Malbex climbs as new zone is defined

All it took was the results from one drill hole and Malbex Resources‘ (MBG-V) shares started running in the right direction. 

The company’s shares were up 24% or 14¢ to 73¢ in Toronto on March 25, with 3.5 million shares traded.

The fuss was caused by high-grade results from the Rojo Grande target on its Del Carmen gold-silver project in San Juan province, Argentina.

Those results were highlighted by hole 46 assaying 46 metres grading 3.31 grams gold per tonne and 25.2 grams silver and 132.6 metres of 2.10 grams gold and 10.8 grams silver.

The hole was drilled 80 metres southeast of hole 42, which retur-ned 103 metres at 2.84 grams gold.

The results mean Malbex has expanded the higher-grade mineralization recently discovered on Rojo Grande’s silicified ledge.

Malbex says the high-grade zones occur near a dacite intrusion and mineralization is typically concentrated in the silicified rocks but is also in powdery quartz-alunite altered rocks.

The recent drilling has also extended the depth of oxidation at Rojo Grande from surface to at least 220 metres.

That news is made more significant by the preliminary metallurgical testing the company has conducted, which shows the potential for heap-leach cyanidation treatment with gold recoveries averaging 76.5%.

“Rojo Grande is delivering everything we could ask for – consistent gold-silver mineralization with higher-grade, near-surface zones, generally shallow to non-existent overburden, encouraging metallurgy, and the structure remains open at depth and to the southwest,” Tim Warman, Malbex’s president and chief executive, said in a statement.

The Toronto-based company is still waiting for the results from hole 49, which it says should improve its understanding of the geometry of the higher-grade zones discovered in holes 42 and 46.

After that, it will look to infill the area before the end of the current drilling season.

The company has so far reported the results from 12 holes totaling 2,264 metres.

While one drill rig is still delineating the Rojo Grande target, another is testing anomalies to the southwest of Rojo Grande at Cerro Amarillo.

Drilling at Cerro Amarillo is proving difficult for the company however, as the drill is set to make its fourth attempt to reach the target depth of 500 metres.

The Del Carmen concession package covers 147 sq. km and is located near the southern end of the El Indio gold belt.

Malbex holds three exploration projects on the belt, which hosts more than 35 million oz. gold in past production and current reserves, including Barrick Gold‘s (ABX-T, ABX-N) Veladero and Pascua-Lama gold deposits.