El Limon takes shape for Miranda (December 03, 2002)

Vancouver — Drill results reported by Teck Cominco (TEK-T) and Miranda Mining (MRM-V) confirm that mineralization extends north of the El Limon gold prospect on the Morelos Norte project in Mexico’s Guerrero state.

The latest drilling is part of a $1-million program designed to increase the gold resource and confirm the exploration potential along strike from El Limon. Thirty-three holes were drilled in a program spanning 4,040 metres.

Fifteen holes were drilled north of the previously defined resource, where holes 3, 4 and 6 cut 24.3 metres grading 1.8 grams gold per tonne, 25.8 metres grading 5.1 grams gold, and 31.9 metres grading 5.3 grams gold, respectively. Results from 10 holes have been received to date, including the following:

• Hole 61

— 5.04 grams gold over 23 metres from surface.

• Hole 62
— 4.25 grams gold over 6.7 metres at 98.5 metres down-hole.
• Hole 63

— 19.27 grams gold over 5 metres at 7 metres down-hole.

• Hole 64

— 8.14 grams gold over 3.9 metres from surface.

• Hole 66

— 0.99 gram gold over 4.9 metres from surface.

• Hole 67

— 1.8 grams gold over 6.1 metres from surface.

• Hole 68

— 12.9 grams gold over 23.8 metres from surface.

• Hole 69

— 1.11 grams gold over 4.4 metres from surface.

• Hole 70

–1.9 grams gold over 12.7 metres from surface.

• Hole 71

— 1.31 grams gold over 5.7 metres from surface.

Moving west, similar skarn and oxide mineralization has been identified near or along the hornfels-marble contact. The best previous values came from hole 37, which yielded 8.44 grams gold over 4.6 metres, and 1.6 grams gold over 4.6 metres. In total, 12 new holes totalling 1,795 metres have been completed, with assay results pending.

At the 1-sq.-km La Amarilla target, six holes totalling 1,435 metres were completed, with results pending. The area is believed to be the northern extension of the El Limon West hornfel-marble contact. A previous drill hole returned 22.8 metres grading 1 gram gold.

Late last year, crews completed 29 holes and outlined a section of gold-bearing skarn mineralization covering a 1,000-by-300-metre area. Mineralization is associated with magnetite, pyrrhotite, chalcopyrite and pyrite. The northern part of the zone is near the surface, whereas the southern portion occurs at depths exceeding 100 metres.

The joint venture has completed a preliminary metallurgical report on seven composite samples from the 2001 drill program. The results showed that gold could be recovered from the sulphide-rich portions of the mineralization by a simple flow sheet consisting of a grinding circuit followed by cyanide leaching and then a carbon-in-pulp circuit using activated carbon.

A preliminary inferred resource from the first 60 exploration holes indicates that El Limon holds 1.6 million oz. gold but is probably not large enough to warrant a stand-alone project for Teck Cominco. A revised resource estimate for El Limon is expected to be complete next year.

Teck, which holds a 78.3% stake in the project, picked up the 260-sq.-km property, 150 km southwest of Mexico City, in 1998, when the Mexican government auctioned off unclaimed parts of the 500-sq.-km Morelos national mining reserve. Bidding US$3.1 million, Teck considered the area prospective for skarn-style mineralization similar to the nearby Nukay project, which hosts a resource of 4.4 million tonnes grading 4.47 grams gold in three separate zones, plus an indicated resource of 28.4 million tonnes averaging 1.64 grams gold at the Los Filos zone.

In the third quarter of this year, Miranda picked up a 30% equity stake in Compania Minera Nukay from Teck Cominco, giving the junior 100% of Nukay. The price tag was $700,000 payable by issuing 2 million shares and 500,000 warrants.