Cinco de Mayo doesn’t disappoint for MAG Silver

Drill results from Cinco de Mayo, 190 km north of the city of Chihuahua in Mexico, indicate continuous mineralization over a 400-metre dip length with mineralization remaining open down dip and along strike, MAG Silver (MAG-T, MVG-X) reports.

The best hole (390) returned 274 grams silver per tonne, 5.5% lead and 17.2% zinc over 8.08 metres including 1.63 metres grading 778 grams silver, 14.9% lead and 18.2% zinc. The intercept is the sulphide portion of a 14.1 metre thick manto zone, the company says, where the top six metres is partially to completely oxidized and leached sulphide.

The remaining holes all cut massive sulphides ranging from 1.5 metres to 5.25 metres in thickness; hole 385 returned 5 metres of 102 grams silver, 3.3% lead and 13.2% zinc, and hole 386 cut 3.13 metres of 198 grams silver, 5.7% lead and 7.8% zinc.

This series of holes are the first full cross-section across the Bridge Zone between the Jose Manto and the Cinco Ridge and show manto width, thickness and composition comparable to the well constrained body of the Jose Manto, the company outlined in a news release.

The ten holes were drilled on a section to test the up- and down-dip continuity of hole 380—the best of seven massive sulphide manto intercepts drilled late in 2011—and the results demonstrate the lateral and vertical continuity of the mineralization, the company says.

Currently two rigs are drilling progressive fences of holes along the Bridge Zone and the company is now drilling a fence of holes across hole 377, which last November reported assays of 5.25 metres grading 280 grams silver, 6.1% lead and 6.2% zinc.

MAG Silver’s 100%-owned Cinco de Mayo property is one of three Carbonate Replacement Deposits the company is exploring in Mexico. CRDs have been mined for more than 400 years, the company says, and represent about 40% of Mexico’s 10 billion ounce historic silver production.

CRDs are characterized by massive to semi-massive silver-lead-zinc sulphide intrusions, MAG Silver explains on its website. The metal-rich intrusions replace the carbonate host rocks (limestone) and occur along major regional structures. Cinco de Mayo lies along the same northwest trending regional structure that hosts several of the largest CRDs in Mexico.

CRDs are receiving renewed attention these days because of higher base and precious metal prices, the company says, and because modern geoscience makes detection of sulphide systems at depth more possible than in the past. (MAG Silver discovered Cinco de Mayo in 2006 by “blind drilling” after extensive geological, geochemical, biogeochemical and geophysicial studies. About 75% of the deposit is covered with alluvium with virtually no outcrop to guide exploration and all of the mineralisation  intersected was initially defined as buried geophysical and geochemical anomalies consistent with the company’s exploration model.)

MAG Silver notes that CRDs have the potential for large tonnage and high grades as well as substantial base metal credits to the precious metal resource. It also points out that sulphide replacement in carbonates (limestone) mitigate oxidation and is therefore more metallurgically amenable and environmentally benign.

At presstime the company was trading at $10.04 within a 52-week range of $6.17-14.15. It has about 55.7 million shares outstanding.