LATIN AMERICA SPECIAL — Swannell Minerals conducts

A preliminary US$200,000 exploration program is nearing completion on the Rio Tinto copper oxide property in the Mexican state of Chihuahua.

Operator Swannell Minerals (VSE) can earn a half interest in the 165-hectare property by spending US$5 million on exploration and carrying out a bankable feasibility study. Comprising four concessions, the Rio Tinto property is about 40 km north of the state capital, also called Chihuahua. Historic production in the early 1900s centred on the mining and smelting of high-grade copper ore, until 1915. Exploration work by Asarco in the 1950s and by the present owner, Compania Minera de Namiquipa, outlined an oxidized copper deposit containing a potential resource estimated at 10.9 million tonnes grading 0.57%.

More recently, Swannell undertook a 16-hole program of reverse-circulation drilling in an effort to assess the potential for an open-pit, heap-leach deposit. The program totalled 1,890 metres and was conducted over an 8.5-hectare portion of the property. Mineralization was encountered to an average depth of 70 metres, for an overall grade of 0.38% oxide copper and 0.43% total copper. Mineralization remains open in all directions. Two significant intersections included 32 metres of 0.88% oxide copper and 0.92% total copper for hole RC-1, and 88 metres of 0.4% oxide copper and 0.57% total copper for RC-9.

To date, underground channel sampling of a 350-metre railway tunnel, which cuts through the deposit, has returned 29 samples averaging 0.47% oxide copper and 0.53% total copper over 145 metres. In a surface area north of the target deposit, 56 continuous channel samples along the walls of the Columbia-Pedernal pits averaged 1.25% oxide copper, 1.31% total copper and 1.88% zinc.

The property consists of limestone which, in places, is metamorphosed to marble and massive granular garnet. It is overlain by rhyolite and intruded by monzonite at an approximate depth of 100 metres. The copper mineralization is hosted mainly in the garnet skarn in the form of malachite, with minor azurite and chrysocolla. Metallurgical tests indicate a minimum copper recovery of 80%.

An induced-polarization (IP) survey by Kennecott Exploration over the northern portion of the property indicates the possible presence of sulphide mineralization at depth. A drill hole positioned over the 1.5-km IP anomaly ended in 8 metres of sulphide mineralization grading 0.41% copper. Property access and associated infrastructure are deemed excellent; the city of Chihuahua is less than one hour’s drive from the site; power lines go right through the property; and the Juarez-Chihuahua main railway line and spur lie 2 km to the west.

Stanley Ford, president, says Swannell Minerals intends to prove-up tonnage. The company has 13.4 million shares outstanding and working capital of $200,000.

The Northern Miner

Volume 81 Number 4

March 27, 1995