Vancouver — A year after geologists traced red-stained road fill back to the quarry it came from and staked the Camino Rojo or “Red Road” project in Mexico, Canplats Resources(CPQ-V, CPQRF-O) has calculated an impressive initial resource estimate for the project.
Almost 36,000 metres of drilling in 111 holes delineated 163.4 million measured and indicated tonnes grading 0.66 gram gold per tonne, 11.56 grams silver, 0.37% zinc and 0.19% lead. Inferred resources add 31.03 million tonnes averaging 0.56 gram gold, 7.63 grams silver, 0.31% zinc and 0.1% lead. Combining all three categories, contained gold stands at 4 million oz. and contained silver at 68.3 million oz.
“It’s an exciting day for us,” said chairman and CEO Gordon Davis. “In our first nine months of drilling we identified a significant resource for less than $3 per ounce (of gold).”
The resource is contained in the Represa zone. When Canplats geologists first arrived at the property, which was then just a road-fill quarry, surface sampling at Represa revealed significant precious and base metal mineralization. Now the zone has been drill-tested along a 1.3-km strike length and remains open along strike and at depth.
The first hole into Represa hit a 146-metre intercept grading 1.1 grams gold, 9.71 grams silver, 0.25% zinc and 0.29% lead. The news sparked investor interest to be sure — from November 2007 to May 2008, Canplats’ share price climbed to $5.25 from just 30¢. It then fell with the rest of the global markets. On news of the resource estimate, Canplats gained 15¢ to close at $1.39.
The company has focused most of its efforts at Represa but also punched a few holes into a nearby target called Don Julio. The Don Julio holes returned favourable alteration and local mineralization. The best intercept came from diamond- drill hole 17, which returned 4 metres of 4.03 grams gold and 18.95 grams silver.
The 3,400-sq.-km property, in northeastern Zacatecas state, is 50 km southeast of Goldcorp’s (G-T, GG-N) Penasquito mine, home to more than 17 million oz. of measured and indicated gold resources. Represa and Don Julio are at the north end of the Canplats property, in a broad, flat valley less than 5 km from a paved highway and high-voltage power lines.
In addition to Represa and Don Julio, Canplats has identified several promising targets areas on its property and plans to conduct reconnaissance field programs. The company has also completed four wide-bore drill holes and begun metallurgical test work.
Davis says the company has some $5 million in its treasury and burns roughly $400,000 a month. Over the next few months, exploration will be limited to the reconnaissance program while the company works on metallurgical testing and engineering studies. He says Canplats expected to start a preliminary economic assessment for Camino Rojo early in the new year.
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