Silver Standard hits high-grade silver

Vancouver — Junior Silver Standard Resources has cut a thick sequence of silver mineralization at its wholly owned Bowdens deposit in New South Wales, 200 km northwest of Sydney.

The high-grade intersection was part of a 7-hole, 1,178-metre drilling campaign that focused on two areas: Main Zone North and Bundarra North.

Hole 171, collared in Main Zone North, cut 101 metres grading 101 grams silver per tonne plus lead and zinc credits, starting at a down-hole depth of 103 metres. Included in this intercept was a section that assayed 211 grams silver over 21 metres. The hole ended in mineralization.

Hole 168 cut 21 metres grading 42 grams silver, while holes 169 and 170 only intersected anomalous values.

In the Bundarra North zone, hole 166 cut 42 metres grading 43 grams silver plus 2.3% combined lead and zinc, starting at 47 metres down-hole. This included a 22-metre section of 75 grams silver plus 3.47% combined lead and zinc. Hole 166 was collared in the same area where a previous phase of drilling identified several lenses of silver mineralization with base metal values that ranged from 1.1% to 2.16% combined lead and zinc.

Hole 165 intersected 2 metres grading 73 grams silver, while hole 167 intersected only anomalous silver values.

Silver Standard will use the drill results to update the resource calculation at Bowdens. A revised block-model calculation is to be tabled by September.

At last report, the Bowdens deposit had measured resources of 14.6 million tonnes grading 61.1 grams silver (28.9 million contained ounces), plus indicated resources of 12.5 million tonnes grading 48 grams silver (19.3 million contained ounces), and 30 million tonnes of inferred resources grading 38.7 grams silver (37.4 million contained ounces).

In other news, Silver Standard has signed an agreement with Australian Imperial Granite and Minerals to earn a 51% interest in the Bluey’s Silver prospect and the surrounding tenement. Silver Standard is required to repay Imperial Granite’s staking and tenement costs to a maximum of A$10,000 and spend A$750,000 on exploration. The company can increase its interest in the property to 90% by completing a bankable feasibility study.

The 53.5-sq.-km property is 93 km east of Alice Springs in the Northern Territory. It encompasses the Bluey’s silver prospect, which Silver Standard believes has the potential to host a large, high-grade, silver resource with open-pit potential. Of 12 rock samples taken in an area that measured 125 by 115 metres, seven assayed between 490 and 11,900 grams silver per tonne. Also reported were copper values of up to 13.2%.

Silver Standard has kicked off a 13-hole program of reverse-circulation drilling, which is expected to span 540 metres. The drilling is to be completed in early September.

Meanwhile, at the Manantial Espejo silver-gold deposit in southern Argentina, the company has increased its indicated silver-equivalent resource at the Karina-Union vein by 44%.

A 5,142-metre drill program, completed in early winter of last year, focused on the Karina-Union vein system (T.N.M., Aug. 20-26/01). Measured and indicated resources from the deposit now total 4.39 million tonnes grading 263.8 grams silver and 4.51 grams gold per tonne, which represents a 9.9% increase in silver-equivalent resources.

The inferred resource stands at 1.59 million tonnes grading 258.2 grams silver and 3.65 grams gold per tonne. Measured and indicated resources represent 73% of the total resource.

Drill results included bonanza grades over narrow widths (6,189 grams silver per tonne and 26.4 grams gold over a 1-metre interval in hole 176), as well as high-grade results over longer intervals (hole 178 intersected 444.3 grams of silver and 4.92 grams of gold per tonne over 18.6 metres). Pincock Allen & Holt reviewed the resource data.

Black Hawk Mining (BHK-T) will hold a 90% interest in the Manantial Espejo project as soon as it completes its purchase of 20% from Barrick Gold (ABX-T). Silver Standard will hold the remaining 10% interest, with an option to earn a further 40% from Black Hawk in return for paying US$1.5 million (now paid) and spending US$4.5 million on exploration by 2002 (extendible to 2003 under certain conditions). Underlying vendors retain two royalties, one of which is tied to production but can not exceed $600,000. The other is a 0.5% net smelter return.

Silver Standard has $4 million in working capital.