SILVER PRICE NEWS - The silver price climbed as much as 1.9% to $19.72 Wednesday afternoon - its highest level since March 19, 2008, amid the collapse of Bear Stearns crisis. Alongside the silver price rally, silver stocks have risen significantly as of late. Shares of Fortuna Silver Mines (FVI.TSX) have advanced 20.0% year-to-date - versus a 16.8% return for the silver price.
Fortuna Silver has not only outperformed the silver price, but also many of the world’s largest silver companies over the past year. Shares of FVI.TSX have surged 144.7% during the past 52 weeks - compared to returns of 43.8%, 27.7%, and -1.6% for Pan American Silver (PAAS), Silver Wheaton (SLW), and Silver Standard Resources (SSRI), respectively. The silver price leverage Fortuna has provided investors has been one of the main catalysts behind its ascent, along with the internal growth at its flagship Caylloma mine in Southern Peru.
Earlier today, the Canadian-based silver miner released drill results from the upper portion of the Animas Vein at Caylloma. Highlights of the results included Hole ANIS016010, which intersected 2,222 grams per tonne (g/t) of silver, 9.64 g/t of gold, 1.17% lead, and 3.02% zinc over 9.2 meters. As Fortuna previously reported on February 2, 2010, exploration raises and cross-cuts completed in late 2009 and early 2010 along the Animas structure above level 6 of the mine cut high-grade silver-gold mineralization.
Overall, the new results compare “extremely favorably” to the 156 g/t of silver average Proven and Probable Reserve grade for Caylloma - according to Fortuna - with 60% of the holes returning higher silver grades than those included in drill results from July 16, 2009.
Fortuna went on to say that the complete set of results of drilling and sampling of the underground workings are presently being compiled and interpreted, in preparation for the completion of a new resource and reserve estimate for the upper portion of the Animas Vein. Furthermore, development of the level 6 is ongoing and will allow the “rapid integration” of the new resources into the current mine plan.
With the silver price breaking out to fresh 2-year highs amid both the global economic recovery and rally in precious metals, silver stocks such as Fortuna Silver Mines have posted strong gains. If the price of silver maintains its longer-term uptrend and the company continues to improve production levels at Caylloma, the company may continue to deliver share price appreciation for shareholders.
