• New silver-focused ETF highlights the rarity of standalone mines
• Silver Mines’ Bowden project set to produce a rare proportion of argentum
• Project now moving to definitive feasibility and advanced development

Special Report: The launch of the first ETF with a pure-play silver focus may well re-awaken interest in an ASX-listed sleeping silver giant.

Global asset manager Sprott’s new Silver Miners & Physical Silver ETF (NASDAQ: SLVR) has highlighted just how difficult it is for equity investors to find genuine silver leverage, as even it is challenged to find ‘pure-play’ producers.

SLVR has an allocation of about 18 per cent to physical silver and 82 per cent to pure-play equities, with Sprott defining ‘pure play’ as companies with at least 50 per cent of their revenue or assets tied to mining silver.

But Sprott says even the world’s top silver producers don’t meet the 50 per cent threshold for this ETF.

Steve Schoffstall, Sprott’s director of ETF product management, explained: “If you look at the 10 largest silver miners, none of them are primary silver miners. They have other drivers of their business, and lead and zinc combined make up about 31 per cent of their activity.”

He said when shopping around for silver producers investors could even be looking at companies that have single-digit percentages of their revenue actually coming from mining silver.

“That makes it difficult for investors to get their hands on pure-play silver equities,” Schoffstall noted.

Bowdens’ global profile

Waiting in the wings of a global supply squeeze scenario is Silver Mines’ (ASX:SVL) Bowdens project, which is forecast to have more than a whopping 86 per cent of its estimated revenue coming from silver.

That places SVL easily within Sprott’s pure-play definition and, importantly, on the radar of any investor seeking to leverage silver’s re-emerging safe haven appeal combined with expanding industrial demand from solar panels, EVs and the booming AI sector.

With Bowdens’ JORC reserve of 71.7Moz it’s the largest and most advanced undeveloped silver deposit in Australia and on the ASX.

On the global league tables, Bowdens is one of the most leveraged projects to the silver commodity price, the fourth largest undeveloped deposit and one of the most advanced.

Next steps in ’25

With an upgraded mineral resource estimate and optimisation study completed last year, Silver Mines’ focus for 2025 is on Bowdens’ development consent and advancing the project through to front-end engineering design (FEED).

“We very much look forward to continuing to advance Bowdens through to FEED, which could occur over the next 12 months depending on timing around regaining the Bowdens Consent,” Silver Mines MD Jo Battershill said.

Silver Mines had its development consent granted by the Independent Planning Commission of New South Wales (IPC) in April 2023.

But this was revoked last August by the NSW Court of Appeal on a minor point of administrative law relating to the transmission line to get power from the grid to site, only about 13 kilometres away.

Battershill said the Court of Appeal decision had the flow-on impact of placing a significant number of other state infrastructure development projects at risk. They include almost $50 billion worth of renewable energy projects in the state’s west, which all require offsite transmission lines.

“This prompted the state government to act very quickly to amend its relevant legislation to put the control of planning decisions back into the hands of the regulators, and not activist groups,” Battershill says.

“So where are we at? Well, now the legislative changes are complete, we believe we have a well-defined pathway to regaining our State Development Consent.

“We’ll continue to work with the state’s planning department over the next few months to ensure it has all the information required for it to make an updated recommendation to the IPC, and we remain convinced that the development consent will be reinstated.”

Upgrade upside 

Battershill says the reserves beyond the current mine plan will be considered in the definitive feasibility study to be released as the project moves towards advanced development.

On top of that, Battershill says the company always tries to have a rig spinning somewhere on the tenements.

“Given the large ore reserves and mineral resources in place, the project has significant optionality for future extensions of the open pit and the potential to access higher grades from an underground development,” he says.

The company is also making final preparations to start drilling at its Elsienora project, where a review of exploration data has highlighted the potential to host ‘McPhillamys’-style gold mineralisation.

This article was developed in collaboration with Silver Mines, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.