EXPLORATION 1998 — Sierra Nevada tests Mexican property

Sierra Nevada Gold (SDD-V) plans to begin drilling on the Republica high-grade silver property in Mexico’s Chihuahua state.

The company will target a block of vein material in the Main zone that is thought to contain high-grade silver ore leftover from mining during colonial times.

By examining old data, the company has postulated that vein material grading up to 175 oz. silver per ton may still be found between the 300 and 400 levels. Records suggest that there could be as much as 17,500 tons of such material.

The Main vein covers a strike length of 1 mile, with andesite in the hanging wall and a rhyolitic intrusive in the footwall. Unfortunately, the mine fell into disrepair and flooded below the 300 level after it was closed in 1912.

Drilling will test this block as well as determine if the values continue at depth.

Sierra Nevada will also examine a geochemical anomaly 500 ft. to the north, where samples returned values as high as 25 oz. silver per ton. The company believes this could be another ore shoot coming off of the Main zone. The company plans several shallow drill holes to test this theory, and also plans to reopen nearby workings.

In all, Sierra Nevada plans to complete 6,000 ft. of drilling on the property.

Sierra Nevada’s Mexican subsidiary has the right to purchase the property for US$200,000 and a 4% net smelter return royalty.

Northeast of Republica lies the Promontorio copper-gold project, where Sierra Nevada recently calculated a resource of 1 million tonnes grading 4% copper, 2.5 grams gold and 63 grams silver.

The resource was recalculated using a copper price of 75cents per lb., a gold price of US$300 per oz. and a silver price of US$6.50 per oz.