Resource Growth at Cerro Bayo Raises Questions on Project Timeline and Market Impact

Drilling Success at Cerro Bayo

Andean Silver Limited (ASX, ASL) has announced a series of compelling drilling results from its Cerro Bayo Silver-Gold Project in Chile’s Aysen region. The latest campaign, focused on the Laguna Verde Mine Complex, has successfully extended known mineralisation by up to 50 metres beyond the existing resource boundaries. Notably, these extensions are occurring in close proximity to the project’s processing infrastructure, a factor that could translate into significant cost savings for future mining operations.

Among the standout intercepts are high-grade silver and gold results, including an exceptional 2.0 metres grading 692 grams per tonne (g/t) silver and 9.8 g/t gold at the Delia SE deposit. Other notable intersections include 1.5 metres at 433 g/t silver equivalent at the Temer Vein complex and broad mineralised zones at the Appaloosa Breccia deposit, which support both open pit and underground mining scenarios.

Strategic Resource Growth and Upgrade

The current drilling program is dual-purpose, to grow the resource base and to convert inferred resources into the more certain measured and indicated categories. This conversion is critical for underpinning future economic studies and advancing the project towards production. Andean plans to maintain an aggressive drilling schedule through the first quarter of 2026, deploying three surface rigs to systematically explore and infill key mineralised zones.

Chief Executive Officer Tim Laneyrie highlighted the strategic importance of these results, noting that the extensions near processing facilities enhance the project’s economic potential. He also emphasized the discovery of numerous new outcropping vein systems and the promising indications from geophysical surveys suggesting additional mineralised structures beneath shallow cover.

Robust Financial Position Supports Accelerated Exploration

Andean Silver’s recent capital raising has bolstered its financial position, leaving the company with approximately A$64 million in cash. This strong balance sheet provides the flexibility to accelerate drilling activities and pursue the multiple growth opportunities identified across the Cerro Bayo mine district, which spans over 330 square kilometres.

The project currently hosts a global Mineral Resource Estimate of 9.8 million tonnes at 351 g/t silver equivalent, containing 111 million ounces of silver equivalent. The company’s exploration strategy combines brownfields drilling to expand existing resources with regional mapping and geophysical campaigns aimed at greenfield discoveries.

Looking Ahead

With infrastructure in place, an existing environmental impact assessment, and a silver market characterized by structural deficits, Andean Silver is positioning Cerro Bayo for a transformational year in 2026. The forthcoming resource update in the first half of 2026 will be a key milestone, potentially reshaping the project’s valuation and development timeline.