Maracote focuses on Halley property

Junior Maracote International Resources (MCE-V) will begin a second phase of drilling on its Halley gold-silver property in south-central Peru.

The 3,000-metre diamond drill program will test for gold mineralization along the 2.5-km-long Quilca trend, north of previously drilled ground. The work will focus on a 600-by-600-metre area where sampling has returned values averaging 2 grams gold per tonne.

In total, 340 samples were collected from the site, and results from 188 samples have been received to date. Nine chip samples from one historical adit averaged 3.5 grams gold and 56.8 grams silver per tonne over 22 metres. Another 20 samples, taken from a different adit in the same area, returned 3 grams gold and 6 grams silver over a 40-metre interval.

In related news, the company has announced that certain directors of Maracote have arranged to sell 4 million shares at 30 cents per share. The sale will be used to fund a private placement worth $1.2 million. Proceeds will be put towards the next phase of exploration at the Halley and Leoncocha properties. Once the financing is completed, Maracote will have working capital of $2.3 million plus 28 million shares fully diluted.

Previous drilling on the Quilca breccia identified encouraging gold and silver mineralization in four of five holes. Assays from previously reported hole 3 returned 68 metres of 2.1 grams gold and 7.5 grams silver, including a 15.3-metre section that graded 4.1 grams gold and 31.9 grams silver.

Maracote can earn a 65% interest in both the Halley and the nearby Leoncocha properties from Ulysses International Resources (URI-V) in return for US$280,000 and maintenance of the underlying Ulysses option. Ulysses is earning an 85% interest in the two properties by paying the original vendors US$1.4 million and spending US$5 million in exploration and development before July 2000. Once these obligations are fulfilled, the Halley and Leoncocha properties will be owned 65% by Maracote, 20% by Ulysses and 15% by the original vendors.

Gold and silver mineralization is hosted in a structurally complex sedimentary package that is dominantly composed of quartzite. The quartzite exhibits extensive brecciation with associated silicification, sericitization and pyritization.

Maracote’s main target is the Quilca breccia, one of a series of extensive breccia bodies that trend in a northeasterly direction along a 600-metre linear structural zone. To date, six breccia zones have been discovered, in addition to the Quilca breccia.