Resource in hand, Magellan Minerals eyeing Coringa gold project’s economics

Vancouver – Magellan Minerals (MNM-V) has outlined a quarter million oz. gold in its first resource estimate at the Coringa project in the state of Para, Brazil.

“Our objective now is to push forward with a scoping study,” says Magellan Minerals president and CEO Alan Carter.

Magellan Minerals pegs Coringa’s measured and indicated resource estimate at 1 million tonnes grading 8.53 grams gold per tonne.

The project, 75 km south of the town of Novo Progreso and accessible by gravel road, is in the Tapajos gold province of Brazil.

Mineralization at Coringa occurs in a shear-vein system within mid-Proterozoic volcanic and granitic rock.

The resource estimate includes mineralization from four nearby zones: Serra, Galena, Meio and Eloy Juara. Thus far the Serra zone accounts for the bulk of gold mineralization.

Vein widths in the four zones are between about 0.5 and 6 metres wide and typically fall in the 2-metre range. Mineralization is by and large within 100 metres of surface.

To account for dilution due to some narrow veining, Magellan Minerals based the resource estimate on a minimum mining width of 1.5 metres. Mineralization is open at depth in all four zones.

Although Carter says Magellan Minerals will continue to drill the Coringa property, the primary focus for the project will now be on preparation of a scoping study, “rather than (trying) to grow Coringa to a million oz. gold.”

In terms of exploration potential, the 19,000 ha. property is covered with gold anomalies identified through stream sampling. There are also a number of near surface historical workings that Carter says he would like to drill beneath.

All told Magellan Minerals says the Coringa property holds over 10 km of mineralized structures. With only about two kilometres of that tested, Carter says the question now is: “What about the other eight?”

Magellan Minerals acquired the Coringa property through a merger between it and Chapleau Resources, a deal finalized Sept. 1, 2009.

At the moment Magellan Minerals has drills turning at its Cui-Cui property, 180 km southwest of the Itaituba, Brazil. In the past few years Cui-Cui has produced some lengthy gold mineralized intercepts, including as much as 220 metres grading 2.02 grams gold.

With about $4 million in cash left in the bank, Carter says Magellan Minerals will soon want to raise additional funds.

On news of the resource estimate Magellan Minerals’ shareprice lost 4¢ to close at 75¢. Magellan Minerals has hovered around the 75¢ mark since January, 2009, and has about 55 million shares outstanding.