Eight holes drilled along strike of the Alamo Dorado gold-silver deposit in Mexico’s Sonora state have confirmed the updip continuity on several sections.
The work is part of an initial phase of infill drilling designed to expand reserves at the project, which is wholly owned by
Highlights included a high-grade, 25.5-metre intercept averaging 291 grams silver and 0.3 gram gold per tonne in hole 75, collared on the southern margin of the deposit (section 3+50 south). The company believes this area could represent a possible feeder system for the mineralization.
In May, drilling will attempt to extend the strike length of the known mineralization. Geological mapping has confirmed that intense alteration and mineralized stockwork occur along strike, northwest of the previously drilled area.
The Main zone sits atop and within a prominent north-striking ridge that rises some 250 metres from the valley floor. Drilling has traced the zone 600 metres along strike and up to several hundred metres in width. The zone dips shallowly to the west.
A prefeasibility report, prepared by Tucson, Ariz.-based Mintec, estimates open-pit reserves of 52.5 million tonnes grading 63 grams silver and 0.23 gram gold, equal to 106.5 million oz. silver and 394,200 oz. gold, or 129 million oz. silver-equivalent. The overall stripping ratio is projected at 1.82-to-1.
A total resource of 117.5 million oz. silver and 447,700 oz. gold, or 142.8 million oz silver-equivalent, is contained in 79.6 million tonnes grading 45.9 grams silver and 0.18 gram gold.
Metallurgical tests indicate the Alamo Dorado silver-gold mineralization is amenable to heap-leaching, with optimum recoveries occurring on material crushed to minus 3/8-inch. Recovery rates averaged 67% for silver and 77% for gold. Higher-grade material averaged 75% for silver and 76% for gold, following a 206-day leach period.
Based on a daily mining rate of 15,000 tonnes of ore (or 5.5 million tonnes per year), the project is anticipated to produce an average of 7.1 million oz. silver and 30,300 oz. gold annually over a 10-year mine life. Production in the first two years will be almost double the average annual output, owing to a higher-grade starter pit. Cash costs over the life of the mine are projected at US$2.96 per oz. silver-equivalent, with starter-pit costs pegged at US$1.55 per oz. during the first few years.
Estimated capital costs are estimated at US$45 million, with a payback period of just 18 months, based on a silver price of US$5.28 per oz. and a gold price of US$300 per oz.
Corner Bay is in the final stages of awarding a contract to an engineering firm for a feasibility study, which is targeted for completion by year-end. The latest drill results are outlined in the accompanying table.
SectionHoleTrue WidthSilverGold
(m)(g/t)(g/t)
0+50N68201310.34
0+50S69132580.26
1+00S70150*310.33
1+50S71150*240.19
2+00S72108280.23
2+50S73123520.28
3+00S74142.5490.26
3+50S75160.5990.25
incl.25.52910.30
*Note: mineralization was encountered throughout the length of the hole.
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