Penoles drills more gold and copper at Carmen

Vancouver The final ten holes from this year’s drilling campaign at the Carmen target on the Inca de Oro Sur property, a joint venture between Anaconda Mining (ANX-T) and Minera Penoles de Chile, show strong copper and gold grades.

As part of its 65% earn-in agreement with Anaconda, Penoles began a 28-hole, 12,000-metre, drill program last October that focused on the south-central portion of the Carmen porphyry target. Holes 24, 26 and 28 cut the best grades in the latest batch of drill results.

Hole 24 included a 47-metre intercept grading 1.677 grams gold per tonne, 0.425% copper and 0.0657% molybdenum starting 158 metres downhole. Hole 26 hit as much as 63 metres grading 0.421 gram gold and 0.319% copper starting 382 metres downhole and hole 28 cut as much as 39 metres grading 0.823 gram gold, 0.319% copper and 0.0299% moly starting 283 metres downhole.

The latest results in large part mirror grades reported earlier this summer. Returns then included 257 metres in hole 1 grading 1.1 grams gold and 0.47% copper and 290 metres grading 0.67 gram gold and 0.37% copper.

Penoles has concentrated its efforts on the Carmen target at the around 1,000 ha. Inca de Oro Sur property about 100 km north of Copiapo, Chile where mineralization principally occurs at the contact zone between a tonalite and andesite porphyry and continues through quartz-calcite-sulfide magnetite veinlets in adjacent skarn altered tuffs.

Overall grades in the central mineralized area, mostly veinlets and disseminations of quartz, bornite, chalcopyrite and magnetite, range from 0.5 to 2.0 gram gold and 0.3% to 1.0% copper. Grades surrounding that zone, typically mineralized in quartz, chalcopyrite and calcite, range from 0.1 to 0.5 gram gold and 0.1% to 0.5% copper.

Penoles also drilled a few zones outside Carmen the Juana target 1.5 km to the north, the Lautaro target 3 km to the north and the Rodesia vein 900 metres to the southwest but did not encounter significant gold and copper grades.

The earn-in agreement gives Penoles a 65% interest if, over four years, it spends US$10 million on exploration and pays US$12 million to Anaconda and the other owner of the project, Inversiones EM DOS. If seen through it would give Anaconda a 24.5% stake and EM DOS a 10.5% one.

If Penoles decides to go ahead with a feasibility study, then its stake gets a 5% boost to 70% and Anaconda and EM DOS’ stakes drop to 21% and 9% respectively. As of this spring Penoles has spent about US$3 million on exploration and paid about US$2 million to Anaconda.

In addition to the Inca de Oro Sur property, Anaconda has a number of other properties. This summer it made its first gold pour at its Pine Cove mine about 150 km northeast of Corner Brook, Newfoundland, where it has reserves of about 2.3 million tonnes grading 2.76 grams gold.

Anaconda’s other focus is the San Gabriel iron project in Chile, about 1,000 km north of Santiago. There it has pegged an indicated resource at 57.9 million tonnes grading 32% iron.

On news of the drill results, Anaconda’s share price shed 3 to close at 20. Its 52-week trading range is between 20 and $1.47 and the company has about 60 million shares issued.