THE GLOBAL SEARCH FOR GOLD SPECIAL — Dayton drilling boosts resource at Andacollo

An aggressive exploration program at the Andacollo gold mine in central Chile has enabled Dayton Mining (DAY-T) to expand gold resources by 350,000 oz. to 2.6 million oz.

A highlight of recent drilling is the discovery of a high-grade contact breccia zone, where Dayton intersected 468 ft. grading 0.135 oz. gold per ton. The structure, which exists downdip of a contact between a diorite intrusive and dacite volcanics, measures 100 ft. wide and is open along strike.

The company has allocated $5.2 million to its 1996 exploration program.

A 40,000-ft. program of rotary and core drilling was conducted in the first half of 1996, with ore-grade mineralization reportedly encountered in most holes. Before the end of the year, Dayton intends to carry out a further 30,000 ft. of drilling. Minable reserves will then be recalculated.

“As we continue to develop our geological understanding of the property, we are optimistic reserves will more than double,” says President Wayne McClay.

Dayton has acquired three new properties in Chile, two of which, situated near the Andacollo mine, are expected to augment reserves in the near term.

The third, the Lolita, lies 100 miles north of Copiapo and was previously mined underground. Having evaluated several hundred rock samples and nearly 22,000 ft. of core drilling (completed by the previous operator), Dayton believes Lolita could potentially be developed as a bulk-tonnage mining operation.

Drilling will begin immediately on these three properties.

With a cash position in excess of $30 million and strong cash flow from Andacollo, Dayton is well-positioned to acquire other promising projects, McClay says.