"Further step-out exploration drill results demonstrate the potential to increase our initial 72.5 million tonne resource estimate announced on December 11, 2019," said Christopher Emerson, Pan American's vice president business development and geology.

"Drillholes U-88-19 and U-105-19 indicate extensions of high-grade massive sulphides to the southeast, while holes D-81-01-19 and S-81-19 indicate the resource may expand to the northeast."

Since the discovery in 2018, Pan American has drilled a total of approximately 60,000m on the La Colorada skarn.

In 2020, Pan American plans to invest US$16 million to $18 million on the drilling programme, early stage engineering and metallurgical testing for the La Colorada skarn discovery.

The 44,000m drill programme is focused on infill and exploration drilling to further define, expand and add confidence to the inferred resource estimate.

Pan American aims to provide an update on the initial resource estimate concurrent with the release of its annual mineral reserve and resource estimates in June 2020.