Malbex discovers new zone, wraps up drill program

Malbex Resources (mbg-v) wrapped up its 2010/2011 drill program at the Del Carmen gold-silver project in Argentina’s San Juan province, saying it now has enough data to calculate an initial resource estimate for the Rojo Grande target by year-end.

On June 6, the company reported the last four holes of the 25-hole program, which included about 5,500 metres.  

The market responded unfavorably causing Malbex shares to lose 4% to close at 33¢ on the day, but the junior saw it shares gain 6% to close the following day at 35¢.

“We’re extremely pleased with the results from the recently completed drill program at Del Carmen Norte,” said Tim Warman, president and CEO, in an earlier press release. “We’ve outlined a significant body of shallow, oxide-hosted gold-silver mineralization at Rojo Grande, and should now have sufficient data to compile an initial resource estimate.”

Of the four holes reported, three expanded and infilled the Rojo Grande target, while the fourth, hole 53, hit a new near-surface mineralized zone on the northern flank of Cerro Amarillo, intersecting 27 metres of 0.55 gram gold per tonne and 2 grams silver per tonne.  

Warman noted this hole is exactly the discovery the company was looking for, since it’s similar to the Rojo Grande discovery. He added Malbex would follow it up with more drilling in the coming season, which is expected to start in October, after the Andean winter ends.

The best hole of the three punched into the central portion of Rojo Grande was hole 55, which cut 104 metres grading 1.96 grams gold and 25.2 grams silver, including 58 metres at 2.95 grams gold and 35 grams silver.

But, previously reported hole 52 stole the show at this year’s drill season, which ran from November 2010 to April 2011. The hole hit the longest interval to date, returning 267 metres of 2.05 grams gold and 29.3 grams silver, including 34 metres of 8.31 grams gold and 70.1 grams silver.

Other earlier reported high-grade hits include: hole 46 carrying 46 metres of 3.31 grams gold and 25.2 grams silver and 132.6 metres at 2.10 grams gold and 10.8 grams silver; hole 47 returned 17 metres of 2.72 grams gold and 71 grams silver; and hole 49 graded 82 metres of 0.71 gram gold and 9.4 grams silver and 65 metres of 0.59 gram gold and 6.2 grams silver.

With more cash in hand thanks to a recent $15-million financing the company closed in early May, where it issued 30 million units, consisting of one share and a half warrant, for 50¢ apiece, it is planning a larger drill program at Del Carmen for October.

The aim of the program is to expand Rojo Grande, which remains open to the southwest and at depth, and to also drill other targets on the 9-sq.-km Del Carmen Norte alteration system, said Warman, adding the company would also explore the Del Carmen Sur alteration system.