Rio Narcea drills Salave

Shares Rio Narcea Gold Mines (RNG-T) jumped 17, or 6.6%, to $2.74 in early afternoon trading in Toronto on Sept. 17, after the company tabled results from the first 20 infill drill holes on the Salave gold project in northern Spain.

The company says the holes have confirmed earlier drill results, and indicate the potential for extensions of the deposit at depth and to the west.

Hole no. 2 cut a zone of gold mineralization beneath the deposit’s main zone at a down hole depth of 204.6 meters. It yielded 40 meters grading 8.6 grams gold per tonne; the final 1.35 metres of the hole ran 46.8 grams gold. Other deeper intersections also include:

• Hole 9 — 4.6 metres (beginning 256.5 metres down hole) running 30.7 grams gold;
• Hole 10 — 23.9 metres (from 239.5 m) averaging 18.5 grams gold;
• Hole 16 — 34.7 metres (from 243.8 m) of 8 grams gold; and
• Hole GTO1 — 14.5 metres (from 330.7 m) grading 8 grams gold.

The mineralized section in hole GT01, which was sunk as a geotechnical hole, was encountered at a vertical depth of about 250 metres. The hole was collared some 65 metres west of previous drilling.

The remaining holes generally returned between 1 and 10 grams golds over widths of 1-50 metres, and at depths of generally less than 200 metres. A single hole sunk on the La Muria target, about 2 km to the south of Salave, failed to return any significant mineralization.

The ongoing, 15,000-metre infill-drilling program is designed to close the hole spacing on Salave’s main zone to 25 metres. The company currently has four drill rigs running on the property in anticipation of completing a feasibility study in mid-2005. The study will also employ detailed surface mapping and some 20,000 metres worth of re-logged core from previous operators. An independent resource estimate, compliant with National Instrument 43-101, will be filed at the end of September.

Between 1970 and 1997, Charter Consolidated Mining, Anglo American (AAUK-Q), Newmont Mining (NEM-N) and most recently Lyndex Explorations tested Salave with some 35,000 metres of drilling in 176 holes.

Drilling on the high-grade zone was highlighted by 58.5 metres grading 8.2 grams gold per tonne, 41.7 metres averaging 8.6 grams gold, 12 metres running 20 grams gold, and 22 metres of 6.6 grams gold. The drilling resulted in a resource projections ranging from 10 million to 20 million tonnes grading between 3 and 5 grams gold per tonne. Rio Narcea says the estimates do not conform to National Instrument 43-101 standards.

Salave is an intrusive-related, disseminated deposit hosted in granodiorite below a shallow-dipping, altered but unmineralized roof pendant of quartzites and siltstones. The mineralization is refractory, with the sulphides mainly consisting of pyrite, arsenopyrite and minor molybdenite, with lesser amounts of sphalerite, stibnite and chalcopyrite.

A preliminary metallurgical scoping study by Ausenco confirms that the refractory ore is amenable to treatment by bio-oxidation, pressure oxidation or heap bioleaching. A composite metallurgical sample is currently being prepared for testing. Permitting and hydrological work are also underway.