Noranda dismounts Caballo Blanco (September 23, 2002)

Noranda (NRD-T) has dropped its option to earn a 75% stake in Almaden Minerals‘ (AMM-T) Caballo Blanco property on the eastern coast of Mexico, near Veracruz.

To earn its interest, the major was responsible for completing a positive feasibility study, a US$2 million cash payment and subscribing for US$1 million worth of Almaden’s treasury shares. The deal also included pre-existing work obligations.

Noranda recently wrapped up a 2,100-metre diamond drill program focused on the Central Grid area, where past drilling and geophysical surveys indicate the presence of a copper-gold porphyry deposit.

The program was highlighted by Noranda’s final hole, which returned a 6-metre section running 1.42 grams gold per tonne. Lower in the hole, a 3-metre (from 192 metres below surface) interval runs 2.5 grams gold. The holes tested an area of argillic alteration associated with a gold-in-soil anomaly.

Almaden plans to look for a new partner at the project as it reviews Noranda’s data. The junior says several companies have expressed interest in the property’s gold potential. Caballo Blanco is also considered prospective for high-sulphidation epithermal gold mineralization. A float sample from the Northern area ran up to 11 grams gold per tonne. Noranda had focused on the porphyry copper potential of the property.

The picture is bit brighter at the wholly owned Elk gold property in British Columbia. There, ongoing drilling is aimed at expanding known resources of the Siwash North and WD vein systems.

So far 2,600 metres have been sunk in 16 holes; 4,500 metres of drilling are planned.

Five 50-metre stepout holes tested the WD; the best result was a 2.15-metre true width running 19.2 grams gold and 88.3 grams silver pre tonne. The hole is the deepest on the structure so far. Almaden says all of the holes cut the vein near the projected depth and will boost the zone’s inferred resource, which stands at about 21,100 tonnes averaging 42.9 grams gold.

Two holes were collared on the Bullion Creek structure, 500 metres to the north, to test a zone of hydrothermal alteration. The holes cut altered granodiorite with narrow pyritic quartz veins yielding 3.5 grams gold over 1 metre.

Results are pending from four holes on the Gold Creek West vein, 400 m southwest of the Siwash Gold Mine. The holes cut the vein at the projected locations and extended continuity. Underground and open pit operations at the Siwash mine produced 51,460 oz. of gold from quartz vein ore from the B vein system during the mid-1990s.

The DeepB shoot on the B vein system is located immediately below the existing mine workings. Four perimeter holes designed to extend the shoot down plunge. The best interval – 0.5 metre of 21.5 grams gold and 17.4 grams silver, came at a depth of 251.5 metres in hole 2319. The shot plays host to an inferred resource of about 11,100 tonnes of 100.3 grams gold.

Situated 45 km southeast of Merritt, the property hosts eight gold-bearing pyritic quartz veins. Mineralization is hosted in granitic rocks near the margin of a major batholithic intrusion at the contact with mafic volcanic rocks.

Almaden plans a new resource/reserve calculation to include the 2002 drill results.