International Minerals weighs San Luis (December 12, 2005)

International Minerals (IMZ-T) has pegged the recently discovered San Luis vein system on the Rio Blanco epithermal gold-silver project in southern Ecuador with an initial in-house resource estimate.

Based on 20 widely spaced holes totalling 2,695 metres, the series of narrow, high-grade veins are estimated to contain inferred resources totalling 125,000 tonnes grading 24 grams gold and 152 grams silver per tonne, for 95,000 contained ounces of gold and 611,000 oz. of silver. The estimate caps individual gold values at 50 grams gold.

When grades are left uncut, the resource climbs to 125,000 tonnes running 35 grams gold and 152 grams silver, for 140,000 oz. gold and 611,000 oz. silver.

The San Luis veins are represented at surface by a 500-metre-by-880-metre area of clay-altered tuffs exhibiting anomalous gold, arsenic, antimony, and mercury.

Preliminary bottle-roll cyanidation tests on drill samples indicate gold recoveries in the 90% range and silver recoveries in the 70% range.

The San Luis veins are situated immediately north of, and are roughly parallel to, the principal east-northeast trending Alejandra vein structure. Measured and indicated resources there total 2 million tonnes at 8.9 grams gold and 68 grams silver, for 592,000 contained ounces of gold and 4.5 million oz. silver. The estimate employs a cutoff grade of 3 grams gold.

A final feasibility study of the Alejandra veins by Micon International is slated to wrap up early next year. The study will not include the results from San Luis. International Minerals expects to receive approval for its environmental impact statement by mid-2006; production could conceivably follow by late 2007, subject to financing.

Meanwhile, the company continues with infill and definition drilling aimed at upgrading San Luis’ resource to the measured and indicated category. Thereafter, the feasibility study will be updated. Ultimately, the company expects that the higher-grade resources at San Luis would be mined in the first year of operation at Rio Blanco.

The Rio Blanco project is centred on an extensive, low-sulphidation epithermal gold-silver system striking some 4 km. The system stretches up to 1.2 km in width and over vertical distances of about 1,000 metres. Gold and silver mineralization occur in veins, silicified zones and breccias hosted by volcanics and intrusive bodies.