Mag cuts narrow vein at depth (August 19, 2003)

Vancouver — Initial results from an ongoing, 3,500-metre drill program indicate narrow intervals of high-grade silver-gold values between 400 and 500 metres below surface on the Juanicipio claims in Mexico’s Zecatecas state.

Newly minted Mag Silver (MAG-V) cut the veins while testing for extensions of the prolific mineralized zones on the neighbouring Fresnillo mine property.

“We started with a concept, based on geology, geochemistry and geophysics, to find extensions of the world’s premier silver mine into our adjoining Juanicipio property,” says President George Young, “and we have confirmed it.”

The Juanicipio property lies 5 km from the principal production headframe of the Fresnillo mine, and less than 3 km from the westernmost underground workings. Fresnillo, which produces more than 31 million oz. silver per year, is operated by the Mexican company Industrias Penoles.

Fresnillo has a production history dating back to 1560. Overall output plus reserves for the operation are pegged at 800 million oz. silver, and half of the mine’s historic production occurred after 1976, when the high-grade “Santo Nino”-style veins were discovered. Over the past six years, Penoles has been tracing veins westward from the historic mining centre towards the Juanicipio property. Based on exploration results, the company has begun ramping up production to more than 50 million oz. per year by mining the San Carlos vein, the biggest of its new western-vein discoveries.

Poleo

Mag’s first hole on the property targeted the Poleo trend, the northernmost of several parallel veins adjacent to the Fresnillo mine. This hole returned 10.9 grams gold and 200 grams silver per tonne over 30 cm, about 500 metres below surface. Core recovery for the 3-metre section was 22%. Mineralization consisted of a 30-cm section of intact vein wall followed by a 1.5-metre-wide void in the vein.

Pyrargyrite-bearing quartz-vein fragments recovered from drilling rubble on the footwall of the vein were included in the sample. The intact vein margin consists of acanthite and sphalerite-bearing banded quartz showing brecciation and recementation textures indicating at least three stages of mineralization.

The pyrargyrite-bearing rubble fragments show well-formed quartz crystals, locally studded by tiny pyrargyrite crystals. According to Mag, these features are similar to those of Fresnillo’s Santo Nino-style veins. A wedge-off of Hole 1, dubbed hole 1A, cut a banded quartz-sulphide vein carrying 670 grams silver and 1.2 grams gold over 0.9 metre, about 14 metres below the other intercept.

Hole 2 tested a separate, near-parallel structure coincident with a strong geophysical anomaly on trend with Penoles’ exploration. The intersection of mineralized breccias and veins within the geophysical anomaly resulted in the hole’s being extended to a depth of 900 metres. Despite cutting pyrargyrite and acanthite-bearing veins similar to Fresnillo’s San Carlos vein, the hole returned a high value of 2.4 grams gold and 66 grams silver over 0.4 metre at 874 metres down-hole.

Hole 3 was abandoned after cutting a 3.5-metre-wide crystal-lined void some 30 metres before reaching its target depth. A small amount of mixed vein and wallrock rubble was recovered from the zone, with assays pending.

Hole 4 is now testing the Poleo Sur trend, which is parallel to, and 400 metres south of, the Poleo trend.

“The Fresnillo system is much larger than historically thought,” says Young. “The results opens up the potential along strike on these two structures as well as on at least five other similar parallel target structures, each with more than two to three kilometres of mapped strike length.”

The Juanicipio project was last worked by Idaho-based Sunshine Mining & Refining (SSMRE-O), in 2000.