as separate zones coalesce in places into one continuous mineralized body, creating an opportunity for expansion.
In a press release dated July 6, Dolly Varden CEO Shawn Khunkhun stated: “We are excited to start the 2021 drill program at Torbrit silver deposit, where the recent geological modeling and interpretation suggests multiple areas to expand and upgrade the mineral resource. This drilling should lead to a much better understanding of the deposit, new resource expansion areas and give us additional confidence to apply preliminary bulk underground mining designs and more advanced economic studies.”
“Additionally, we will be testing some new very exciting exploration targets that were developed subsequent to the 2020 exploration program,” Khunkhun added.
About Dolly Varden Property
The Dolly Varden project comprises 88 square kilometres in the Stewart Complex of northwestern BC, which is known to host base and precious metals deposits.
The property hosts four historically active silver mines — Dolly Varden, Torbrit, North Star and Wolf — all of which have parts that remain unexplored.
Mining activity at the Dolly Varden property can be dated back to 1910, when the original Dolly Varden mine was discovered by Scandinavian prospectors.
In its early days, it was among the richest silver mines in the British Empire. The other deposit in the area to see production later was Torbrit, which at one time was the third-largest silver producer in Canada.
Historical records show these two deposits together have produced more than 20 million ounces of high-grade silver between 1919-1959, with assays of ore as high as 2,200 oz (over 72 kg) per tonne.
Production subsequently ceased due to low silver prices, and the assembled property was eventually acquired by Dolly Varden with a view of re-awakening the historic silver mine.
According to DV, much of the property remains unexplored to this day — to be exact, only 3% of the area has been explored in detail.
“Despite the long production history and exploration history we’re still making new discoveries,” Dolly Varden’s head geologist Rob van Egmond claimed in a recent AOTH video interview.
An updated NI 43-101 resource estimate completed in 2019 revealed 32.9 million ounces of silver in indicated resources and 11.477 million ounces in inferred, adjacent to the historical deposits.
What makes the project truly unique is that it is a volcanogenic massive sulfide (VMS) and epithermal-style pure silver deposit in nature.
This is very rare in the silver exploration space, as most of the metal is mined from lead-zinc deposits or as a byproduct of gold mining.
Silver District Emerging
The current drill program focuses on the high-grade Torbrit deposit, which is potentially amenable to low-cost underground bulk mining methods.
Modern mining and processing occurred on the property in the 1950s and 60s, in addition to direct-shipping silver mines throughout the property during the first half of the 20th century.
From 1949 to 1959, the Torbrit mine produced nearly 19 million ounces of silver at an average recovered grade of 13.58 oz per tonne from the Torbrit mine. As mentioned, it was one of Canada’s largest silver mines during that period.
Torbrit is currently the largest portion of the four deposits that make up the Dolly Varden mineral resource and, according to DV, is the largest pure-play silver project in all of Canada.
However, this silver resource is about to get even bigger with the commencement of drilling on the Dolly Varden property.
The aim of the 2021 drill program is to try and extend Torbrit through some step-out drill holes, and to get into the high-grade 500 g to 1 kg material. Based on recent work by the DV team, there are early indications of other Torbrit “look-alikes” along a 4.5 km trend.
Through drilling, not only does Dolly Varden want to find the next Torbrit, it also aims to drastically increase the size of the resource, which in all categories is about 44 million ounces at an average grade of 300 g/t Ag.
After integrating the 2019-2020 drilling results, the company now has an increased understanding and confidence in the existing resource to target specific areas of the deposit for conversion from inferred to indicated/measured resource categories.
Similar Model to Eskay Creek
Dolly Varden is also encouraged by the fact that the rocks hosting the mineralization on its property are the same age as some of the most famous deposits found in BC’s Golden Triangle, in particular Eskay Creek.
The geology underlying the Dolly Varden property consists of volcano-sedimentary rocks belonging mostly to the lower and middle Jurassic Hazelton Group.
The principal silver-base metal deposits are interpreted to be volcanic exhalative in origin found in the Kitsault River valley. Deposits of this type are formed as sub-aqueous hot-spring type deposits on the seafloor, as products of hydrothermal solutions that have vented from sub-seafloor fracture and fault systems.
Notably, the silver deposits of the upper Kitsault valley are mapped with important geological similarities to the Eskay Creek deposit, providing an analog for exploration on the Dolly Varden property.
“The exciting thing about the Dolly Varden project is that it is hosted in the Hazelton formation, a Jurassic package of volcanic rocks that went through the same expansion or release of pressure called the Eskay Rift period,” head geologist Rob van Egmond previously said in an AOTH interview.
“That was the time frame when a lot of the metallogenic deposits throughout the whole Golden Triangle were emplaced, such as Eskay Creek. After that rifting, there was a compressional period which formed a lot of the structures that host the epithermal veins. And a lot of those epithermal veins were probably active to form the deposits that were on the seafloor, VMS-style.”
Mineralization at Eskay has been the focus of considerable exploration activity dating back to the 1930s. When in production, it was the highest-grade gold mine in the world, having produced 3.3 million ounces of gold and 160 million ounces of silver at average grades of 45 g/t gold and 2,224 g/t silver during 1994-2008.
CEO Shawn Khunkhun likes to compare DV to Skeena Resources, the Eskay Creek project owner, which has seen a significant re-rating commensurate with its success so far in developing the historical mine.
“Our story is very similar,” he said. “They’re awakening Eskay Creek, we’re reawakening the Dolly Varden silver mine. It’s got a rich history, it’s one of the richest silver mines in the world, it’s produced 20 million ounces of high-grade silver, and we’re endowed with 44 million ounces in a cornerstone high-grade pure silver resource, and we’ve got a technical team that has the ability to unlock further discoveries in this trend.”
Will DV follow Skeena’s path? Given the project’s location within one of the richest mineralized regions on the planet, there’s a good chance of that happening.
BC’s Golden Triangle
When it comes to silver mining, the prolific Golden Triangle of BC simply cannot be overlooked.
The Golden Triangle takes its name from a 500-kilometre belt of mineralization that stretches from the BC-Yukon border in the north, to the town of Kitsault, just southeast of the port of Stewart. The Kitsault area is historically associated with molybdenum and silver production.
With over a century of mining history, it is the site of three gold rushes and some of Canada’s greatest mines, including Premier, Snip and Eskay Creek. Other significant and well-known deposits include Brucejack, Galore Creek, Copper Canyon, Schaft Creek, KSM, Granduc and Red Chris.
Despite being dormant for a number of years due to low metals prices, the mining district has seen a resurgence over recent years, driven by factors such as new infrastructure investment by the BC government, receding glaciers revealing fresh mineralization, and new technologies that allow geologists to gain a better understanding of the region’s complex geology.
As for the Dolly Varden property, it is situated in the bottom corner of the Golden Triangle (see map below).
The property lies to the west of Hecla Mining’s (NYSE: HL) Kinskuch project, an early-stage project with the potential for discovery of epithermal silver-gold, gold-rich porphyry and VMS deposits.
It also borders Fury Gold Mines’ (TSX: FURY) Homestake Ridge, where a PEA envisions a 13-year mine with peak annual production of just over 88,000 gold-equivalent ounces.
Drilling and underground work that went into the project’s resource estimation confirmed that the mineralization occurs as two styles: bedding-parallel VMS, similar to that mined at Eskay Creek, as well as cross-cutting epithermal mineralization similar to that being developed at Pretium’s Valley of the Kings deposit (Brucejack Mine).
According to DV, both the Eskay Creek and Valley of the Kings deposits are located on the same structural trend to the north of Dolly Varden’s ground. Dolly Varden represents the silver end of these styles of mineralization and includes the base metals lead and zinc.
Could Dolly Varden represent the southern end of a silver district that extends northward? It seems likely and further exploration — starting with the 2021 drill program — may prove it.
At a time when commodity prices (including silver) are on the rise again, this may be the best time for companies like Dolly Varden to ramp up exploration in the mineral-rich Golden Triangle.
Being a rare high-grade, pure-play silver project also gives the company an edge, as most miners in the area are hunting mainly for gold.
The discovery potential on the Dolly Varden is huge, given the existing deposits are all open along strike and downdip in some cases, along a large silver trend that contains the former Torbrit mine.
The 2021 drilling will specifically target the Western and Southern gold belts, the former being an alteration trend that aligns perfectly with Fury’s Homestake Ridge project.
All signs are pointing to a second Torbrit-style deposit, which last year’s drilling has hinted at. If all goes well, we might see Dolly Varden’s silver resources more than triple, surpassing 100 million ounces in total.
Dolly Varden Silver Corp.
Shares Outstanding 130.6m
Market cap Cdn$79.6m
Richard (Rick) Mills
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