Nayarit Hunts High Grade At Orion

SITE VISIT

ANIMAS, MEXICO — Nayarit Gold’s (NYG-V, NYRTF-O) vice-president of exploration, Hall Stewart, would love to go chasing veins on the company’s 1,120-sq.-km Orion property in Mexico.

“The district potential to stumble into vein after vein after vein is enormous,” he says. “But I’ve got to focus here. That’s what management is pushing us to do. And I think it’s the right thing.”

“Here” is an east-west-striking epithermal vein system in the northwest corner of Nayarit’s Orion property called the Animas and Del Norte veins. It is where Nayarit has focused the bulk of its drill program over the year and a half since hole 30, the discovery hole, hit as much as 7.5 metres grading 5.26 grams gold per tonne and 437 grams silver.

About 100 holes later (and counting) Nayarit has begun to get a decent picture of what’s going on underground at Animas and Del Norte, the two dominant and parallel running veins in the system.

Nayarit has defined about 700 metres of mineralization to a depth up to 450 metres with a thickness between 10 and 30 metres. What has excited Nayarit’s management and investors alike is within that broader mineralized area: A 400-metre-long section with high grades of gold and silver.

“There are a number of different mineralized structures,” Stewart says. “But this is the one we’ll be building on.”

The Del Norte vein is a near-vertical structure, while the Animas vein dips moderately to the south. Of the two, Del Norte, to the north of Animas, tends to show greater widths of mineralization. In a long section of the Del Norte vein, gold-silver mineralization takes an amoeboid shape within which are two smaller blobs of higher grades, one to the west and the other to the east.

Hole 30 struck the western high-grade zone in Del Norte close to its midpoint at a depth of about 200 metres. Drilling out in all directions has returned similarly high grades of gold and silver over long intercepts. About 80 metres west of hole 30, for instance, hole 59 cut 48.4 metres grading 2.72 grams gold and 218 grams silver at about the same depth. That included a 3-metre intercept of 23.78 grams gold and 2,040 grams silver.

About 80 metres east of hole 30, and again at about the same depth, hole 32 cut 61.5 metres grading 1.68 grams gold and 171.2 grams silver. Within that was an 11-metre section grading 7.41 grams gold and 808.6 grams silver.

The eastern high-grade area has produced like results. For example, hole 95 cut 12 metres grading 11.78 grams gold and 974.2 grams silver, starting 250 metres down-hole. About 100 metres above it, hole 94 hit as much as 14 metres grading 3.99 grams gold and 425.7 grams silver.

What accounts for the high grades? The east-west striking veins noticeably bend about midway along the extent so far drilled. “We think the main thing that is controlling the mineralization is this flexure,” Stewart says. The two most common minerals hosting gold and silver are acanthite and electrum.

Around the two “blobs” of mineralization, the grades tend to fall under a gram gold and 50 grams silver per tonne, albeit still over fairly long widths (up to around 50 metres). Though the grades drop off, mineralization is still open along strike and at depth.

The reason Nayarit has concentrated efforts on Animas and Del Norte is, of course, to try and outline a mine-worthy deposit. That, Stewart believes, could come in the form of an underground mine.

While Nayarit writes on its web-site there may be the potential to both open-pit and underground mine portions of the vein system, Stewart argues against the former.

“Sure, you can put a mining pit on top of it,” he says. “But are you really going to bring a mining team in to take out a couple million tonnes of (potential) ore?”

That is a debate for another day, however. For now, Stewart hopes Nayarit can produce a resource estimate by June. To that end, Stewart says infill drilling will continue up to April, after which the company will complete assays and further refine its vein models as it works towards that goal.

He says Nayarit has been “over-drilling in one dimension but not the other.” Spacing between drill holes is close enough on north-south sections, he says, but not in between the sections for a resource estimate. With infill drilling ongoing, he believes Nayarit will be able to get about 50% of the resource estimate in the measured and indicated categories.

Regardless of how much of the planned resource estimate ends up in those categories, Stewart believes they will suit mining. “I think with what we now have, especially because of the grade and width (of mineralization), it is economic,” he says.

If that turns out to be the case, the project is well located for development. It is only a 45-minute drive from Nayarit’s field office and core shacks in Las Animas and the terrain is fairly moderate. Water has not been a problem — Stewart says if anything, he’s wanted to get rid of some — and power runs near to the property.

As for the mineralization’s potential minability, Stewart says: “We have really, really good rock.” There are no deleterious elements such as arsenic or mercury, he says, and historic metallurgical tests at a now inactive gold-silver mine several kilo-metres west of Del Norte and Animas (on the strike, on the Orion property and on the same structure) showed recoveries of between 90% and 95% on a sample grading about 3 grams gold and 254 grams silver.

To ensure access to its property through the small village of Motaje, the company has a written agreement with the local government or “communidad.” That agreement does not extend to mining at this point, Stewart says.

“If we went underground, we could buy a small plot of land,” he says. “I don’t anticipate any problems — but you never know.”

He also notes that the open rolling country around the Del Norte and Animas veins would be great for building mine facilities.

And then there is the rest of the property. The system hosting Animas and Del Norte has been traced on surface and along strike for more than 4 km. About a kilometre to the west of Animas and Del Norte, there are three historic mines within an area Nayarit is calling the Francisco target, and less than a kilometre to the east, there is one at the Pantaleona target.

Drilling at Francisco has defined mineralization over a 400-metre strike length and hit as much as 1.29 metres grading 57.92 grams gold and 3,909.2 grams silver. Stewart says drilling there continues.

To generate additional targets, Nayarit also recently completed a large geochemical survey. Stewart sent out two teams of three into the field and blanketed potential areas with soil sampling. He says he is looking for a geochemical signature that includes copper, lead and zinc in the 100 ppm range.

Why is the region flush with potential targets? Stewart says a large northwest-trending structure created significant numbers of lateral extensions. On surface, an outcrop may be but 2 metres or so wide. Below surface, however, as has proven the case at Del Norte, it can expand to more than 10 metres wide.

But with far more targets than can be drilled with the money Nayarit has, Stewart tows the line: “I want you to come away from this site visit and say they are doing everything possible to fast track this (Del Norte/Animas) project.”