Platosa shows expansion potential for Excellon

VANCOUVER — Excellon Resources’ (EXN-T, EXLLF-O) Platosa test mine is still flooded and operations suspended after workers unexpectedly hit a water-bearing fault. In the face of that bad news, however, the company released some strong Platosa drill results that gave its share price a gentle lift.

The Platosa test mine and exploration project are in Mexico’s Durango state. The latest drill results include some of the project’s highest grades to date, as well as additional intercepts from newly discovered zone NE-1.

Hole 468 cored 8.7 metres of semi-massive sulphides grading 481 grams silver per tonne, 5.9% lead and 13.6% zinc from 204 metres depth in manto NE-1. Excellon discovered NE-1 earlier this year and has so far defined the new zone as an irregularly shaped body with a strike length of 40 metres and a width of 30 metres, and still open. The intercept in hole 468 is the thickest from NE-1 to date.

Other NE-1 results include 4.4 metres of 425 grams silver, 4.2% lead and 1.3% zinc from 155 metres depth in hole 446 and 5.2 metres grading 542 grams silver, 10.9% lead and 15.1% zinc from 220 metres downhole.

Drilling in a new zone 150 to 200 metres northeast ofthe main Rodilla Manto produced a 5.3-metre intercept of massive and semi-massive sulphides in hole 528. The new zone, dubbed the NE Rodilla, also produced two sulphide zones separated by 30 metres in hole 533. The upper zone is 8 metres thick and comprises four massive sulphide mantos with intervening breccia; the lower hit includes a 4-metre-thick sulphiderich breccia and a 1-metre-thick massive sulphide manto. Assays are pending for both holes.

At the Rodilla Manto, hole 485 returned 1.1 metres grading 1,850 grams silver, 14.9% lead and 20.1% zinc in one of the highest-grade intercepts from the zone to date.

In addition to the numerous mineralized hits, the company has drilled 23 holes in the immediate test area that encountered the favourable host limestone unit but did not intersect significant sulphides.

Three drills remain in the test mine area and a fourth continues to test the Saltillera zone, roughly 5 km west.

Platosa comprises six mineralized mantos, some of which are connected, for 396,000 indicated tonnes grading 986 grams silver per tonne, 9% lead and 10.1% zinc, plus 72,700 inferred tonnes grading 742 grams silver, 9.1% lead and 9.7% zinc.

Excellon usually mines some 200 tonnes of high-grade ore from the carbonate replacement-type Platosa deposit. The ore is crushed onsite and then trucked to the Naica mill in Chihuahua state, operated by the Minera Maple (formerly named Fresnillo) division of Industrias Peoles (IPOAF-O, PENOLES-M).

On May 21, however, Excellon was forced to suspend mining activities at the test mine when workers hit a water-bearing formation at the 140-metre elevation during routine development of a third ventilation raise in the mine’s northwestern section. The resulting water flow exceeded the pumping capacity of the mine’s dewatering pumps and work was halted. No one was injured.

In the ensuing weeks, Excellon has worked to cement off the inflow area and has placed a second safety plug in the access drift below it. At presstime, the company had stopped the leak and begun to dewater the mine.

Excellon has maintained normal deliveries of ore from its stockpile but made its last shipment on June 5. Shipments are now suspended until operations resume.

The company has recently faced production troubles due to the grade disparity between its ore and Minera Maples’ lower-grade rock. For that reason, as well as for the clear cost savings it will achieve, Excellon recently decided to build a 350-tonne-per-day lead-zinc flotation mill at the mine; construction is expected to start early next year.

In other Excellon news, in mid-May the company closed a $10-million financing; it issued 7.7 million shares at $1.30 apiece.

News of the latest drill results boosted Excellon 4 to close at $1.28. The company has a 52-week trading range of 90-$1.90 and has 159 million shares issued.