Great Panther sets sights on Km 66 prospect

Vancouver – A letter-of-intent agreement paves the way for Great Panther Resources (GPR-V) to acquire the Km 66 silver-lead-zinc-gold project in eastern Durango State, Mexico. The bulk-tonnage project is bisected by a paved highway that continues for 100 km to the Torreon smelter operated by Mexican mining company Penoles.

Great Panther notes that mineralization at KM 66 is associated with hydrothermal breccias and stockworks related to a cluster of rhyolite domes, and shows “strong similarities” to the Real de Angeles mining district in nearby Zacatecas State.

The Km 66 property was explored in the late 1990s by Coeur d’Alene Mines (CDM-T, CDE-N), which drilled 81 reverse circulation holes, 21 diamond drill holes, and 422 surface channel samples. This work led to a preliminary resource estimate of 25 million tonnes averaging 50 grams silver and 0.1 gram gold per tonne, 0.7% lead and 1.3% zinc. Great Panther cautions that additional work is needed to upgrade this historic resource estimate to meet National Instrument 43-101 reporting standards.

Great Panther can acquire 100% of the Km 66 project by making six staged cash payments and share issuances totaling US$3 million and 500,000 shares over a four-year period to the property owners. The company believes the project complements its existing portfolio of Mexican projects, including the producing Topia silver-lead-zinc mine in Durango State, and the Guanajuato gold-silver mine complex being readied for production in Guanajuato.

Topia is a former underground producer that was revived by the company in late 2005, and is on track to reach an initial production target of 200 tonnes per day by mid-year. An exploration program is also under way to define resources compliant with NI 43-101 reporting standards.

Guanajuato is also a former producer, complete with a newly refurbished 1,200-tonne-per-day plant that is now being commissioned. As this work progresses, an underground drilling program is being carried out to bring resources to NI 43-101 reporting standards. The Guanajuato district is Mexico’s third largest silver producer, with historic production estimated at 1.2 billion oz. silver and 4.5 million oz. gold. Great Panther’s mine project covers an estimated 4 km strike length in the core of the historic mining camp.