Shahuindo suit heads to Lima (November 17, 2003)

Peru’s Supreme Court has ruled a lower court judge to be legally incompetent, and has voided a previous decision favouring the plaintiff in a legal battle over the Shahuindo gold property, reports Sulliden Exploration (SUE-T).

The Supreme Court also said that arguments as to the legal title to the property would take place in Lima, where Sulliden’s transfer of title to the property was formalized last November.

At that time, Sulliden agreed to acquire the property from Compania Minera Algamarca for US$4.13 million in six instalments. By May 6, Sulliden had paid US$830,00 under the first three scheduled payments. The final four instalments bear interest at an annual rate of 5%.

Subsequently, Algamarca claimed that the agreement was invalid and commenced legal action. Sulliden says Algamarca’s claims, which dispute its own act of entering into the agreement, are without legal merit.

Before its takeover by Grupo Mexico in 1999, Asarco outlined 29.4 million tonnes of oxide material running 0.88 grams gold plus 16.2 grams silver per tonne (T.N.M., Sep.1-7/03)..

In mid-July, Socrate Capital acquired a 30% stake in return for US$1.5 million.

Earlier this month, some 90-line-km of geochemical soil sampling on 50-metre centres turned up some new target areas with elevated gold concentrations.

The survey identified soils with gold concentrations exceeding 200 parts per billion (0.2 grams per tonne) immediately overlying known mineralization at the San Jose surface gold showing. The result confirmed the presence of a gold dispersion halo in soils above the Shahuindo mineralization.

That anomalous zone extends about 300 metres north of the defined area of the Breccia Zone occurrence, which was drilled earlier this year. There, six holes established a minimum strike length of 500 metres with gold grades ranging from 1.15 grams to 2.14 grams per tonne and silver grades from 22 to 159 grams per tonne. The core lengths of the intersections ranged from 24 to 140 metres.

Two other geochemical anomalies coincided with the West Zone and East Zone occurrences, which were also drilled earlier in the year. At the West Zone, an area of about 800 metres by 300 metres contained soils with gold concentrations of 120 to 3,500 parts per billion (0.12 to 3.5 grams per tonne). A single hole drilled mid-year at the West Zone returned grades of 0.95 gram gold and 2 grams silver per tonne over a core length of 30 metres.

At the East Zone, a 400-metre anomaly lies to the north and along strike. Another zone of high gold values sits to the north of the main contact of the Shahuindo porphyry body, and coincides with a zone of high chargeability found in earlier induced-polarization surveying.