Canadian juniors look to light a fire in Jalisco

SITE VISIT

Ameca, Jalisco, Mexico — When talk turns to Mexican mining, Jalisco doesn’t have the historical cachet of Durango or the copper-fed importance of Sonora. But this state on the Pacific coast, long neglected by exploration companies, has good geology, good infrastructure, and one of the best economic environments in the country — all the right ingredients for success.

Two Canadian juniors, Soltoro (sol-v) and Southern Silver Exploration (SSV-V, SSVFF-O) are on the ground floor here, bringing some modern exploration techniques to bear on a mining district that was fairly quiet for most of the 20th century. Their progress will be a test of grassroots exploration in an underexplored part of the world, about 100 km west of Guadalajara.

Soltoro, created to hold a package of mining properties in Jalisco, is working on a large-scale bulk silver model in an area of small silver mines near Guachinango. About 20 km east of Guachinango, Southern Silver, with many of the people that made up Western Silver’s team, has a porphyry copper target in mind near Ameca.

There are 11 old silver and copper mines known in the Guachinango area, the oldest dating back to the mid-1500s — Guachinango was the first capital of Jalisco, before Guadalajara, thanks to its silver mines. The oldest, Catarina, provided silver for the Spaniards, and after independence, for the Mexican Mint in Guadalajara. Post-Revolution, American interests tried to reopen the mine, until the day unpaid workers blew up the crusher and sold it for scrap.

Most of those mines were dormant after the Mexican Revolution, except for small-scale production by private interests, but in the 1970s the government moved to make the area a National Mineral Reserve. In 1979, the Consejo de Recursos Minerales — the Mexican government geological survey, in those days also mandated to bring mineral resources into production — began programs on Catarina and another mine, Mina El Rayo. The Consejo defined a resource of 1.3 million tonnes grading 169 grams silver per tonne on Catarina.

With general economic liberalization in 1993, the government opened the area to staking; first in was Summex Mines, a Vancouver-based company that ultimately foundered on a legal battle over ownership of the Campo Morado massive sulphide project in Guerrero state. Summex did not advance the project much further than the Consejo had, and with its effective disappearance in the late 1990s, the ground came open again in early 2005. The vice-president of Soltoro’s Mexican subsidiary, geologist Chris Lloyd, staked most of the ground, which Soltoro acquired in late 2005, in its qualifying transaction to list on the TSX Venture Exchange. Later, the company inked a deal with Fury Explorations (FUR-V, FURXF-O) to acquire the remaining property in 2006 in exchange for cash, shares and a 2% net smelter return.

Soltoro now holds about 100 sq. km in the area, which covers the old producing mines and prospective geology surrounding them. The area itself is a window through the Trans-Mexican volcanic belt, the young volcanics that cover a 100-km-wide strip of Mexico from the Compostela across to Veracruz; beneath the young volcanics, there are Tertiary-age volcanic rocks of the Sierra Madre, the stuff with the juice. The Sierra Madre volcanics have been divided into a lower intermediate volcanic sequence and an upper felsic one, and the contact between the two is a zone of weakness that hosts later intrusive rocks along the length of the Sierra. Around Guachinango, it is no different; an intrusive complex with intermediate to felsic rocks intrudes the volcanic pile, with younger rhyolite domes and fracture-controlled vein systems. The picture is the classic one of precious metal veins on top of a porphyry complex, with plenty of evidence on the ground that the porphyries drove a strong hydrothermal system.

Starting in mid-2006, Soltoro mapped and prospected, drilling some of the targets identified early in the game late that year.

The old mines each sit on one or the other of two dominant fracture systems: the Ocote-Nueva Suerte structure in the south, which strikes roughly east, and the El Rayo-Catarina structure farther north, which strikes southeast and appears to have a related northeast-striking structure on two old mines, Bolas and Matachines. Drilling on Nueva Suerte intersected wide vein zones with disseminated mineralization in the wall rocks, including a 3.5-metre interval that graded 54 grams silver per tonne, with 0.3 gram gold per tonne, 5.22% lead and 2.96% zinc. There are obvious untested drill targets at depth on the structures.

At Bolas and Matachines, where the Consejo’s work in the 1980s defined a silver resource, a drill program went seven-for-seven, intersecting silver grades between 50 and 200 grams per tonne along a 600-metre strike length. Drilling there was hampered by poor ground conditions and evident breakthroughs into old and unmapped mine workings.

A third round of drilling started in June to test targets defined by a 1997 airborne magnetic and electromagnetic survey. Near the El Rayo structure, there is a 1.5-km-long geophysical anomaly — a magnetic low and a conductor.

Strong alteration in all the surface rocks underlines the possibility that a larger mineralizing system is at work farther down. But then, so does the surface vein mineralization.

Minas de Ameca

Up the road in Ameca, Southern Silver is exploring a 337-sq.-km land package, its Minas de Ameca project. That consists of four properties, one, Quila, where Southern Silver and Soltoro are in a 70-30 joint venture, another, Magistral I, where Southern Silver is earning a 65% interest from Fury Explorations, and two others, El Magistral and La Sorpresa, where Southern Silver owns the full interest, apart from a 1% net smelter return payable to the Mexican government on Magistral.

Ameca is a polymetallic district, but copper dominates; the centrepiece of historic mining was the El Magistral copper mine, worked in the late 19th century, where operators produced 150,000 tonnes of ore running 4% to 7% copper and 2 grams gold per tonne, from monzonite host rocks mineralized with chalcopyrite, bornite, and copper oxides.

Copper mineralization in the area is in late monzonite and quartz-monzonite intrusive rocks. Those cut through an andesite volcanic sequence, which is itself cut by granodiorite that is older than the monzonites. The main channelways for mineralizing solutions are breccia zones on the contact between the granodiorite and andesites. Later Trans-Mexican basalts cover part of the sequence.

At La Sorpresa, at the north end of the granodiorite, a small amount of ore grading around 2% copper was taken out in the 1990s, from a “breccia manto” — a plunging, stratiform breccia zone — that breaks out of the granodiorite into the andesites. Shallow drilling on the target turned up low grades.

A drill road driven in the east- central part of the granodiorite exposed what Southern Silver geologist Adrian Robles calls the “Surprise” breccia, another zone showing abundant, and obviously hydrothermal, epidote, chlorite and tourmaline. That alteration is typical of the late breccia-matrix and vein material that carries the mineralization, while the granodiorite shows potassic alteration everywhere, and early epidote in some breccia fragments. The fragments — 70-cm blocks were visible when The Northern Miner visited recently — are common in the Surprise breccia, and suggest fairly powerful explosive forces were at work in the subsurface.

Even with all this smoke, drill results have been pedestrian; the root zone of a breccia manto, exposed on surface, ran 1% copper with malachite staining everywhere, but a reverse-circulation drill hole to test it at shallow depth found a few narrow intervals grading around 0.25%.

Still, this is the kind of situation Southern Silver likes — there is obvious potential, and with a good reconnaissance program, the company is convinced the targets
will appear. Induced-polarization (IP) surveys showed “anomalies (that) are more or less shallow,” says Robles, having been done on short lines that didn’t allow for the wider electrode spacing that would give a better depth view. A larger-scale IP survey is scheduled.

Drilling is under way, including a 2,500-metre program testing the San Luis target on Magistral I (the joint-venture ground with Fury). Unlike the others, San Luis is primarily a gold-copper target, where a vein system on the contact between the rhyodacite and a younger monzonite carries quartz, hematite, chalcopyrite and gold. Drill holes earlier in the year returned 30 metres grading 0.39 gram gold, 1.9 grams silver and 0.17% copper, and 14.4 metres grading 0.62 gram gold, 8.8 grams silver and 0.31% copper. The results were, says Robles, “compared with what is at surface, much better for us.”

A couple of exploration projects may not look like a mining renaissance for Jalisco state, but these things always start somewhere. Very much underexplored compared to some of the other states, it is known to have a significant mineral endowment, packing more showings into its boundaries than many larger states.

“I do think this area of Mexico is overdue for serious exploration,” says Soltoro’s president Andrew Thomson.

The evidence is there; about 10 companies have a land position somewhere in Jalisco, most around Ameca and Guachinango. Fury Explorations, in addition to its interests in the Southern Silver project, is advancing work at the Guijoso property about 50 km northwest of Guachinango. Surface sampling of veins on Guijoso has returned high silver grades over narrow veins, with some gold; the best sample ran 950 grams silver and 0.2 gram gold per tonne over 0.4 metre.

Zinco Mining (ZIM-V), formerly International Croesus Ventures, has a 693-sq.-km land package immediately east of Puerto Vallarta, where it is exploring for massive base metal sulphide deposits.

So the future for Jalisco may be in something bigger than small, high-grade veins.

“I think the days of the small prospector are numbered here,” Thomson says. “Young kids are going to business school now — they don’t have any appetite for surface mining.”

It will take a lot of drill holes, but Jalisco may have the stuff to be a serious mining state.