Following an encouraging evaluation of the Anabella gold project in western Guatemala,
The evaluation indicates a resource of about 4.5 million tonnes grading 2.6 grams gold per tonne gold and 0.5% antimony at the Anabella mine and 1.75 million tonnes grading 5.4 grams gold and 2.3% antimony at the LC mine.
The property, which Aquest acquired this year from a privately held Guatemalan company, covers a 5-km-long trend of gold-antimony mineralization plus a mine, mill and smelter.
The acquisition price was US$4 million in cash and US$6 million in Aquest convertible debentures. The agreement also calls for prepaid royalties of 5% of the recoverable metal value of the first 1 million tonnes of ore and 3% on the remaining reserve. Total payments are capped at US$25 million.
The deal was subject to a 9-month due diligence, but, based on underground sampling and 19 drill holes in the Anabella and LC mine areas, Aquest decided to extend this period to April 2002. Under the terms of the extension, Aquest will pay the vendors US$100,000 in the fourth quarter of 1999, plus an additional US$10,000 per month starting in February 2000 and continuing through the option period.
“The overall objective is to outline 15-20 million tonnes of ore before the option expires,” says Aquest’s chief financial officer, Rodney Shier.
High-grade antimony lenses have been mined from the Anabella area intermittently since the late 1960s. Mineralization is hosted in fine-grained, disseminated arsenopyrite in argillaceous siltstones and carbonaceous shales.
During the preliminary evaluation, Aquest targeted Carlin-style, sediment-hosted gold mineralization in the Anabella and LC mine areas.
At the Anabella mine, eight holes tested the continuity of mineralization in a 300-by-150-metre area. Hole 1 intersected four mineralized zones ranging from 6 to 10 metres in width. The total length-weighted average was 2.79 grams gold and 0.96% antimony over 28 metres.
Hole 2 was collared 125 metres east of the first hole and returned a length-weighted averaged of 0.55 gram gold and 1.95% antimony over 8 metres.
Hole 3 was collared outside the mine area, some 200 metres east of the first hole, and intersected three mineralized zones. The total length-weighted average was 2.38 grams gold and 0.88% antimony over 22 metres.
Hole 5 was drilled 100 metres east of the first hole and intercepted four mineralized zones with a total length-weighted average of 2.12 grams gold and 0.83% antimony over 48 metres.
A hundred metres west of the first hole, hole 6 hit one mineralized zone over a 10-metre interval grading 3.53 grams gold and 0.01% antimony.
Holes 4 and 8 were put down in the centre of the deposit. Hole 4 was drilled northeast and intersected strong gold and antimony mineralization in four zones. The total length-weighted average was 3.28 grams gold and 0.6% antimony over 84 metres. Hole 8 was collared 50 metres southwest of hole 4, drilled southwest and hit four mineralized zones with a total length-weighted average of 3.32 gram gold and 0.45% antimony over 98 metres.
Based on limited drilling and underground sampling, the indicated and inferred resource in the immediate Anabella mine area is 4-5 million tonnes grading 2.6 grams gold and 0.5% antimony.
At the LC mine, 1 km to the west, Aquest drilled 11 vertical holes.
Holes 9 through 12 were collared within the limits of the LC mine area along a 200-metre section of the 700-metre strike length of the mineralized zone. Results confirm the manto style of mineralization at LC.
Hole 9 intersected 16 metres averaging 6.29 grams gold and 1.45% antimony, starting at a depth of 74 metres, including 2 metres of 25.49 grams gold and 4.5% antimony.
Hole 10 cut 10 metres averaging 2.59 grams gold and 0.72% antimony starting at 84 metres down-hole. This included a 2-metre section of 6.07 grams gold and 3.19% antimony.
Hole 11 intersected 32 metres averaging 5.23 grams gold and 3.01% antimony starting at 78 metres down-hole. Included in this intercept were two 4-metre intercepts of 13.3 grams gold and 8.03% antimony and 11.59 grams gold and 3.2% antimony.
Hole 12 cut 18 metres averaging 3.73 grams gold and 1.52% antimony starting at 82 metres down-hole.
Drill holes 14 through 16 were collared 75 metres southwest of holes 9-12, along a 100-metre section of the LC zone.
Hole 14 intersected 5 metres averaging 3.91 grams gold and 1.14% antimony, starting at 74 metres down-hole.
Hole 15 intercepted a 6-metre interval averaging 15.91 grams gold and 7.77% antimony starting at 48 metres down-hole.
Hole 16 hit 4 metres averaging 4.06 grams gold and 0.48% antimony starting at a downhole depth of 60 metres.
Drill holes 13 and 17 through 19 were collared just north and south of the LC mine workings and failed to intercect any significant mineralization.
Based on the limited drilling and on the known extent of the underground workings, Aquest estimates an indicated and inferred resource of 1.5 to 2 million tonnes grading 5.4 grams gold and 2.3% antimony.
The company, which intends to arrange financing for a second phase of exploration, has 15.2 million shares fully diluted and $250,000 in working capital.
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