High-grade gold sweetens Mulatos

Vancouver Six reverse-circulation drill holes have intersected the highest concentrations of gold mineralization found to date at the greater Mulatos deposit in Mexico’s Sonora state. The open-pit project owned by Alamos Gold (AGI-T) poured its first gold this summer and is poised to achieve commercial production by year-end.

The best of six holes recently drilled in the Escondida Hanging Wall zone intersected 28.97 metres grading 70.96 grams gold per tonne, including 9.14 metres of 198.9 grams gold. The zone is situated 500 metres northeast of the Estrella pit, currently being mined.

The five other holes all intersected near-surface mineralization. Highlights include: 10.67 metres of 12.29 grams gold; 13.72 metres of 14.98 grams gold; 12.2 metres of 36.92 grams gold; 19.81 metres of 11.86 grams gold; and 18.29 metres of 3.89 grams.

Alamos notes that the high-grade zone is a “previously unrecognized style of mineralization” consisting of coarse-grained native gold. The mineralization is different from that observed in the Estrella pit, which hosts reserves of 36.4 million tonnes grading 1.64 grams gold, or about 1.9 million contained oz. Current reserves are within a measured and indicated resource of 62.3 million tonnes grading 1.5 grams gold that includes several nearby deposits.

The newly constructed Mulatos mine is expected to produce up to 150,000 oz. gold per year over at least a 10-year mine life. The mine was built at a cost of about U$78 million.

Assay results are expected shortly from seven additional holes that intersected visible gold at the Escondida Hanging Wall zone. This brings to 20 the number of holes drilled to test the zone, for a total of 1,380 metres.

The high-grade stratiform zone occurs at the hanging-wall to the lower-grade portion of the Escondida deposit. The company says the discovery suggests that the Escondida deposit is the faulted extension of the historic high-grade Mina Vieja deposit, which was responsible for the bulk of previous gold production at Mulatos.

Alamos expects the zone will boost the project’s overall resources as the high-grade mineralization was intersected in areas that are not part of the existing block [resource] model. Step-out drilling is planned to test the extent of the zone.