Minefinders boosts Dolores (March 27, 2000)

The first 15 holes of an ongoing infill drill program at Minefinders‘ (MFL-V) wholly owned Dolores gold-silver project in Mexico’s Chihuahua state continue to enhance the high-grade portion of the resource.

Designed to confirm continuity of the gold-silver mineralization in feeder structures over a 4-km strike length and to a vertical depth of 300 metres, the initial holes infilled a 400-metre-long segment of the zone at 25-metre intervals. Highlights are as follows:

– Hole 119 cut 131.1 metres grading 0.98 gram gold and 26.8 grams silver per tonne. Included in this intersection were two higher-grade sections, returning up to 4.1 grams gold and 39.1 grams silver over 4.6 metres.

– Hole 120 cut 114.3 metres grading 0.84 gram gold and 25.4 grams silver, including three higher-grade sections, which returned up to 9.79 grams gold and 176.1 grams silver over 4.6 metres.

– Hole 121 cut 61 metres grading 0.5 gram gold and 15.5 grams silver.

– Hole 122 cut 50.3 metres grading 0.87 gram gold and 10.2 grams silver, including a higher-grade section running 2 grams gold and 22 grams silver over 6.1 metres.

– Hole 123 cut 32 metres grading 3.56 grams gold and 41.8 grams silver, including a higher-grade portion hitting 10.1 grams gold and 110.9 grams silver over 9.1 metres.

– Hole 124 cut 3.1 metres grading 1.18 gram gold and 18.4 grams silver in an 18.3-metre zone of mineralization grading 0.27 gram gold and 24.5 grams silver.

– Hole 125 cut 32 metres grading 1.68 grams gold and 52.2 grams silver, including three higher-grade portions returning up to 3.76 grams gold and 288.4 grams silver over 3.1 metres.

– Hole 126 cut a 10.7-metre section running 1.63 grams gold and 35.2 grams silver in a 75-metre mineralized zone averaging 0.93 gram gold and 19.9 grams silver.

– Hole 127 cut 93 metres grading 1.59 grams gold and 36 grams silver, including five higher-grade sections returning up to 7.34 grams gold and 190.5 grams silver over 4.6 metres.

– Hole 128 cut 47.3 metres grading 1.06 grams gold and 11.9 grams silver, including a 6.1-metre section returning 3.6 grams gold and 31.2 grams silver.

– Hole 129 cut 126.5 metres grading 0.97 gram gold and 12.2 grams silver, including two higher-grade sections returning up to 3.52 grams gold and 50.8 grams silver over 9.1 metres.

Minefinders revised its resource estimate for Dolores late last year. At a cutoff of 1 gram gold-equivalent, the resource is estimated at 35.2 million tonnes grading 1.4 grams gold and 84.46 grams silver per tonne, equivalent to 1.6 million contained ounces gold and 95.6 million contained ounces silver. Minefinders used a capping factor of 30 grams gold and 100 grams silver.

In late 1998, an initial scoping study by MRDI concluded there was economic potential for an open-pit resource of 47 million tonnes grading 0.79 gram gold and 48 grams silver (or 1.2 million oz. gold and 72.7 million oz. silver) at a stripping ratio of 2.9-to-1. The estimate was based on a cutoff grade of 0.4 gram gold-equivalent, with the higher-grade material capped at 10.2 grams gold and 447 grams silver.

The study concluded that the project could be put into production at a capital cost of US$80.5 million and would produce an annual average of 71,226 oz. gold and 3.3 million oz. silver, or 125,244 oz. gold-equivalent, over a mine life of 14 years at a cash cost of US$177 per oz. gold-equivalent. The project showed an internal rate-of-return of 11.4%, based on prices of US$300 per oz. gold and US$5.50 per oz. silver.

Minefinders believes the Delores main zone represents only a small portion of a large epithermal gold system. Drilling will continue on this zone, followed by the drill-testing of surrounding prospects at the Norte, North Dome, East Dike, La Bohemia, Sur and Southwest zones. The final feasibility study of the Main zone is expected by 2001.