Yamana determined to bring home the Bacon — Drilling encounters high-grade silver at Argentine project

A second round of drilling has confirmed the presence of high-grade silver-gold mineralization at the Bacon prospect in the Patagonia region of southern Argentina’s Santa Cruz province.

In an attempt to outline reserves, Yamana Resources (YRI-T) drilled 48 short core holes, totalling 2,375 metres. Efforts were focused on a 250-metre section of the Veta Martha structure, the length of which exceeds 1,500 metres. Yamana’s president, Victor Bradley, says the company hopes to outline a contained resource of 10 million oz. silver. Toward this end, Micon International has been commissioned to evaluate the data, with results expected by year-end.

The company drilled a fence pattern of three or four parallel angle holes in each fence along the vein at 25-metre spacings.

Says Project Manager Mel Klohn: “These mineral systems are difficult to evaluate because veins abruptly pinch and swell both along strike and downdip, and, typically, extreme grade variances are encountered in closely spaced drill holes.”

For these reasons, the company chose to drill shorter holes. To date, drill crews have not penetrated the vein structures below 100 metres depth.

At least six of the 48 holes returned silver values greater than 5,000 grams per tonne over a true thickness of 0.5-1.5 metres. The best intercept occurred in hole 37, which cut a true thickness of 8.1 metres grading graded 2,989 grams silver and 4.4 grams gold per tonne. The intercept occurred 13 metres above a trench which crosses the vein outcrop. Assay values from the trench encountered 1.9 metres (true thickness) grading 39,000 grams silver (that amounts to 3.9% silver) and 108 grams gold. Hole 49, drilled within the same fence as hole 37, intersected the structure 41 metres below the surface, hitting 2.4 metres of 2,528 grams silver and 3.56 grams gold. In all, the fence line holes penetrated the structure at a depth of 102 metres below the surface.

Other highlights include: hole 39, which returned 7.3 metres of 1,591 grams silver and 1.78 grams gold; hole 38, which cut 3.65 metres of 4,831 grams silver and 5.9 grams gold; and hole 48, which intersected 4.7 metres of 2,267 grams silver and 3 grams gold.

Although Yamana has thus far drilled only 66 holes on the extensive Bacon vein system, Richard Walters, the company’s executive vice-president, believes the results are conclusive:

“I am confident that we have found a commercially viable silver deposit, the magnitude of which is yet to be determined,” he says.

The recent drilling focused on four new targets within the Bacon prospect, which, in total, comprises 321 sq. km of mineral rights and 357 sq. km of surface rights.

• Sugar Hill — At this prospect, which appears to be the eastward extension of Veta Martha, Yamana geologists collected high-grade values from float material next to the vein. Hole 64 encountered the vein 17 metres below the surface, returning 357 grams silver per tonne over 0.8 metre.
• Veta Medio — Across this structure, Yamana completed a fence of four holes, all of which encountered lower-grade silver mineralization. Hole 84 targeted the vein structure as much as 169 metres into the subsurface; results are pending.
• Veta Northeast — Rock samples collected from this area indicate subcropping quartz veins with high-grade values. Hole 62 confirmed these results with a short interval of 0.32 metre grading 2,317 grams silver, 26 metres below the surface.
• Veta Martha Oeste — Yamana intersected strong mineralization in two scout holes at this target. In a 300-metre stepout, reverse-circulation hole 82 hit a true thickness of 1.7 metres grading 473 grams silver and 2 grams gold. Stepping out another 200 metres, another reverse-cirulation hole hit 1.7 metres grading 315 grams silver.

Klohn says that although these four targets did not encounter the bonanza-grade mineralization found at Veta Martha, “the assay returns, together with the mineralogical and textural characteristics at these four sites, indicate that our drill holes may have nicked the top of more high-grade silver shoots.”

He adds: “These are all good indications that we are dealing with a very large, silver-pregnant hydrothermal system.”

The company has also located two targets north of the main area of drilling. At the Far North Bacon prospect, geologists have collected 85 chip samples that indicate the presence of two quartz-sulphide vein structures about 1 km northeast of Veta Martha. And 6 km north of Veta Martha, Yamana has outlined another east-trending structure, which it calls Argenta Centro. Sixty-one rock samples from this area contained silver and gold values, as well as copper, lead and zinc.

The Bacon property is northwest of, and adjacent to, the Manantial Espejo silver-gold project, which is jointly owned by Black Hawk Mining (BHK-T) and Barrick Gold (ABX-N).

Yamana also controls considerable land holdings in other parts of the Deseado Massif of Santa Cruz province, including the Lejano and Ciclon West cateos to the north, and the Martinetas and Microonda cateos in the east.

The company has completed a special warrant financing for $4.7 million. Proceeds are to be used to continue exploration throughout the Santa Cruz region.