Chesapeake Gold (CKG) has deemed the Metates gold-silver project in Durango state, Mexico to have measured and indicated resources of 14.7 million oz. gold in the Main and North zones.
Resources based on more than 703,000 tonnes grading 0.65 gram gold per tonne, 17.5 grams silver and 0.17% zinc per tonne. Contained silver is estimated at 396,000 oz. while zinc is thought to total 2.6 million lbs.
The project also has inferred resources of 74,000 tonnes grading 0.8 gram gold per tonne, 16 grams silver and 0.13% zinc.
The resource was passed on an open pit stretching 2.5 km long in a north-south direction, 1.7 km wide, and extending 600 metres deep.
The company says the Main zone is still open along strike to the southeast while the North zone is open in both strike direction – northwest and southeast. A new anomaly similar to the Main zone was identified in an IP geophysical survey recently, located about 200 metres outside the southeast limit of the Main zone’s known mineralization.
Up next, Chesapeake is working on a preliminary economic assessment for the Metates project. The company plans to do more than 60 different flotation tests on two different master composites.
The resource estimate was estimated using a US$750 per oz. gold price within an optimized pit shell using a cut off grade of 0.5 gram gold per tonne. The company is looking at processing the ore via grinding, production of a flotation concentrate and roasting of the concentrate to produce a calcine which can be treated by cyanidation to recover gold and silver. Costs were assumed using a mining rate of 60,000 tonnes of ore per day. Operating costs were US$1.15 per tonne for mining, US$7.75 per tonne for milling and treatment and US50 per tonne of ore for general and administrative costs.
The company drilled 171 holes totaling more than 63,000 metres of drilling.
Chesapeake shares fell 7 today to $4.80 apiece on a trading volume of 118,000 shares.
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