Silvermex Resources boosts resource at San Marcial (October 10, 2008)

As far back as the 1780s and well into the early 1900s, references in the local library in El Rosario indicate that the area around Silvermex Resources‘ (SMR-V) San Marcial property in west-central Mexico was an active silver-gold camp with more than 20 known prospects and mines within a 15 km radius.

The region is certainly proving to be fertile exploration ground for Silvermex today. The Vancouver-based junior has expanded its resource estimate for San Marcial to 18 million oz. silver in the indicated category and 4.4 million oz. silver in the inferred. (The updated resource includes an upgrade of the old resource of 14.26 million oz. silver into the indicated category from the inferred category.)

San Marcial now contains an indicated resource of 3.75 million tonnes, grading 149.20 grams silver per tonne, 0.36% lead, and 0.67% zinc. In the inferred category, the deposit contains 3.07 million tonnes grading 44.21 grams silver per tonne, 0.29% lead and 0.51% zinc.

Those figures yield contained zinc of 55.3 million lbs. and 29.9 million lbs. lead in the indicated category and 19.5 million lbs. lead and 34.7 million lbs. zinc in the inferred.

The block model resource estimate was calculated using a cutoff grade of 30 grams silver per tonne for open-pit resources and 80 grams silver per tonne for underground resources.

The new resource estimate was based on a total of 4,884 metres of diamond drilling in 27 holes completed by both Silvermex and previous operators.

San Marcial is situated along the western edge of the Sierra Madre Occidental geological province, about 12.5 km south of the town of Las Rastra within the Las Rastra mining district. The property is about 90 km east of the city of Mazatlan in Mexico’s Sinaloa state.

Silvermex has an option with Silver Standard (SSO-T, SSRI-Q) to acquire 100% of the project. Prior to Silvermex, the most recent work on the deposit was by Gold-Ore Resources (GOZ-V) and Silver Standard, between 2000 and 2002.

Recent drill results include a 66-metre interval that returned grades of 205.9 grams silver per tonne, 0.31% lead and 0.47% zinc from surface (hole SM-04) and a 93.3-metre interval that returned 104.2 grams silver per tonne, 0.474% lead and 0.7858% zinc from 83-186.3 metres, including a 19.45-metre interval that returned 234.4 grams silver per tonne (hole SM-08-08).

The geology at the 1,250-hectare San Marcial property can be divided into two distinct rock types. First there is the upper volcanic group made up of basal conglomerates, rhyotlites and dacites, which occur in the higher and more mountainous parts of the property in the northeast. The basal conglomerate lies on the surface above the lower volcanics and basaltic to andesitic dykes and sills intrude into the upper volcanic group.

The silver mineralization is hosted in steeply dipping, north-east trending quartz veins and stockworks up to 93 metres in width within the Lower Volcanic Group and within the volcano-sedimentary sequence.

The mineralization continues over a strike length of 600 metres and at least 250 metres vertically.

The zone is open down dip and along strike for at least 1,800 metres. The high-grade silver mineralization occurs in irregular veins, stockworks pods and fissure fillings.

Five oxide and sulphide samples from holes SM-2, SM-4 and SM-5 were subjected to column leach tests. Recoveries from all columns were higher than 80% over a 72-hour leach period.

Additional metallurgical test work was done on four samples made up of drill core rejects, with recoveries from flotation and cyanidation ranging from 90% to 97.9%.

Silvermex is currently trading at about 30 a share. Over the last year it has traded at between 24 (Oct. 8 2008) and $1.44 (Nov. 8 2007.)

The Vancouver-based junior has 25.43 million shares outstanding.