San Anton, Goldcorp up Cerro del Gallo resource

Vancouver – San Anton Resource (SNN-T) and Goldcorp (G-T, GG-N) have raised the resource estimate for their Cerro del Gallo gold-silver-copper project on the companies’ San Anton property 270 km northwest of Mexico City, Mexico, and are focusing their efforts on producing a scoping study.

“I guess we’ve decided it’s big enough now. In fact, it’s enormous,” president and CEO John Cook says. “We really don’t need to do any more drilling.”

Cerro del Gallo is one of numerous exploration targets on the 2.2-sq. km San Anton property where the company holds an exploitation concession. San Anton owns a 58% interest in the property, and Goldcorp owns the other 42% remainder. Other parties hold a 4% net smelter return royalty.

The new estimate adds 118 new drill holes and 36,000 metres of new drilling to the 232 holes and 58,000 metres of drilling completed for the last resource estimate released 18 months ago.

The latest round of infill and step-out drilling increases the measured and indicated resource at Cerro del Gallo 43% over the previous estimate to 461 million tonnes grading 0.27 gram gold per tonne, 11 grams silver per tonne, and 0.11% copper. It is based on a 0.2 gram gold and a 0.07% copper cut-off.

A pit optimization study, completed before the latest resource estimate, and based on a US$600 per oz. gold, US$10.8 per oz. silver, and US$3 per lb. copper price, suggested that 59 million measured tonnes grading 0.74 gram gold, 13 grams silver, and 0.08% copper and 173 million indicated tonnes grading 0.25 gram gold, 15 grams silver and 0.12% copper, would be captured in an optimized pit shell.

Cook says the pit optimization will be updated to reflect the new resource estimate.

“All our focus now is getting [a scoping study] done so we can present something that is capable of being mined,” Cook says. “If the scoping is really good we’ll probably jump straight to a feasibility study.”

He surmises that a mine could be developed within 3 to 4 years. “But that’s a bit of a thumb-suck,” he says, as any plans would be subject to getting permits and raising capital. In the near term he expects to have the scoping study complete in the next quarter.

The Cerro del Gallo mineralized area has been divided into gold and copper domains, both held within an altered ash-flow tuff sequence, mostly peripheral to central intrusives. San Anton’s drilling program has concentrated on a 1-sq. km area, but the mineralized zone is open at depth and along strike.

On news of the updated resource estimate June 17, San Anton’s share price jumped 11 to close at 40. Shares traded at 35 at press time. Goldcorp shares traded at $41.06 at press time, and were little affected by the Cerro del Gallo news.