MINING IN MEXICO — Manhattan adds to property portfolio

A feasibility study for the Moris gold deposit in Chihuahua state is expected by the end of this month.

The open-pit, heap-leach project of Manhattan Minerals (VSE) is the most advanced in the company’s portfolio of properties in northern Mexico. Indicated minable reserves are reported to be 4.3 million tons grading 0.058 oz. gold per ton in three contiguous deposits: Creston, San Luis and Eureka. The deposits were outlined by 150 diamond and reverse circulation drill holes totaling 27,000 ft.

A pre-feasibility report has estimated operating costs to be US$150 per oz. Mine life would be about eight years, with gold recoveries averaging 75%. A strip ratio of 0.64-to-1 waste-to-ore is projected. Production would amount to about 30,600 oz. in the first year and total about 191,000 oz. for the entire eight years.

Manhattan will have a 100% interest in the mine, although the property vendor will retain a 5% net smelter royalty and a 20% net profit interest after payback of all costs incurred by Manhattan (from exploration through to production).

“Assuming positive results from the feasibility study, we will be attempting to arrange financing this winter,” said Manhattan President Peter Tegart. “We estimate capital costs will be in the order of $7-8 million.” Under way is a program consisting of metallurgical work, infill drilling and possible expansion of reserves. Exploration is continuing elsewhere on the property in an effort to follow up results of previous regional exploration. The regional program led to the acquisition of an additional concession, about 3 km southwest of the main Moris deposits. This concession covers an extensive quartz vein and associated breccia system which has widespread gold mineralization.

The company recently acquired the Guitarra property, also in Chihuahua. The epithermal gold prospect covers two concessions containing widespread gold occurrences currently being hand-mined by “gambinsinos.” The land package was acquired because of its size (54 hectares) and the potential for developing an open-pit, heap-leach gold project.

Manhattan’s geologists interpret the property to represent the upper levels of an epithermal system in several breccia pipes. The company intends to map the property in detail to outline additional breccia pipe exposures, followed by diamond drilling.

Drilling occurred this summer on Manhattan’s El Promontorio

copper-gold-silver property in Sinaloa state. Work to date on this polymetallic project includes linecutting, an initial magnetometer survey, surface mapping and underground sampling on one adit. The surface program is continuing, and a 5,000-ft. diamond drill program is to begin shortly.