Latin Resources gold shows are shaping Gualdalco to be a major multi commodity project in Peru

Latin Resources (ASX: LRS) has delivered another boost to the Guadalupito Iron and Heavy Mineral Sand Project in northern Peru, which is showing early signs of having the potential to develop into significant multi-commodity "play".

The multi-commodity aspect is supported by the latest results from an extensive sampling program, which has discovered gold up to 5.36 grams per tonne (g/t).

The program consisted of 366 exploration pits, dug just 1 metre deep, which uncovered an average grade of 0.552g/t gold.

Highlighting the gold potential - a total of 64 samples returned plus 1.0g/t gold, with eight samples being greater than 3g/t gold.

The sampling was undertaken in a 1 kilometre by 100 metre spacing along 25 kilometres of strike, and up to 3 kilometres across strike, with a focus on prospective sediment packages.

Chris Gale, managing director, commented on the discovery - and said that he is especially encouraged by these latest results that suggest a high likelihood that gold will be added to the list of value products from the project.

“Clearly Guadalupito is taking shape not only as an Iron Sands project, but also as a robust multi-commodity mineral sands and gold project of world class proportions."

Guadalupito also contains an Iron and Heavy Mineral Sand deposit which displays potential for magnetite, with important levels of coincident heavy minerals including low iron andalusite, a variety of titanium minerals, zircon and rare earth element bearing minerals.

This all adds up to a highly anticipated Inferred JORC Resource, which is forecast to be delivered by Snowden Mining shortly.

Analysis

Acquiring an advanced project of the quality of Guadalupito is rare enough, with potential to become a significant (global) producer of magnetite and heavy mineral sands with potential for low cost development and production.

Importantly, for the project returns, capital costs are expected to be low as only very simple beneficiation will be required due to extensive weathering.

The scale and exploration target of 2 billion tonnes at Guadalupito plus its proximity to infrastructure and port tick more boxes.

The port town of Chimbote is just 25 kilometres away and proximity to one of the largest steel smelters in the country.

The recent investment by major global resources investor RMB Resources should send a signal that current valuation of Latin Resource at around $17 million is low with an upcoming JORC Resource milestone followed by a Scoping Study milestone at the end of 2011, as the company progresses Guadalupito towards production.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/19162/latin-resources-gold-shows-are-shaping-gualdalco-to-be-a-major-multi-commodity-project-in-peru-19162.html