San Fernando drilling returns values

Drilling on the Viruela zone of gold project in the Mulatos area of northwestern Mexico has returned oxide gold and high-grade copper values.

Owner San Fernando Mining (TSE) describes the Viruela as a mushroom-shaped zone of quartz chalcedony breccias and veins which appear to be the upper levels of a large, epithermal system of precious and base metal mineralization.

Four holes returned oxide gold mineralization within quartz chalcedony breccias, with values ranging from 1.41 grams gold per tonne over 5.2 metres up to 3.62 grams over 4 metres.

Hole 9, in addition to intersecting the upper breccia zone, returned three intersections within a copper-rich bonanza zone below the breccia body. Intersections include 22 metres grading 0.14 grams gold and 9.5 grams silver per tonne and 0.45% copper; 8 metres grading 0.082 grams gold, 48.5 grams silver and 3.14% copper; plus a 1.5-metre intersection grading 0.31 grams gold, 252.7 grams silver and 16.4% copper. The hole was stopped at a depth of 310 metres in the high-grade zone (the result of a lack of drill rods) but will be deepened in the current program.

Further drilling will test the high-grade zone along strike and to depth. Drilling on the Cruz zone, 800 metres to the southeast, also returned oxide gold intersections. Three of the five holes drilled returned values of 1.4 grams over 22 metres, 2.7 grams over 12 metres and 2.4 grams over 30 metres, respectively.

The three holes cover a strike length of 175 metres, and drilling continues to delineate the zone along strike and at depth.

Subject to shareholder approval, San Fernando plans to sell its entire interest in the Viruela/Cruz project to Ace Development (VSE) in return for common shares.

San Fernando holds about 19% of Ace’s common shares. As a result, the transaction is considered “related party.”