LATIN AMERICA — Prefeasibility positive for Joutel in Cuba — Gold-silver project moves to feasibility

A resource calculation and preliminary metallurgical testing at the Zona Barita project have enabled Joutel Resources (JTL-T) to advance the Cuban property to the feasibility stage.

A resource of 5 million tonnes grading 1.6 grams gold and 5 grams silver per tonne has been outlined at the deposit, situated 20 km west of the city of Santiago in the Sierra Maestra region.

The larger Upper zone, which has a reserve of 4.4 million tonnes grading 1.2 grams gold and 5 grams silver, could be developed as an open pit with a stripping ratio of 2.06-to-1. At an annual production rate of 20,000 oz., the deposit would have a mine life of six years.

Initial metallurgical testing of the mineralized material indicated that heap leaching could recover 70% of the gold over a 45-day cycle. Cash costs are estimated at US$270 per oz. and development of such a project would cost US$6.4 million.

Under its agreement with Geominera, the Cuban state mining agency, Joutel can earn a 50% interest by committing to annual exploration budgets and paying land costs.

At the Christina prospect, also in the Sierra Maestra region, a hole drilled into a gossan zone intersected 1.6 grams gold and 0.53% copper over a core length of 26.3 metres. Most of the mineralization was held in a 2.3-metre-long section that graded 11.2 grams gold and 4.45% copper.

Joutel is awaiting results from three other holes drilled on the prospect.

Mapping in the surrounding area traced five zones of alteration, including one measuring 2.5 km long and 1 km wide, which surrounded the Christina project.

In the Camaguey area, about 160 km northwest of Sierra Maestra, Joutel has drill-tested the Vista prospect, where high gold concentrations in soils coincided with several mineralized boulders. One hole intersected 17.1 metres grading 0.5 gram gold, and contained intervals of 1 metre grading 1.43 grams and 0.6 metre grading 6.7 grams. A second hole, 300 metres away, intersected 66.6 metres grading 0.2 gram gold, including a 4-metre-long interval grading 1.3 grams.

Vista is 75 km northwest of, and along strike from, the Golden Hill deposit, which is being explored by MacDonald Mines (MMP.A-A) in a joint venture with Golden Hill Mining (GHMC-C) and Mill City Gold Mining (MIY-V). Those companies recently announced the discovery of a new mineralized structure, known as Zona Campo Santos, about 1 km northeast of the deposit.

Bulldozer trenching

Mineralization at the zone was uncovered in a bulldozer trench across a near-vertical quartz vein 20 metres wide in extremely weathered rock.

Analyses on the weathered rock revealed up to 1.4 grams gold and more than 100 grams silver. Soil geochemistry and ground geophysical surveys are planned.

Farther to the northwest, in the Santa Clara region, 250 km southeast of Havana, Joutel has drilled three holes in the Arimao prospect — a small porphyry-copper deposit where trenching last year revealed a zone of stockwork gold mineralization. That zone, which was found to have a strike length of 200 metres, yielded intersections grading 0.48% copper and 0.54 gram gold over 112.3 metres, 0.38% copper and 0.1 gram gold over 137.5 metres, and 0.33% copper and 0.1 gram gold over 80.2 metres.

At the nearby Carlota, a massive sulphide deposit which is believed to have a resource of 5 million tonnes grading 1% combined copper and zinc, Joutel drilled four holes to test for gold potential. The best intersection, however, uncovered a scant 0.4 gram gold over 19.5 metres, with 5.7 grams silver, 1.2% copper and 0.24% zinc. Joutel has no immediate plans for further work there.

Meanwhile, Teck (TEK-T) has picked up an option to buy 1 million shares of Joutel at 35 cents apiece. The Vancouver-based major can exercise another option to buy an additional 1 million shares, this time at 70 cents, until Feb. 1, 1998. Teck can also exercise a back-in right for an interest of 50% at any of Joutel’s Cuban holdings once a positive prefeasibility study is completed on any particular property. Teck’s earn-in requires it to fund a feasibility study and finance Joutel’s share of development capital.