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There are at least five companies mining silver in New South Wales right now. Learn more about silver stocks in this key Australian state, as well as its rich history with the precious metal.

New South Wales is where silver mining began in Australia, and where the modern company known as BHP (ASX:BHP,NYSE:BHP,LSE:BHP) has roots dating back more than a century.

Silver was discovered at Broken Hill in the west of New South Wales in 1883. Two short years later, the Broken Hill Proprietary Company was floated, and from there the rest is history.

Broken Hill Proprietary, now known simply as BHP, rapidly became the largest mining company in Australia, and then the world, by diversifying, acquiring, merging and spreading its reach so that it had assets and interests on four continents — and it all began with the discovery of silver in New South Wales.

New South Wales' strong silver-mining history

BHP doesn't have silver operations in New South Wales today, but the legacy of silver continues in the state.

Australia has a reputation for being a desirable mining jurisdiction, but as an investment prospect, New South Wales is one of the country's less attractive areas, ranking fifth out of seven among its states and territories.

Globally, however, New South Wales is a safe bet, outranking Chile in mining investment attractiveness, according to the Fraser Institute's latest survey of mining companies.

There are at least five companies currently mining silver in the state, as per government data — though many of them are private. Publicly traded entities are accessible through the Australian Securities Exchange (ASX).

Overall, Australia is ranked among the top global producers of silver, sharing the title of fifth largest producer with Chile and Poland in 2020. It put out 1,300 tonnes of the precious metal that year.

It's worth noting that the amount of silver mined in Australia used to be much higher. Going back through US Geological Survey reports, the country enjoyed a spike in silver mining around the turn of the millennium, when annual production hovered around 2,000 tonnes per year. Since then, it's slowly fallen away to where it sits now.

For its part, New South Wales produced 128 tonnes of silver in the 2015/2016 financial year — a number that is fairly consistent year-on-year due to the number of operational mines located there. Within the region, silver is mined as a by-product at each operational mine, all of which are in the central part of the state.

ASX-listed silver stocks in New South Wales

As mentioned, quite a few of the companies mining silver in New South Wales are private, while others are public, but not listed on the ASX. Examples include China Molybdenum (OTC Pink:CMCLF,HKEX:3993) and Nonfemet.

Of course, public entities are busy in the state too. Read on for a look at some of the ASX-listed operators focused on silver in New South Wales. And if you're interested in jumping into the market, tools to learn how to invest on the ASX are freely available online through the ASX website — here's a little starter to make it even easier.

1. Newcrest Mining (ASX:NCM)

Market cap: AU$20.23 billion; current share price: AU$24.73

True to form, silver is produced as a by-product by the top mining company with silver operations in New South Wales — Newcrest Mining's Cadia operation is actually mainly centered on copper and gold. Even so, for the 12 months ended June 30, 2021, Cadia put out 643,000 ounces of the white metal, accounting for the vast majority of the company's overall silver production globally (945,000 ounces overall in the latest annual period).

2. Aeris Resources (ASX:AIS)

Market cap: AU$461.58 million; current share price: AU$0.21

Another company with interests mainly in copper and gold, Aeris Resources is the owner and operator of the Tritton copper operation. Silver plays so little a role in the company's profile that it doesn't list its output of the metal, but it has been hitting some silver mineralization in exploration works at Tritton over the last few months, with holes drilled at the Constellation deposit yielding results as fancy as 28.6 grams per tonne silver.

The company has also reported silver mineralization at the nearby Avoca Tank exploration project.

3. Silver Mines (ASX:SVL)

Market cap: AU$261.49 million; current share price: AU$0.21

Silver Mines is the owner of the Bowdens silver project in Central New South Wales, and the company describes it as one of Australia's largest undeveloped silver resources. The company also has interests in another two silver projects in the state: Conrad and Webbs, both located in the north.

The company's goal is to become one of Australia's preeminent silver companies.

A feasibility study for Bowdens was completed in 2018, and envisions a maiden ore reserve of 29.9 million tonnes at 69 grams per tonne silver, 0.44 percent zinc and 0.32 percent lead for a 16 year mine life initially. Since 2018, the company has fine tuned the proposed mine, and recently began a scoping study on underground mining.

Don't forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Scott Tibballs, currently hold no direct investment interest in any company mentioned in this article.

Global News
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"We are very likely going to experience the greatest silver bull market of our generation," said author and newsletter writer Peter Krauth.

Peter Krauth: Silver "Very, Very Undervalued," Ways to Play this Volatile Sector

Peter Krauth, editor of Silver Stock Investor, joined the Investing News Network to discuss his new book, "The Great Silver Bull: Crush Inflation and Profit as the Dollar Dies."

Although gold is the most popular of the precious metals, silver has a loyal following, and Krauth believe it's set to shine brightly as market elements like inflation spiral out of control.

"It's very, very undervalued," he explained during the interview. "It's very difficult to find a better value for your money right now — silver is definitely the place for that."

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Galena Mining

Capitalizing on its low-risk Tier 1 asset in a Tier 1 jurisdiction, strengthened by partnerships with one of the world's top base metals trading firms.

Company Highlights

  • Completed a bankable feasibility study (BFS):
    • 16 year lifespan producing high-value, high-grade lead-silver concentrate
    • Pre-tax NPV of A$553M at spot prices
    • C1 direct cash cost to be among the lowest for global primary lead producers at US$0.44/lb
    • Estimated pre-production capital expenditure of A$170M
    • Higher NPV, longer mine life and lower C1 direct cash cost compared to PFS
  • Major partnerships include Toho Zinc, Japan's largest zinc and lead smelter and IXM SA, one of the top three base metals trading firms in the world.
  • The Abra project is located in the Gascoyne Region of Western Australia, home to one of the largest undeveloped lead deposits in the world and the highest-grade lead concentrate available globally.
    • The Abra project carries a JORC estimate of 16.7 Mt at 8.5 percent lead and 24 g/t silver in the indicated category and 24.4 Mt at 6.5 percent lead and 14 g/t silver in the inferred category.
    • The Abra project has been named the world's lowest cost primary lead mine by Wood Mackenzie, a leading mining research and consultancy group.
  • Initial construction activities have been commenced, with the project being "shovel ready" to commence the plant construction and deployment of the mining contractor.
  • US$110 million of project financing debt facilities have been procured from leading mining-specialist lending fund Taurus Funds Management.
  • Galena's management team brings decades of experience in the mining and base metals industry and has a proven track record of success throughout all stages of an exploration, from development to production.

Company Overview

Galena Mining (ASX: G1A) owns the Abra base metals project located in the Gascoyne region of Western Australia — home to one of the largest lead and silver deposits in the world set to produce the highest-grade, cleanest lead concentrate available globally. The company is capitalizing on its low-risk Tier 1 asset in a Tier 1 jurisdiction, strengthened by and leveraging partnerships with Japan's largest zinc and lead smelter, as well as with one of the top base metals trading firms in the world.

Galena recently completed a bankable feasibility study (BFS) for the development of a mine and processing facility with a 16 year lifespan producing high-value, high-grade lead-silver concentrate. Lead production is estimated at 95 kilotonnes per year while silver mining is projected to yield 805 kilo ounces annually. According to a pre-development capital expenditure estimate of AU$170 million, the BFS modelled a pre-tax net present value for Abra of AU$553 million, and an internal rate of return of 39 percent. Additionally, the project's excellent location, infrastructure, and low technical risk saw this mine named as the world's lowest cost primary lead mine by Wood Mackenzie, a leading mining research and consultancy group.

Galena's major partnerships include Toho Zinc (TSE: 5707), Japan's largest zinc and lead smelter and IXM SA, one of the world's top three base metals trading firms. Toho is providing AU$90 million project equity and has a long-term agreement to purchase 40 percent of Abra's production, while IXM has entered into a 10 year take-or-pay offtake contract to purchase the remainder.

The CEO of Galena Mining, Alex Molyneux, commented, "We have secured firm offtake arrangements for all of Abra's production with Tier 1 buyers and these arrangements reflect the premium value of Abra's high-grade concentrate product. The IXM arrangement in particular demonstrates a higher value over and above the assumptions used in the feasibility study."

The Abra project carries JORC Mineral Resource estimates of 16.7 million tonnes (Mt) at 8.5 percent lead and 24 g/t silver in the indicated category and 24.4 Mt at 6.5 percent lead and 14 g/t silver in the inferred category. This mineral resource estimate published in December 2019 was substantially upgraded following drilling during 2019. Despite being at the construction phase, Galena continues to actively drill to optimise Abra. As of late 2020, there are three drill rigs operating at Abra drilling 1,400 to 1,800 cumulative metres per week. The lead-silver orebody remains open in multiple directions and there have been exciting copper and gold intersections where mineralisation remains open at depth.

All permits for the Abra project have been obtained from the appropriate Western Australian regulatory bodies. The project is also subject to an existing land use and heritage agreement with the Jidi Jidi Aboriginal Corporation. The Abra property is well-serviced by public roads and highways, and all the necessary infrastructure has been developed to transport lead-sulphide concentrates to the Port of Geraldton, Abra's primary export port.

The first tranches of equity investment from Toho have been used to undertake initial construction activities at Abra. This means the project now has a mined boxcut, production water facilities, the first module of its permanent accommodation village and various completed site infrastructure. It is "shovel ready" for the commencement of plant construction and deployment of the mining contractor.

The company's management team brings decades of experience in the mining and base metals industry and has a proven track record of success throughout all stages of an exploration, from development to production. Both CEO Alexander Molyneux and CFO Craig Barnes previously worked for Paladin Energy (ASX: PDN), a publicly traded uranium production company that operates two mines in Namibia and Malawi.

Taurus Fund Management, one of the world's largest investment management firms, has provided the project with US$110 million in project financing debt. Galena's CEO Molyneux commented, "The US$110 million of debt funding completes an efficient and fulsome funding package to bring the outstanding Abra base and precious metals project to fruition in a way that provides robust shareholder returns."

Key Projects

Abra Project

The Abra Base Metals Project is located in the Gascoyne region of Western Australia, approximately 110 kilometres from the DeGrussa copper mine owned by Sandfire Resources (ASX: SFR).

galena mining project location map

Bankable Feasibility Study

Galena has recently completed a bankable feasibility study (BFS) for the development of a mine and processing facility with a 16 year lifespan producing high-value, high-grade lead-silver concentrate. Lead production is estimated at 95 kilotons per year while silver mining is projected to yield 805 kilo ounces annually.

According to a pre-development capital expenditure estimate of AU$170 million, the BFS modelled a pre-tax net present value for Abra of AU$553 million, and an internal rate of return of 39 percent.

Ongoing Project Drilling

As of late 2020 there are three drill-rigs operating at Abra drilling 1,400 to 1,800 cumulative metres per week for infill and optimisation drilling.

Recently announced drilling results included the best high-grade lead-silver drill-hole ever at the project (hole AB147). It revealed that the mineable domain is approximately 30 metres closer to the surface than originally predicted. Significant intersections from AB147 included:

  • 5 m at 9.6 percent lead and 34 g/t silver from 266.2 m
  • 9 m at 7.3 percent lead and 20 g/t silver from 288.1 m
  • 5 m at 15.1 percent lead and 22 g/t silver from 321.8 m
  • 9 m at 17.1 percent lead and 26 g/t silver from 366.2 m

"We're astounded at the success of hole AB147 in targeting a potential 'metal rich' combination of grade and thickness on the northern part of the eastern limb of Abra's Indicated Resource area, which is shallow and close to the current plan for early decline infrastructure. We have added a number of follow-up holes around AB147 to the drilling program with the intention to bring this area into the early years of the mine plan as an optimisation," said Galena Mining's CEO and Managing Director Alex Molyneux.

Next Steps

The Abra project has received all major permits and approvals and has begun construction. The company plans to use the conventional underground mining method of long-hole open stoping with paste backfill. Shallow dipping areas will be mined using the room and pillar method. The processing plant will employ single-stage primary crushing and semi-autogenous grind million comminution to produce high-grade lead-silver concentrate.

Next steps for Galena include receiving another AU$60 million in investment tranches from Toho, hitting construction milestones and optimizing drilling results from a comprehensive drill program that was conducted in August. The company is also focused on active exploration of the Abra property to identify additional base and precious metals mineralization in the Edmund Basin.

Jillawarra Projects

The Jillawarra properties are located 20 to 80 km west of the Abra Base Metals Project within the Jillawarra sub-basin of Gascoyne, Western Australia. The Jillawarra sub-basin hosts several base metal resources, as well as manganese and gold prospects, which have been explored since the 1970s. The majority of the drilling performed on-site has investigated 100 to 200 meters below surface.

Galena has launched a continued exploration program that aims to identify additional mineralization of both base and precious metals. The primary prospective corridor lies within the fault between the Quartzite Well and the Lyons River, which extends east-west along the entire tenement package and indicates many of the same geological markers associated with the world-class Abra base metals project. Galena continues to target its Jillawarra assets through geophysics and an active drilling and exploration program.

Management Team

Alexander Molyneux - Managing Director and CEO

Alexander Molyneux is an executive and financier with 20 years of experience in the metals and mining industry. Between 2015 and 2018, Molyneux was CEO of Paladin Energy, one of the world's largest uranium companies, where he optimized its operating business and completed a US$700 million successful recapitalisation of the company and a re-listing on the ASX. Well-known for his breadth of experience in the mining industry, Molyneux serves on a number of public company boards, including: Metalla Royalty & Streaming, Argosy Minerals and Tempus Resources.

Troy Flannery - Abra Project CEO

Troy Flannery offers more than 20 years in the mining industry, including five years in corporate and 16 years in senior mining engineering and project development roles. Flannery has a degree in mining engineering as well as a master's degree in finance. He has achieved the First Class Mine Manager's Certificate of Competency. Flannery has worked at numerous mining companies, mining consultant agencies and contractors (including BHP, Newcrest, Xstrata, St. Barbara Mines and AMC Consultants).

Adrian Byass - Non-Executive Chairman

Adrian Byass has more than 20 years of experience in the mining industry both in listed and unlisted entities globally. He has served as non-executive and executive director of various listed and unlisted mining entities, which have successfully transitioned to production in bulk, precious and specialty metals around the world. He currently serves on boards of ASX phosphate, zinc, nickel and lithium companies.

Craig Barnes- Chief Financial Officer

Craig Barnes has over 20 years of experience in senior finance and financial management within the mining industry and previously the financial services industry. Barnes has considerable experience in project financing, mergers and acquisitions, joint ventures, treasury and implementation of accounting controls and systems.

Before joining Galena, Barnes held the position of CFO of Paladin Energy for more than five years and was part of the team that successfully completed the company's capital restructuring in 2018. Prior to that, he was the CFO of DRDGOLD and its affiliated subsidiaries for more than seven years, and he played a key role in the successful transformation of the company from an underground miner with two ultra-deep underground operations into a profitable tailings retreatment business.

Tony James -Non-Executive Director

Tony James offers more than 30 years of mine operating and project development experience predominantly in Washington. James is highly regarded for his work in building and operating base metals and offers expertise in both finance and mine construction. James has previous experience as a managing director of three ASX-listed companies with two of those companies successfully guided through a merger and takeover process to the benefit of the shareholders. He has a strong mine operating background (examples being the Kanowna Belle gold mine and the Black Swan nickel mine) and a strong feasibility study and mine development background (examples being the Pillara zinc and lead mine and the Trident Higginsville gold mine).

stock chart with red and green lines

Silver, copper and palladium are markets John Feneck of Feneck Consulting finds compelling, and he spoke about stocks he likes in all three spaces.

John Feneck: Fed Hike Takeaways; Silver, Copper and Palladium Stocks to Watch

Last week's US Federal Reserve meeting brought a much-anticipated interest rate hike of 50 basis points, with the central bank also announcing balance sheet reduction plans.

Speaking to the Investing News Network, John Feneck, portfolio manager and consultant at Feneck Consulting, gave his thoughts on the news, and also shared stocks he's watching in silver, copper and palladium.

"I think (the Fed) delivered the number they needed to," he said in a conversation a few hours after the Fed's announcement. "You saw that reflected in the broad market action afterwards ... especially when (Chair Jerome) Powell started talking at 2:30 p.m. EDT. Our sector also got a bid, which was very encouraging."

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kangaroos in front of the sunrise

Silver is on the rise in Australia, with new silver mines opening, production potential booming and the precious metal's valuation reaching new heights.

Analysts have been bullish on gold for the better part of the past decade, but now it's silver's time to shine. While the price of silver tends to rise and fall alongside that of gold, silver's valuation is generally more volatile — slower to move in either direction, but more prone to abrupt spikes and plunges.

Considering the market's longtime gold rush, silver is due for a major price hike. In 2020, silver hit a seven year high with 27 percent year-over-year growth, climbing faster than gold. Silver was on the rise again in February 2021, bolstered by WallStreetBets fervour. Though prices have stabilised since, they remain elevated compared to the past decade. Additionally, at only a fraction of gold's valuation, silver is a much more attainable buy.

Shrewd investors are looking to Australia for their silver picks. A country whose silver mines continued to flourish even when most of the world was in a precious metal slump, Australia has emerged from the COVID-19 pandemic as a major player in the global silver market.

A look at Australia and silver mining

When you think of mining in Australia, you may not think of silver, especially since the country is a top global producer of several other metals, including gold and iron ore. Nevertheless, silver is on the rise in Australia, with new silver mines opening, production potential booming and the precious metal's valuation reaching new heights.

This may be surprising news, especially since 2020 was an erratic year for silver. Global silver-mining production plunged by 5.9 percent in 2020 — its biggest drop in over 10 years —⁠ following four years of steady decline.

Output from primary silver mines plummeted by 11.9 percent year-over-year, while silver by-product suffered a more modest drop, with production from gold and lead-⁠zinc mines falling by 5.7 percent and 7.4 percent, respectively. Note that silver is largely produced as a by-product of other metal-mining processes, with 72 percent of silver production taking place at non-silver mines.

This production downturn was the result of COVID-19 restrictions that forced mines to suspend operations temporarily. Silver mine closures hit certain places harder than others, with extended closures in top silver-producing countries such as Peru, Mexico, Argentina and Bolivia causing major production drops.

Australia, however, was an exception to this rule, with production increasing by 3 percent. The reason for Australia's success is that it remained relatively untouched by COVID-19 restrictions. While other countries were forced to shut down production facilities, Australia was able to avoid these closures, continuing — and even upgrading — regular operations.

Australia is now the fifth largest silver producer globally, with an annual output of 43.8 million ounces in 2020. While the output of silver-mining giants such as Mexico and Peru (178.1 million and 109.7 million ounces produced in 2020, respectively) continues to far exceed that of Australia, global demand for silver is on the rise, hitting 900 million ounces annually and making room for a new silver-mining powerhouse.

What should investors know about silver investing in Australia?

Silver remains a relatively untapped resource in Australia, which means that investors have plenty of major mining companies to choose from.

Australia's largest mine is the Cannington mine owned by South32 (ASX:S32,OTC Pink:SHTLF). It is ranked as the ninth largest silver-producing mine worldwide, with 11.6 million ounces produced in 2020.

The country's second biggest silver-producing mine is the Mount Isa zinc mine. It is owned by Mount Isa Mines, a subsidiary of Glencore (LSE:GLEN,OTC Pink:GLCNF), and produced around 5.8 million ounces of silver in 2020. The Tritton copper mine, owned by Aeris Resources (ASX:AIS,OTC Pink:ARSRF), followed closely behind with nearly 4.5 million ounces produced in the same year.

Other notable Australian silver mines include the Golden Grove mine, which is owned by 29Metals (ASX:29M), and the Dugald River mine, which is owned by Metallic Minerals (ASX:MMG,TSXV:MMG,OTCQB:MMNGF). In 2020, these mines produced around 2.9 million and 2 million ounces of silver, respectively.

Australia's impressive silver-mining industry is well-positioned for further expansion, with Silver Mines (ASX:SVL,OTC Pink:SLVMF) planning to launch its Bowden silver project in 2023. This New South Wales-based silver mine is projected to produce around 6 million ounces of silver annually, which would make it the country's new second largest producer. The company hopes to capitalise on the promising solar panel market, which currently accounts for about 5.5 percent of all silver demand worldwide.

Moreover, Australian company Thomson Resources (ASX:TMZ,OTC Pink:TMZRF) bought the New South Wales-based Webb and Conrad silver projects from Silver Mines earlier this year in a transaction worth around US$8.6 million. The deal closed on March 31, and will enable Silver Mines to concentrate on its flagship Bowden project.

Investing in silver in Australia

There are many ways to invest in silver, including physical silver, stocks, exchange-traded funds (ETFs), mutual funds, options and futures. Choosing which investment route to take is all about balancing risk and reward.

Investing in physical silver is the most straightforward option: you simply buy a tangible piece of the precious metal in the form of bullion, official coins or medallions. Bullion is a bar or 1 ounce coin of solid silver with at least 99.9 percent purity. Official silver coins are currency produced by a government mint, while silver medallions resemble coins, but lack monetary value, .

The price of physical silver rises and falls alongside the metal's market value. Physical silver is a relatively safe investment, since its value can't be affected by third-party interference or bad business practices (risks characteristic of mining stocks). However, if you plan to trade often, the added costs of buying, selling and storing physical silver may make the investment not worth your while.

Investments in physical silver rose by 8 percent last year, boosted by silver's status as a safe asset and market bullishness on gold. In Australia, coins and medals fabrication increased by 35 percent year-over-year, making physical silver a smart choice for any risk-averse investor.

Of course, low risk often means low reward. If you're looking for a bigger payday, consider investing in silver-mining stocks instead. After all, when silver's market price goes up, it is often the case that the value of a mining stock could spike far higher than that of the physical metal. The disadvantage is that mining stocks are always risky — even when the silver market is strong, a mining endeavour can fail to pan out.

ETFs offer investors the best of both worlds. ETFs are a basket of varied equities, including physical metals and shares in mining companies. Much like individual stocks, they are liable to rise or fall in price according to the market, though they tend to be less risky than stocks.

In 2020, ETF investments were at an all-time-high, though Australia only has one silver ETF that includes the physical precious metal. Stocks are a much more common means of investing in silver in Australia. The country boasts over a dozen silver-mining companies, including South32 and Silver Mines, as well as Newcrest Mining (ASX:NCM,TSX:NCM,OTC Pink:NCMGF), Golden Deeps (ASX:GED) and Investigator Resources (ASX:IVR).

Don't forget to follow us @INN_Australia for real-time news updates.

Securities Disclosure: I, Isabel Armiento, hold no direct investment interest in any company mentioned in this article.

silver bars and coins
Aleksandar Mijatovic / Shutterstock

"It's like so many other minerals. We're going to blow through our global known reserves in no time at all," Matt Watson of Precious Metals Commodity Management said about silver.

Matt Watson: Silver Mine Supply Needs to Double, What's in Store for Prices?

Industrial demand for silver is increasing, and according to Matt Watson, mine supply will need to rise substantially in the near future in order to meet this growing need.

Watson, who is the founder of Precious Metals Commodity Management, said the electric vehicle, solar photovoltaic and electronics industries, among others, will all require increasing quantities of the white metal.

"The outlook for industrial demand is growing, there's just no doubt about it," he told the Investing News Network.

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Galena Mining

GALENA MINING LTD. (“Galena” or the “Company”) (ASX: G1A) is pleased to announce that the construction progress at its Abra Base Metals Mine (“Abra” or the “Project”) has reached 63% complete on 30 April 2022. Construction achievements during the month include completion of the first 1,000m of decline development and the commencement of the mining the first underground diamond drill chamber. Both GR Engineering Services Ltd. (“GR Engineering”) and Contract Power Australia Pty. Ltd. have made excellent progress at the processing plant and the power station sites.

Managing Director, Tony James commented, “During April we were fortunate to have only 10 COVID-19 isolation cases on site, which has had limited impact on construction works. It’s a credit to the site team on how they have navigated the pandemic-related challenges to date. By the end of April, the decline has reached the 1,380mRL level which is now 67m vertically above the orebody. It's also pleasing to see the development of the first underground diamond drilling drives.

At the processing plant a total of 1,527m3 (61%) of concrete has been poured on track to reach overall design volume of 2,500m3 on schedule. The construction of the fine ore bin is nearing completion and structural steel arriving on site is being installed".

Figure 1 – Lifting of the primary jaw crusher and fine ore bin top into position.