Cinco de Mayo doesn’t disappoint for MAG Silver

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

Hole 390 returned 274 grams silver per tonne, 5.5% lead and 17.2% zinc over 8 metres, including 2 metres grading 778 grams silver, 14.9% lead and 18.2% zinc. The intercept is the sulphide portion of a 14-metre-thick manto zone, the company says. The top 6 metres is comprised of partially to completely oxidized and leached sulphide.

The remaining holes cut massive sulphides ranging from 2 metres to 5 metres in thickness. Hole 385 returned 5 metres of 102 grams silver, 3.3% lead and 13.2% zinc and hole 386 cut 3 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. They show manto width, thickness and composition comparable to the well-constrained Jose manto body, the company outlines in a news release. 

The 10 holes were drilled on a section to test updip and downdip continuity of hole 380 — the best of seven massive-sulphide manto intercepts drilled late in 2011 — and the results demonstrate the mineralization’s lateral and vertical continuity, the company says.

Two rigs are drilling progressive fences of holes along the Bridge zone, and the company is drilling a fence of holes across hole 377, which last November reported 5-metre assays grading 280 grams silver, 6.1% lead and 6.2% zinc. 

MAG Silver’s fully owned Cinco de Mayo property is one of the three carbonate replacement deposits (CRDs) the company is exploring in Mexico. CRDs have been mined for more than 400 years, the company says, and represent 40% of Mexico’s 10 billion oz., historic silver production. 

CRDs contain massive to semi-massive silver-lead-zinc sulphide intrusions, MAG Silver explains. The metal-rich intrusions replace the carbonate limestone host rocks and occur along major regional structures. Cinco de Mayo lies along the same northwest-trending structure that hosts some of Mexico’s largest CRDs.

CRDs are getting more attention owing to higher metal prices, the company says, and because modern geoscience makes sulphide system detection at depth easier 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 mineralization 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 limestone carbonates mitigate oxidation, and is therefore metallurgically amenable and environmentally benign.

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