Creston Moly’s bet on El Creston paying off

VANCOUVER — With complete results now available for the latest drill program at El Creston, it’s becoming clear that Creston Moly (CMS-V, CMSJF-O) has its hands on one of the highest-grade molybdenum deposits around.

Creston’s work at the project in Sonora state, Mexico, has established that breccia-hosted mineralization sits near surface, extends over a strike length of more than 400 metres, and consistently grades higher than 0.1% molybdenum. Moreover, the eastern section of the Main zone hosts higher grades.

Results from the recently completed 52-hole infill drilling program show long, well-mineralized intercepts.

Starting at the southern edge of the deposit, hole 49 cut 103 metres grading 0.07% molybdenum from 51 metres depth followed by 97 metres grading 0.1% moly from 170 metres down-hole.

In the southeast corner, hole 51 — drilled vertically to check for shallow mineralization — returned a high-grade hit: 25 metres grading 0.39% moly starting 10 metres downhole, including 3 metres of 3.07% molybdenum.

Probing the eastern extension of the zone, hole 48 cut 36 metres grading 0.2% moly from surface, immediately followed by 148 metres averaging 0.11% molybdenum. Moving slightly north, hole 46 returned a lengthy intercept: 242 metres grading 0.11% moly, starting 59 metres below surface.

Slightly west of the centre of the zone, hole 44 returned 200 metres grading 0.1% moly and 0.12% copper underneath a weaker, 103-metre interval starting at surface and grading 0.05% molybdenum. Nearby, hole 33 cored no less than 297 metres grading 0.11% moly from 79 metres depth and hole 36 cut 51 metres of 0.09% moly followed by 121 metres of 0.1% molybdenum and then, after a 50-metre gap, 69 metres also averaging 0.1%.

Near the zone’s northern border, hole 32 hit 41 metres of 0.09% moly, then 252 metres grading 0.12% molybdenum. Some 300 metres east, hole 41 hit 210 metres grading 0.16% molybdenum from 98 metres depth.

Molybdenum mineralization at El Creston occurs as disseminated molybdenite in quartz stockworks and in the matrix of breccia zones associated with quartz monzonite porphyry. The El Creston deposit forms a topographic high, making for a very low modelled strip ratio of less than 1:1 for an open-pit operation.

With the infill program at the Main zone complete, Creston Moly has moved its drill rig to the Red Hill zone. Company geologists believe Red Hill is a faulted extension of the deposit, as it sits immediately below the low-angle, north-dipping Creston fault that defines the Main zone’s lower extension.

The rig is now drilling the fourth hole of a widely spaced program at Red Hill. While no results have been received to date, Creston Moly reports that the second hole of the program intersected extensively altered and mineralized high-level porphyries to depths of 500 metres. Mineralized porphyries of this type are thought to be the roots of the mineralized system that at higher levels is characterized by breccia and stockwork mineralization. Creston Moly’s president and CEO Jonathan George called the core “very encouraging.”

While the company probes Red Hill, it plans to calculate a new resource estimate for the project. A January estimate, based on work by previous operators, calculated El Creston held 92.9 million indicate tonnes grading 0.083% molybdenum and 84.2 million inferred tonnes averaging 0.076% moly. Creston Moly aims to complete the new calculation by September.

Interestingly, Creston Moly does not retain half its core, but sends the entire core for assaying. The rationale behind the decision is twofold. First, in places the molybdenite mineralization at El Creston occurs as loosely bound coarse flakes and clusters, which are easily lost in core handling, sawing, and washing. Second, there is evidence of a nugget effect in part of the deposit; assaying the entire core maximizes sample volume, thereby minimizing any nugget effect.

The El Creston project was the subject of a previous development plan by a joint venture of Amax, now part of Freeport-McMoRan Copper & Gold (FCX-N), and Mexican mining house Industrias Peoles (IPOAF-O, PENOLES-M) in the 1970s and ’80s that included prefeasibility, bulk sampling and metallurgical programs.

After closing a $40-million bought-deal private placement, Creston Moly acquired the project last year for US$20.15 million, issuing US$10 million in units (comprised of 15.9 million shares and 7.9 million warrants) and issuing 600,000 stock options to the vendors, which also retain a 3% net profits interest.

Creston Moly, known until October 2007 as Georgia Ventures, lost 1.5 on the latest set of drill results to close at 35. The company has a 52-week trading range of 28-58 and has 121 million shares issued.