Thank you very much. It's a pleasure to be presenting to you all today. Six years ago, the executive team at Bunker Hill came to Bunker Hill and took over a company that had a lease with an option to purchase the Bunker Hill Mine in northern Idaho. I stand here today, happy to say that we've now moved into production at Bunker Hill. We'll be at full commercial production by the end of the year. We had our vision right from the start to build a multi-asset, mid-tiered mining company. When you look at the mining space in the United States, it's dominated by major players right at the top and quite a few exploration companies, and nobody in the middle actually producing at a mid-tier level.
What I'm talking to you today about is a major transition in our company with an acquisition to take that next step towards being a multi-asset, mid-tiered producer in North America, U.S. specifically, focused on delivering strategic and critical metals with a precious component to the North American supply chain. This transaction for us, it creates scale. It creates a pipeline for future growth, strengthens the balance sheet, and really leverages our unique working relationship with regulatory agencies.
This new company joins Silver47 and Bunker Hill into what we believe will be a new U.S. silver champion, based around the Bunker Hill operating asset, generating cash flow to advance three, what we feel are world-class silver deposits, uniquely positioned all in the United States, all in favorable jurisdiction, between the Hughes deposit in southern Nevada in the Tonopah area, Mogollon in southwest New Mexico, and Red Mountain in Alaska. The new company certainly has scale at a pro forma market cap of just over $300 million, with a very diverse institutional shareholding, which includes strategics, metal trading firms, and a wide range of institutions. You can see a robust retail ownership around 61%, and a wide and diverse research coverage on the street.
When we're looking at a company right from day one, we were intentionally looking to build a company that had the capability and the bandwidth to grow into and develop a multi-asset, mid-tiered operating company. You could see the team here, the Bunker Hill team, joined by the Silver47 CEO, Galen McNamara. Just to point out, Tom Francis, our General Manager, came to us from Rio Tinto, where he was operating the Bingham Canyon open-pit. Mark Hayes, our General Counsel, who just joined the team, joins us from Rio Tinto as well. Myself and our Executive Chairman, Richard Williams, both came from Barrick. The resource of the pro forma company, you really begin to see the value and where we're going as a company.
Coming out of the transaction at nearly 400 million oz silver equivalent, puts us incredibly well-positioned when you look at a developer resource base or a producer resource base. This is just the starting point, and as we go through the assets, I'll be talking about the significant upside opportunity that each one of these assets has in turn. Starting with Bunker Hill. Bunker Hill's located in Silver Valley of northern Idaho, one of the largest silver-producing districts that the world's ever seen, 1.2 billion oz of silver produced to date. You have the Hecla Mine, Lucky Friday operated by Hecla on the eastern extent, Americas Gold and Silver. Sunshine is moving towards restarting production, and Bunker Hill on the western flank. In a lot of ways, most ways, the dominant mineral endowment in the Silver Valley.
Supported a vertically integrated lead and zinc smelting operation for over 100 years, and over that period of time, produced 165 million oz of silver. Zooming into Bunker Hill, all of that production came out of the existing mine footprint, which represents about 25% of the total land package. When we look across that land package, there's incredible opportunity for growth. I often get the question: Why wasn't the land package explored more when the mine was in operation? The real very simple answer is that the mine replaced reserves every year for 100 years and was shut down for environmental performance reasons at the smelter with 10 years worth of reserves left in the underground mine.
The mine that is in operation now, 1,800 tons a day, creating a zinc concentrate and a silver lead concentrate, all of which is sold to Teck Metals and further refined in their Trail smelter in British Columbia. Tails are re-placed directly into the underground, into historic mining voids. We will have a small dry stack facility that is fully permitted out in the next couple of years. This is the largest and newest processing facility in the Silver Valley. When we look at the levers for growth here at the Bunker Hill asset, it's really two levers that we're looking to pull.
Although we have quite a large resource base at 14 million tons in total mineral inventory, 7 million in the measured and indicated category, 7 million in the inferred category, it is in large part a relic of the reserve when the mine went into closure, upgraded to modern standards. You see a focus on zinc and to a lesser extent, lead and silver. Keep in mind that this mine was never explored for silver from a silver forward basis. We'll talk about exploration in a minute. We're already working on expanding that throughput from 1,800 tons a day to 2,500 tons a day, which represents roughly a 30% increase in throughput and metal production on the base resource that we have here.
What's really exciting about Bunker Hill, and what drew us to Bunker Hill right from the beginning, is the opportunity to look at an asset with long-term demonstrated mineral potential from a completely new perspective, and that's from silver and looking at silver forward. Our thesis has been that within the existing mine footprint, let alone the larger mineral endowment, there is tremendous upside from silver. We see that because in the historic drill hole data set, you see numerous examples of high-grade intercepts that were not mined and were completely outside of the historic reserve and outside of our resource, but are in close proximity to existing underground workings. We initiated our first real exploration program over the course of the summer in a target that we called Cate-8.
We were expecting to find a silver vein 3-5 ft wide that would be a nice supplemental feed to the head grade and into the mill. What we found was something entirely different. The first hole was 30 ft of continuous galena silver mineralization. We were looking at that, and we were trying to understand, okay, well, this is quite a bit different than what we saw. What we found is that in that historic drill set that we were looking at, yes, there was 3-5 ft of silver mineralization, but it was within a 20 ft zone where the rest of it was no return on the drill core.
With that, we accelerated that exploration program, and by the end of the year, we'll be publishing a resource on this Cate-8 target in the measured and indicated category that will roll directly into reserves and into the mine plan and into the mill feed in 2027. Discovery cost, because of its close proximity to underground workings, is going to come in at around $0.25/oz on a silver equivalent basis. The longest drill hole that we drilled is 300 ft, and we're actually already developing in mineralization on two levels. That's just one example of the potential and a demonstration of the potential that exists within the existing Bunker Hill workings. There's at least another dozen targets that are as good or better than this one. In addition at Bunker Hill, it's the shallowest of all the major mines in the Silver Valley.
When the mine went into closure, the depth of the mine was 4,000 ft. For comparison, the Lucky Friday mine has reserves down over 9,000 ft, and when the mine went into closure, there was four high-grade silver veins being mined, and there was an active study that was investigating deepening the shafts by an additional 1,500 ft. We see that Bunker Hill, historically known as a base metal mine with a silver credit, has all the potential in the world to be a silver forward producer, and that's the trajectory that we're going for value creation alongside a throughput increase from 1,800- 2,500 tons a day. The Silver47 assets, we'll start with Hughes. Hughes represents half of the Tonopah Silver District, and this is a district that between current resource and historic production, had a 500 million oz silver endowment.
The resource as it stands right now is mostly comprised in the western edge of the Hughes project and sits at 10 million oz in the indicated category, another 33 million oz in the inferred category, and it has a small tailings endowment in a resource category as well. It is important to note that when we say silver equivalent in the Hughes deposit, we are talking the silver equivalency between silver and gold. When we look at the detail and the strategy for the Hughes deposit, the existing resource, as I said, is on the western extent on the border and are surrounding the historic workings. But what is exciting about Hughes is there is an additional 4.2 km of mineralized vein system to the east, and that is where the focus is.
We see this as an opportunity to add hundreds of millions of ounces in a demonstrated district with demonstrated expansion potential to the east over 4 km long. The tails, it is worth mentioning, really because of where current metal prices are today. There is 2.7 million oz of silver equivalent resource in a historic tails. It is amenable to cyanide recovery. At $20 silver, it was probably a break-even prospect. But at metal prices today, it gives us the opportunity to potentially generate near-term cash flow, a nice little tidy project over two-three years, and at the same time, address the deposition of historic mine tailings in a water course and drainage. It is a dry water course, but nevertheless. This is on private and patented land, which simplifies the regulatory process as well.
Red Mountain is in Fairbanks, and I think whenever you are talking about a deposit or an opportunity in Alaska, geography is critically important. This deposit on its western flank is 10 miles away from the rail head in Healy, Alaska, and 5 miles away from roads that are associated with an active open pit coal mine. This is not terribly remote from an Alaskan context. There is an existing resource on the asset around Dry Creek and West Tundra Flats. The VMS district, with high-grade mineralization from surface with 15 million tons in resource at the moment. The drill program this year is likely to increase both the tonnage and the grade of that, and we have now identified three core higher grade shoots within that mineralization. The Dry Creek is completely open along strike and at depth.
In addition, the Silver47 team. team initiated a new exploration target program around the Second Chance Zone on the western flank of the mineral endowment. This is potentially something that is incredibly exciting. The drill hole that was drilled there, 190 m of continuous sulfide mineralization, 75 of which was visible massive sulfide mineralization. We are about five-six weeks away from having assay returns, but we are pretty excited about what this represents, which is a VMS district that is very lightly explored with an existing resource, geographically located in a way that as we develop the resource and as we move the project forward, that it can actually be built. It is all on Alaskan land, and again, as I said, in close proximity to it from an infrastructure perspective.
Mogollon in southwestern New Mexico is probably the largest unexplored silver vein field left in North America. If this were across the border in Mexico, it would've probably been mined 200 or 300 years ago. 77 km of unexplored veins with a resource centered around historic workings, that show significant mineralization open at depth, open along strike, and has a footprint of private and patented land. From the Mogollon perspective, the sky is the limit. We're just now beginning to open up this district and really understand its full potential. When you look forward over the coming months, how are we going to bring these two companies together, and what is our strategy going to be? Well, it's really quite clear and quite simple. The Bunker Hill Mine is the cash flow engine for a value-creating company. We will be at commercial production by the end of the year.
Through the course of the remainder of the year and through 2027, we'll be bringing the Cate-8 resource and publishing that, bringing that into reserves to increase the grade profile of the resource and the mill feed at Bunker Hill. We're looking at and will be expanding to 2,500 tons a day of throughput through the course of 2027 at the Bunker Hill Mine, and continuing aggressive exploration to continue to transition the existing resource to a more silver-dominant resource. The Bunker Hill Mine is going to generate enough cash flow to make a concerted long-term investment of $10 million-$15 million worth of exploration across three of the most prospective silver assets that are available in the United States.
Not only from the perspective of the mineral endowment, but the pathway to go from a resource and bring it into production in a reasonable timeline. We're incredibly excited about the future of Bunker Hill and the future that Silver47 has to build and take the next step towards a multi-asset, mid-tiered, U.S.-focused mining company.
I'll take any questions. Yes.
Please wait for the microphone.
John DeMaso . I paid attention to your company and hosted your company once in 2017 at my conferences, earlier regime. Just as I look at the 52-week range, the high was $6 higher, and you have some press releases about drawing down credit. Could you explain why the stock is down over the last year when the zinc price rose, and what the rationale is for the merger with Silver47 ? I'm not familiar with Silver47 at all. So I just don't understand why zinc is up and the stock is down. Is it just the silver price down or are you out of money? Does Silver47 have cash? What's going on?
No, thanks for the question, John. I think when we look at it, number one, the stock, particularly over the last month or so, has traded pretty closely with silver. I think that it certainly has not traded in concert with zinc, so that is one thing. I think the other thing that when we are out there talking to the market, there is certainly an approach of, okay, you are in a very critical time as a company. You are going through the commissioning phase, you have just finished construction, transitioning into production. How is that transition going and how is that looking?
I think that we are going to demonstrate and we are demonstrating we will be in commercial production by the end of the year. There is quite a lot of upside with that transition to commercial production with the addition of the Cate-8 resource into the mine plan. We feel that this is really the classic bottom of the second trough of the Lassonde Curve.
How much is cash, debt, and reclamation pro forma the merger?
On the debt side, we will be right around $80 million in debt. Cash, we will be right in the $40 million range from a cash pro forma is what we are projecting. Let me just go back on that slide because we can look at what the pro forma numbers are. We will be well positioned. We are in a perfect position to move forward and join these two assets.
All right. Well, we're pretty much out of time, unless there's another one, please join me in thanking Sam for his presentation.
Thank you.