Extorre finds high-grade zone at Cerro Morro

A new high-grade discovery at Extorre Gold Mines‘ (XG-T, XG-X) Cerro Morro gold project in southern Argentina has propelled its share price to an all-time high.

The company drilled the new Zoe discovery, which is 2.5 km east of Escondida’s Martina shoot. Extorre is now interpreting the Zoe target as a roughly 2-km-long, east-west dilation zone with 650 metres already defined.

Stand-out hole 1204 hit 4.8 metres grading 64.6 grams gold per tonne and 7,530 grams silver per tonne from 89 metres depth, and included a 1.4-metre section carrying 227.3 grams gold and 25,428 grams silver.

Forty metres east of hole 1204, discovery hole 1191 returned 2.8 metres of 2.4 grams gold and 316 grams silver from 121 metres depth, and 40 metres south of that, hole 1196 cut 1.3 metres averaging 13.4 grams gold and 1,750 grams silver from 139 metres.

Only the three assay results were released, while Extorre is pushing the lab to have the remaining 18 holes from Zoe analyzed as quickly as possible, prioritizing them ahead of drill core from its other projects.

Extorre started exploring the Zoe target based on a surface outcrop of only 0.34 gram gold and 115 grams silver, which was enough for the company to describe it as a blind discovery. Adding to the company’s excitement, its visual inspection of the core suggests that drilling has entered the mineralized zone and it continues at depth.

Extorre’s share price jumped $1.30 or 18% to close at $8.53 on the news, after hitting an all-time high of $8.75 in mid-day trading.

The company reports that mineralization appears to be typical of the known Escondida structure. Extorre saw silver mineral acanthite in many cores and five showed electrum, while base metals and pyrite are accessory minerals.

Extorre has two drills targeting the Zoe area, one drilling 160-metre step-outs and the other 80-metre centres. The company has two other drills at Cerro Morro targeting other veins.

In addition to exploring Cerro Morro, Extorre has two drills turning at Cerro Puntudo, 220 km west. The project is south of Coeur d’Alene Mines (CDM-T, CDE-N) and Mirasol Resources‘ (MRZ-V) Joaquin silver project. 

Extorre has results pending on its Union Domes gold project 18 km south of Cerro Morro, and released results from its Falcon gold-silver project, 80 km northwest, in February.

For Cerro Morro, Extorre expects to receive environmental approvals soon, and complete a prefeasibility study in June and a resource update by the fall.

The current resource for Escondida is 590,000 indicated tonnes grading 18.9 grams gold and 805 grams silver. The total inferred resource, incorporating several surrounding zones, is 1.97 million tonnes of 3 grams gold and 190 grams silver.  

The company is spending roughly $2.5 million a month with six rigs operating and has about $33 million in the bank.

Exeter Resource (XT-T, XRA-X) spun out Extorre Gold Mines in March 2010 as an Argentina-focused play, allowing Exeter to concentrate on its sizable Caspiche gold-copper project in northern Chile.