Aya Gold & Silver (AYASF) is the newest producer I’m adding to the portfolio – and it’s a true enigma in the silver space, as a PURE silver miner, explains Peter Krauth, editor of Silver Stock Investor.
If you’ve been following my research for a while, you know that more than 70% of mined silver is a by-product of mining other metals. Even when silver is the main product, it’s usually accompanied by gold, copper, zinc or lead.
But not in the case of Aya. The only metal they produce is silver, and that’s almost unheard of. What’s more, they operate in Morocco, a jurisdiction that is little known as a source of mined silver.
As usual, let’s start with who’s running the shop. Aya is led by Benoit Lasalle, the President and CEO. Lasalle has an impressive mining history spanning 20 years. Trained as an accountant, Lasalle founded Canadian based-SEMAFO, a West African gold miner which he grew from a junior to a +250,000 ounce-per-year gold producer, and to a $3.5 billion market cap before being sold.
Aya’s main assets and operations are located in Morocco’s Anti-Atlas Mountains. Morocco is a constitutional monarchy with a long history of political stability. Few people, myself included, realize that Morocco is rated as the #2 place to mine in the world by the Fraser Institute in the Policy Perception Index, ahead of places like Western Australia, Quebec, Nevada, and Finland.
Aya’s flagship property is Zgounder, a truly exceptional world class silver mine. It boasts 3 of the top 10 and 14 of the top 50 silver intercepts globally from 2020 – 2022. And in that time, the drill program generated 42 of the top 50 Zgounder intercepts historically. We’re talking about 1,972 g/t over 15.6m, all the way up to 3,956 g/t over 21.6m of silver.
Zgounder holds known reserves of 71Moz (257 g/t) Proven and Probable, within a total resource of 96Moz (306 g/t) Measured and Indicated, and another 6.4Moz (367 g/t) Inferred. Of these reserves, 29% are open pit and 71% underground ore, and the 11-year mine life is set to be extended as so far 71% of resources have been converted to reserves, with the deposit open at depth.
In addition to Zgounder, there are a number of other promising projects in the growth pipeline. Boumadine is several hundred km east of Zgounder, also in the Anti-Atlas mountains. It could be the wild card of Aya, and may turn out to be a multiple the size of Zgounder. But ultimate production at this project is still likely 4-5 years off.
Recommended Action: Buy AYASF.