Soltoro hits more high-grade silver in new zone

Soltoro (SOL-V) has released several high-grade silver hits from the newly discovered Soledad zone at its El Rayo silver project in central Mexico, one week after reporting a bulk-tonnage resource estimate on the project.

The latest results from the wholly owned, 100-sq.-km project in Guachinango, Jalisco state, come from the east-west trending Soledad structure, which was not included in the latest resource update. So far, Soltoro has intersected the new structure over a strike length of 550 metres, and it remains open along strike and at depth.

There are no outcrops of the Soledad zone. It was discovered through a trenching program in flat farm country where there are a few small, historic underground workings.

“It’s another one of those ‘sucker zones,’ like Hemlo,” Soltoro advisor Terrence Bottrill says. “Between us, we must have driven past this thing a thousand times without realizing it was right there on the side of the road.”

Drill hole 66 returned 44 metres grading 222 grams silver per tonne from 19 metres downhole. Hole 68 also cut 44 metres, but graded 300 grams silver from 51 metres downhole. Hole 69 hit 54 metres averaging 115 grams silver from 67 metres depth, and hole 73 intersected 34 metres grading 198 grams silver from 36 metres.

Intersections included several short, high-grade hits. One metre carried 2,910 grams silver and 1.2 metres averaging 1,170 grams silver, which was cut to 1,000 grams silver. The first drill results on Soledad, released on April 20, included 7 metres grading 1,010 grams silver.

Soltoro had been using one drill rig to test the structure along strike, and a second to test its depth potential.

The Soledad structure is perpendicular to the south end of the northeast-trending Las Bolas deposit. Soltoro’s recent geological mapping of the area indicates that Soledad lies within a distinct zone of structural deformation and quartz vein brecciation. The Las Bolas mineralized zone, consisting of a tabular body of silver-bearing hematite-quartz vein breccia 40 metres thick, is thought to extend into the Highway zone offset to the east along a west-northwest-trending fault. These two zones were the subject of the recent resource estimate.

Combined, the Las Bolas and Highway zones contain 33.6 million measured and indicated tonnes grading 54 grams silver for 58.3 million contained oz. silver. The inferred resource, encompassing only the Highway zone, stands at 200,000 tonnes grading 44.3 grams silver.

Soltoro has completed 30,000 metres of drilling at El Rayo, divided about equally between diamond and reverse-circulation drilling, and has spent $6.4 million exploring the project.

“So we’re drilling for less than 8 cents an ounce,” Andrew Thomson, Soltoro’s president and CEO, says. “It doesn’t get much cheaper than that.”

There are two types of targets on the El Rayo property: the bulk-tonnage Highway-Las Bolas-type targets, and the narrow, high-grade Catarina-Soledad-type targets.

“We’re up to about 3.5 kilometres of mineralized structures, so we’re getting up there,” Thomson says.

One pleasant surprise for Soltoro at the Las Bolas structure has been the discovery that the hanging wall bears significant disseminated silver. Earlier work focused on sampling mineralization from the contact of the hanging and foot walls, and much of the material from the hanging wall was not assayed or properly stored. This new realization of the hanging wall’s silver potential gives encouragement that Las Bolas’s stripping ratio could be lower than first envisaged.

A second positive trend to emerge at Las Bolas is that the mineralized zone is seen to widen with depth wherever it’s drilled.

“It’s kind of exciting,” Thomson says of the El Rayo project. “It’s come a long way in the last year and a half, and now we’re tying it all together, and it’s looking open-pittable. It’s not world-class yet, but it certainly looks like it could hit the 100-million-ounce figure.”

Another change at the company is the arrival earlier this year of Steven Priesmeyer as vice-president of exploration, to guide the work at El Rayo.

“Having just spent the last few years in the high mountains in Sinaloa, I can tell you this is a pretty safe place,” Priesmeyer says. “Guadalajara, too. These are places where you can live and work without getting molested by the local bad guys.”

In mid-July, Soltoro struck a deal with Coeur d’Alene Mines (CDE-N, CDM-T) to have the silver major buy in a private placement 4.5 million Soltoro shares at $1 per share, for proceeds of $4.5 million. 

With the deal now closed, Soltoro has about $8.5 million in cash and no debt, and 54.1 million shares outstanding.

Soltoro is also drilling 2,000 metres on its 14.2-sq.-km Chinipas gold property in Mexico’s Chihuahua state. The company reports that gold mineralization at the project occurs in sheeted quartz-tourmaline-pyrite veins, and veinlets hosted by a strongly fractured quartz-feldspar porphyry.

“El Rayo is still ninety-five percent of our focus right now,” Thomson says.

Soltoro’s share price was up 6¢ to 88¢ on the latest drill results, and traded at $1.20 following the Coeur d’Alene news. The company has a 52-week share price range between 17¢ and $1.29.