By Ronald Wortel, MBA, P. Eng.
OTCQB: EQMEF| TSX-V: EQTY
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Equity Metals Corporation (OTCQB: EQMEF; TSX-V: EQTY) has released an updated NI 43-101 Mineral Resource Estimate for its 100%-owned Silver Queen silver-gold project in central British Columbia. At first glance the headline looks flat: 83.7 million ounces of silver equivalent (AgEq) in all categories, compared with 85.3 million ounces in the 2022 estimate. In our view, that comparison misses what changed.
Vein 3 Drill intercept SQ26-178 from 159 m
Source: Company supplied photo
The 2026 estimate adds 87 holes and 34,482 meters of drilling. Tonnage rose 62% to 8.7 million tonnes, and contained silver, gold, copper, lead and zinc all increased. Inferred tonnage alone rose 169%. Headline ounces fell because the silver price used in the estimate nearly doubled, so the other metals convert into fewer silver-equivalent ounces. Each AgEq ounce now carries about C$34.80 of net smelter return (NSR) value, versus C$17.70 in 2022. Measured on the 2022 report’s own formula, the resource totals 108 million ounces, up 27%. The resource’s in situ NSR value rose to C$2.92 billion from C$1.51 billion. About 58% of that gain came from metal prices and the rest from a larger resource.
The estimate is also more conservative. The consultants used stope optimization and dilution to test reasonable prospects for eventual economic extraction, and raised the NSR cut-off to C$122 per tonne. At current prices, that cut-off is about 20% lower than 2022’s in real terms, bringing lower-grade material into the resource. The result is a larger, lower-risk base for future economic studies.
Since the estimate, Equity has reported 17 validation holes on the No. 3 Vein. They confirm the historical drilling grades with no systematic bias and show that the vein margins carry grade at or above cut-off. A fully funded 2,500-meter fall program targets the areas most affected by dilution. A permit to rehabilitate the Earl Adit will allow a drone LiDAR survey of the historical underground workings. Metallurgical work on recovering gold from the pyrite concentrate could add about 5.9 million AgEq ounces if recovery returns to the 70% used in 2022. With about C$4.5 million in cash, the company is funded through 2027.
Our valuation applies 2% of the silver price to the resource, plus probability-weighted additions from the 2026 programs and our modelled 2027 drilling. Our updated fair value is US$0.40 per share, with a range of US$0.35 to US$0.43 across silver prices of C$65 to C$80 per ounce.
Vein 3 Drill intercept SQ26-173 from 288 m
Source: Company supplied photo
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