Enticing Guerrero belt attracts gold juniors

Newstrike Capital (NES-V) has hit encouraging infill gold intercepts at its Ana Paula project in southwestern Mexico’s Guerrero gold belt.

The delineation drilling, which targeted the project’s southeast, includes hole 12-97 that returned 12.3 metres grading 32.11 grams gold per tonne uncut and included half a metre at 760 grams gold.

Other definition drilling highlights include hole 12-100 that hit 37.6 metres of 4.81 grams gold and 6.35 grams silver from surface; hole 12-101 that cut 103 metres of 5.06 grams gold and 3.59 grams silver from 21 metres downhole; hole 12-102 that returned 48.5 metres of 2.48 grams gold and 4.6 grams silver from surface; and hole 12-103 that hit several short intercepts of fairly low grades.

As to stepout drilling, Newstrike concentrated its efforts in the southwest quadrant of the area. Hole 12-98, drilled to test the contact zone between highly altered sediments and an altered and mineralized intrusion that outcrops in the area, returned several low-grade intercepts, including: 10.3 metres of 46 grams gold and 7.1 grams silver, 10.9 metres of 0.67 gram gold and 16.3 grams silver and 7.6 metres of 0.71 gram gold and 3 grams silver.

June drill results from the delineation program included hole 12-90 that hit 102 metres at 1.22 grams gold and 54.1 metres at 2.05 grams gold, hole 12-92 that returned 88.1 metres at 1.12 grams gold and hole 12-94 that hit 83.3 metres at 1.07 grams gold, and 92.4 metres at 0.68 gram gold.

On news of the results Newstrike’s share price climbed 10¢, or 7.4% to $1.45, with about 840,000 shares traded. The company closed a $24.8-million financing in late March at $3.10 per share and has 114.9 million shares outstanding.

Elsewhere in the Guerrero gold belt, Cayden Resources (CYD-V) announced exploration results from its Morelos Sur project in late July. Highlights from trenching on the Magnetita target included 20 metres grading 6.39 grams gold and 27 metres averaging 0.48 gram gold, while drilling highlights included 28.5 metres carrying 3.21 grams gold, 39.3 metres carrying 0.65 gram gold and 7.7 metres grading 2.44 grams gold. Cayden started drilling the Magnetita target in June, and expects results out shortly.

Earlier in July the company released drill results from its Las Calles target, with results including 28.5 metres of 3.21 grams gold and 39.3 metres of 0.65 gram gold. The company stated that the results indicate the potential for a deeper, lateral extension of the Los Filos orebody, currently being mined by Goldcorp (G-T, GG-N).

More recently Cayden closed a $5.1-million financing at $1 per unit after originally setting out to raise $4.2 million. The company has hovered around $1 in recent weeks, with 36.4 million shares outstanding.

Torex Gold Resources (TXG-T), pushing forward its more advanced Morelos gold project in the area, recently secured the necessary water concessions for its proposed mine and mill at the project. The wells are located roughly 14 km from the proposed plant site.

In June the company announced the first results from its Media Luna target at its Morelos project, which showed consistent gold mineralization over a 900-metre strike length. Drill results included hole 1 that hit 4.8 metres of 6.13 grams gold, 58.7 grams silver and 2.4% copper, hole 2 that returned 4.4 metres of 4.27 grams gold, 9 grams silver and 0.78% copper and hole 8 that cut 7.1 metres of 6.56 grams gold, 10 grams silver and 1.15% copper.

Torex spent $23.4 million on exploration and evaluation expenditures in the six months ending April 30, compared with $11.8 million in the same period in 2011. At the end of April the company had $79.4 million in cash and a working capital balance of $85 million. The company has traded around $1.85 with 413.2 million shares outstanding.
Other companies operating in the Guerrero area include Oroco Resource (OCO-V), Guerrero Exploration (GEX-V) and Citation Resources (CTT-V).