Preliminary drilling at the Shahuindo gold-silver property in Peru has led to the discovery of further promising mineralization for
Situated 15 km west of the city of Cajamarca, Shahuindo is in the middle of the metallogenic belt that is marked at either end by the Yanacocha and Pierina gold mines. About 32 km to the south is the multi-million-ounce Lagunas Norte deposit of
Shahuindo was first worked in the late 1980s, when a small-scale vat-leaching operation exploited gold-bearing oxides in the San Jose area. Next came Asarco, which, before its takeover
As occurs elsewhere in the district, mineralization at San Jose is hosted mainly by Cretaceous-aged sedimentary rocks of the Chimu formation. The deposit itself follows a local contact with a younger quartz-feldspar porphyry that intruded the units in the Late Tertiary.
In late 2002, Sulliden inked a deal to earn a 100% stake by paying US$4.13 million to the underlying vendor. Since then, it has handed Socrate Capital a 30% participating rate in exchange for US$1.5 million.
To date, Sulliden has surveyed the San Jose area using magnetic and induced-polarization techniques, and sunk 3,450 metres in 27 holes around San Jose. Eight of those holes outline a mineralized zone, known as Breccia, over a strike length of 500 metres.
“Asarco had intersected the breccia at the bottom of two holes but never recognized it as an outward extension from the contact between the intrusion and the sediments,” explains Sulliden President Jacques Trottier. “The Breccia zone is in the sedimentary package, not the contact zone.”
Unlike San Jose, which strikes northwesterly, parallel to the contact, the Breccia zone strikes to the northeast. It also seems to be flat rather than vertical.
Adds Trottier: “I think there were multiple phases of mineralization, because San Jose has a low silver-gold ratio relative to the Breccia zone. This breccia seems to be very late-stage.”
The best results came from hole 9, which cut 52 metres running 2.14 grams gold and 85 grams silver starting at surface. The first 30 metres ran 3.17 grams gold and 133 grams silver, whereas a second interval, farther down-hole, between 121 and 202 metres, carried 1.09 grams gold and 83 grams silver.
About 150 metres to the northeast, hole 8 returned similar results — 1.49 grams gold and 159 grams silver over 65.4 metres, including 45 metres at 1.98 grams gold and 219 grams silver. That interval began 37 metres down-hole.
Results from four other holes (the remaining two twinned earlier ones and returned similar results) include the following:
— 1.38 grams gold and 141 grams silver over 58 metres, starting at 51.5 metres, immediately followed by 54 metres of 0.86 gram gold and 113 grams silver;
— 0.85 gram gold and 51 grams silver over 47.4 metres starting at 75 metres;
— 1.24 grams gold and 22 grams silver over 24 metres starting at 57 metres, and 0.91 gram gold and 50 grams silver over 48 metres starting at 102 metres; and
— 1.15 grams gold and 44 grams silver over 140 metres, including 2.17 grams gold and 97 grams silver over 52.5 metres.
Mineralization remains open.
Meanwhile, five holes drilled in the San Jose zone itself returned 0.46 gram gold and 17 grams silver over 94.9 metres, and 13.16 grams gold and 40 grams silver over 4.5 metres. The former interval includes 24 metres at 0.95 gram gold and 26 grams silver, whereas the latter is part of a wider interval that ended in mineralization.
Results to date are comparable with Asarco’s average resource values.
Five prospects
Several other holes highlighted five new prospects for follow-up investigation. The West and South Contact targets are similar to San Jose whereas the East prospect is more silicified than argillized, as well as being located on the southern side of a fault that truncates San Jose at its southeastern end and is thought to strike northwesterly, similar to the Breccia zone.
At the West area, hole 16 averaged 0.95 gram gold and 2 grams silver over 30 metres, including 2.61 grams gold and 6 grams silver over the final 7.5 metres. Similarly, South Contact yielded 22.5 metres at 1.02 grams over 22.5 metres starting at surface, as well as 42 metres grading 0.52 gram gold and 1.6 grams silver starting at 57 metres down-hole.
The West target is about 500 metres west of San Jose’s northeastern limit, whereas South Contact sits on the other side of the porphyry.
At the East area, hole 24 averaged 1.49 grams gold and 13.8 grams silver over 69 metres starting from surface. Hole 25 cut three separate mineralized intervals:
— 24 metres grading 0.32 gram gold and 5.6 grams silver:
— 4.5 metres of 0.42 gram gold and 1.3 grams silver; and
— 8 metres of 0.49 gram gold and 12.4 grams silver.
Both holes were collared at the northern end of the target. Asarco had drilled the target’s southern tip and attached it to the San Jose zone.
Two holes drilled in the intrusion itself also intersected mineralization, with 0.87 gram and 9 grams silver reported over 36 metres of hole 1 and 0.62 gram gold and 6.4 grams silver over 45 metres of hole 2. The former interval began 21 metres down-hole, and the latter, at surface. Both are associated with tectonic and hydrothermal brecciation.
Cerro Redondo
In the Cerro Redondo area, each of two holes yielded less than a third of a gram of gold and one gram of silver over 33 and 19 metres. Geophysical work suggests drilling to the southeast will yield better results.
Cerro Redondo is south of San Jose, near the contact with an intrusive body.
Six other holes that were collared in other target areas failed to return any significant results.
Geochemical surveying around the drill-tested area and elsewhere on the 79-sq.-km property continues in preparation for the next phase of drilling. The campaign will include 10,000 metres and should begin in 6-8 weeks, pending the government’s acceptance of an environmental impact study (now under way).
The upcoming program also will test the property’s potential for hosting unoxidized gold deposits, given that upwards of 21 grams over 2 metres of primary sulphides have been intersected in drilling. A few metallurgical tests by Asarco suggests that such material would be amenable to standard flotation and cyanidation processing.
Recoveries from oxide samples topped 80% in less than 48 hours under leach.
Sulliden has just under 34.2 million shares outstanding, or 45.4 million fully diluted. This includes the shares and warrants recently issued by Sulliden in a $6.25-million private placement.
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