LATIN AMERICA — Golden Peaks targets veins in Argentina

Two Vancouver-based juniors, Golden Peaks Resources (GL-V) and Primo Resources (PRI-V), have teamed with Mitsubishi of Japan to explore for gold and silver in northwestern Argentina.

The joint venture has budgeted a total of US$2.8 million for a 3-phase program on the Sierra de Las Minas and Los Dos Buhos properties, which straddle the boundary between the provinces of La Rioja and San Luis. Mitsubishi can earn a 30% interest in the two properties by spending US$1.5 million on exploration. Once the earn-in is complete, Golden Peaks, the operator, and Primo will each hold 35%.

The first phase of the US$750,000 program, already under way, consists of prospecting and silt sampling, trenching, geophysics and 4,000 metres of diamond drilling.

The Vancouver-based junior will perform an induced-polarization electromagnetic survey to delineate drill targets and new vein systems. The drilling will focus on expanding the known mineralization at the Vallecito and Los Dos Buhos vein systems, with reconnaissance work planned for newer targets.

The 254 rock samples collected thus far include 135 silt samples; the remainder are a mixture of grab and trench samples. All assays were performed by ITS Bondar Clegg.

To date, Golden Peaks has identified 13 gold-bearing quartz vein systems on the two properties. About 35% of the 51,000-ha property has yet to be explored.

At the Los Dos Buhos property, a vein system of the same name comprises four northeasterly trending veins that lie in an area measuring 1,800 by 400 metres. The veins have been dubbed the LDB, Vein 2, Vein 3 and Vein 4.

The LDB has been traced for about 800 metres, and Vein 3 covers a strike length of about 1,000 metres. Veins 2 and 4 are shorter, though the company says their full extent has yet to be revealed.

Diamond drilling in 1997 intersected two potentially significant mineralized structures in the LDB vein: the C and Tr-4 zones. Hole 2 hit the C zone at a depth of 67 metres down-hole and cut 1.4 metres grading 13 grams gold per tonne. Another 1.4-metre intercept was hit at a depth of 94.8 metres down-hole; it ran 8.9 grams gold.

Hole 7 intersected the Tr-4 zone, cutting 1.5 metres of 5.73 grams gold starting at a depth of 24.6 metres down-hole. This interval included a 0.5-metre intercept that graded 17 grams gold. Both zones appear to be open at depth and along strike.

In the hangingwall of the C zone, silicate and sulphide fragments were discovered. Some samples ran as high as 22.6% copper, 10.8% zinc and 33.5 parts per million silver.

On the Sierra de Las Minas property, north of Los Dos Buhos, Golden Peaks has completed a series of trenches on four vein systems: Cerco Quemado, Portezuelo, Vallecito and Esperanza. Assay highlights are as follows:

* Cerco Quemado — Trench 11 tested the CQ-2 vein and averaged 7.14 grams gold and 2.5 grams silver over 1 metre. The vein has been traced for about 100 metres and varies up to 1.5 metres in width. Trench 12 tested the same vein along strike and hit 10.6 grams gold and 19.8 grams silver over 1.0 metre. Trench 13 tested the CQ-1 vein, 35 metres from vein CQ-2, and cut 3.74 grams gold and 2.2 grams silver over 0.5 metre.

* Portezuelo — Ten trenches were emplaced on the northeasterly trending P-1 and P-2 veins and the north-westerly trending Merc-1 vein. The P-1 vein varies from 2 to 7 metres in width and has been traced for more than 400 metres. To the south, the P-2 vein has a width of up to 4 metres and strikes for 450 metres. Trenching results varied from 0.36 gram silver over 4 metres and 0.02 gram gold over 0.5 metre, to 20.4 grams silver and 0.16 gram gold over 2.5 metres. The Merc-1 vein, 400 metres southwest of P-1, has been traced for 80 metres and averages 2 metres in width. Trenching at Merc-1 cut 2.6 grams gold and 34.1 grams silver over 2 metres.

* Vallecito — This is an en echelon system of nine north-southerly striking veins that trend in a northwesterly direction for about 800 metres. Seven trenches were emplaced along the vein segments. Vein 5 returned values that ran 0.06 gram gold over 0.5 metre and 11.86 grams silver over 1.25 metres. Vein 1 was drilled in 1997 and intersected 5 grams gold over 8.1 metres, starting at a depth of 34.9 metres down-hole. This intercept included a 2-metre interval that averaged 11.9 grams gold.

* Esperanza — Four trenches were emplaced on the northeasterly trending E-1 and E-2 veins. The trench on E-2 returned 0.17 gram gold over 0.5 metre and 3.1 gram silver over 4 metres.

A few previously unknown vein systems were discovered at the Videla, Corral and Skull zones.

At the Videla zone, which is 800 metres northeast of the Cerco Quemado vein system, three northwesterly trending veins were found with average widths of up to 2 metres. The veins have been traced for 60 metres. Initial assays of grab samples ran from 1.2 to 68.7 grams gold and 2.5 to 450 grams silver.

At the Corral zone, 2.3 km northwest of the Los Dos Buhos vein system, two poorly exposed, northeasterly trending veins were unearthed. The veins were found to be about 2 metres wide and up to 50 metres long. About 14 grab samples were collected, six of which returned values that ranged between 0.4 and 31.9 grams gold. Silver values ranged from 1.3 to 26 grams for 12 samples.

The Skull vein, 600 metres north of Videla, is poorly exposed and measures up to 1 metre wide. The vein was traced for 65 metres, and nine grab samples were taken. Assay results returned values ranging from 0.1 to 67.1 grams gold and 1.3-76 grams silver.

The area comprising Sierra de Las Minas and Los Dos Buhos is in the Sierra de Las Minas region, which has been known for its gold-silver potential since the early 1900s.

The first important geological study was conducted in 1911 by Heinrich Bondenbender, who investigated the soutern part of La Rioja province and reported on the mineral occurrences in the area. He recognized the main rock units to be Precambrian or Cambrian schist, gneiss and granite, overlain unconformably by sedimentary rocks of Carboniferous to Triassic age and mentioned quartz veins containing economic metallic mineralization. During the next several decades, the region was prospected and investigated by private and government groups. Several of the gold prospects were investigated by British railroad personnel during the construction of the railway in southern Le Rioja province.

For the next 80 years, only a limited amount of small-scale mining for copper, gold and silver had occurred, and little systematic exploration was carried out. The first significant exploration of the region was a joint study by the Japan International Co-operation Agency and the Metal Mining Agency of Japan, conducted in 1992-93. The joint venture sampled, mapped and documented the quartz veins in the area. The Vallecito showing was a float discovery, with float near the vein returning 131 grams gold per tonne. This led to the staking of the Sur and Corral cateos by Lopex & Associates. In June 1994, the first follow-up to the Japanese study was conducted, by Minas Argentinas S.A. This work included a silt geochemical program.

The regional geology of Sierra de Las Minas occupies a geological time period beginning with the Precambrian and continuing into recent time. The gneissic-granitic rock units of Precambrian and/or Paleozoic age form the basement and most of the outcrops in the region, including the Chepes formation and the Ulapes Migmatite and Asperezas granitic intrusions.

These units are disconformably overlain by carboniferous continental sediments of the Malanzan formation, which grade transitionally into the Permian La Colina formation.

During the Tertiary period, the Pliocene Los Llanos sediments were deposited. Pleistocene semi-consolidated conglomerates and Holocene alluvium and gravels are the most recent contributions to the stratigraphy of the area.

The geological history of the regions began with the emplacement of the Chepes formation, which is a calc-alkaline intrusive plutonic complex. The Chepes formation became metamorphosed, structurally disrupted and intruded
by the Asperezas granitic bodies. During later Carboniferous and early Permian times, the Malanzan formation was deposited in the north-southerly trending structural depressions that were created by the early period of faulting. During Tertiary time, the north-south structures were re-activated, followed by northeast-southwesterly movement, northwest-southeast settlement and a final north-southerly movement along the Ulapes fault (possible thrusting). Gold mineralization is associated with the latter structural events.