Canplats Red Road discovery boosts share price 170%

Vancouver – Stained rocks in a recently improved roadbed led Canplats Resources (CPQ-V) geologists to the companys newest discovery, a near-surface polymetallic zone in Zacatecas state, Mexico. And results from the first three reverse circulation holes punched into the Represa zone pushed Canplats shares price up 85 or 170% on over 6 million shares traded to close at a new record high of $1.35, far above the previous high of 78 from February 2004.

The three RC holes were drilled from the same collar but in different directions, and all three intersected precious and base metal mineralization from surface. Hole 1, inclined as minus 50 degrees north, returned 146 metres grading 1.1 grams gold per tonne, 9.71 grams silver per tonne, 0.29% lead, and 0.25% zinc. Hole 2, pointed minus 50 degrees to the west, cut 129 metres grading 0.76 gram gold, 11.87 grams silver, 0.29% lead, and 0.25% zinc. And hole 3, drilled at minus 50 degrees to the east, returned 147 metres of 1.05 grams gold, 10.87 grams silver, 0.38% lead, and 0.27% zinc.

Mineralization in the Represa zone is hosted in weak to moderately silicified, laminated siltstones and sandstones with moderate to intense hematite alteration and localized zones with weak to moderate brecciation and fine quartz micro-veinlets. Mineralization starts at surface, covered by an overburden ranging in depth from 0.25 metres to 3 metres, and to date is entirely oxide in nature.

The Represa zone is part the Camino Rojo, an aptly-named project that translates as red road in honour of how it was discovered.

Weve had couple geologists scouting for new opportunities in northern Mexico for year or more, says Gordon Davis, Canplats president and CEO. They were driving along a gravel road and noticed hematite-stained boulders on the surface and bedside the road, part of what looked like fairly recent road improvements.

Intrigued, the group asked traced down the source of the road fill down to a small quarry. Canplats quickly staked some 100,000 hectares of ground and started a test-pitting program. Pits dug at 50-metre intervals returned individual samples assaying up to 6.18 grams gold, 1.24% zinc, and 1.46% lead.

The pit sampling defined an area 600 meters by 450 metres, with a higher-grade zone at the core. Represa remains open to the east and west where pit sampling could not reach bedrock. The current RC drill program is expected to total 1,700 metres. Canplats is bringing two diamond drill rigs on site in the new year.

In addition the company recently completed an induced polarization survey that shows a distinct anomaly coincident with the mineralization at Represa. The survey also identified a second anomaly on the southwest corner of the grid.

The second anomaly resembles and is even larger than Represa, Davis says. Weve got one hole into that and weve awaiting those results. The company is also waiting for results from several further holes drilled at Represa.

As for the unconventional discovery of Camino Rojo, Davis is taking it all in stride.

Grassroots exploration is a high stakes game but you shouldnt be surprised if youre successful from time to time, he says. You have to be diligent and alert, and then hopefully you get lucky.