Tuesday, 28 February 2012

Kootenay Silver firmly focused on Promontorio project, updated resource expected

Vancouver-based junior explorer Kootenay Silver (CVE:KTN) is firmly pinning its hopes on the Promontorio silver project in Mexico.

Kootenay Silver’s flagship property is the former-producing Promontorio silver mine in Sonora State, Mexico. The company is also actively developing other mineral projects in Mexico and British Columbia, Canada.

But the company's focus on Promontorio was a driver in the recent change of its name from Kootenay Gold.

Speaking to Proactive Investors, Kootenay Silver’s chairman, Ken Berry, said: "Our focus is on the Promontorio property and building that silver resource. We feel that we're at a real stage in development where that resource is a significant asset.

"Our core asset has grown to such a stature it warranted a name change."

Promontorio itself hosts an NI 43-101-compliant resource containing 8.9 million indicated ounces of silver plus 1.17 million ounces of inferred silver, 99.3 million indicated pounds of lead plus 13.4 million inferred pounds of lead, and 110.8 million indicated pounds of zinc plus 14.3
million inferred pounds of zinc.

The indicated resources are contained within 5.22 million tonnes of 52.7 grams per tonne (gpt) silver, 0.86% lead and 0.96% zinc, and the inferred resources are contained within 0.65 million tonnes grading 55.7 gpt silver, 0.94% lead and 1.0% zinc.

Since the 2010 resource estimate, Berry said that Kootenay has drilled 31,000 metres and has another 4,000 metres left to drill before publishing an updated estimate within the next few months.

Indeed, a steady stream of positive news has been flowing from Promontorio.

Results to date have uncovered consistent, widespread silver mineralization with several high-grade silver intercepts throughout the Pit Resource, the Southwest Extension Zone, and the Northeast Zone, which sits about 700 metres outside of the current 43-101 Pit Resource.

Notable results from the latest program, which is the single largest and most expansive drill program conducted by Kootenay on the property to date, include hole KP-09-07, which intersected 6.7 metres grading 1,008.0 gpt silver equivalent.

Hole KP-25-08 hit 7.85 metres of 773.6 gpt silver equivalent, while DH-110-11 intersected 7.0 metres grading 678.6 gpt silver equivalent, including 4.5 metres at 1,145.5 gpt silver equivalent.

The company has also reported wide interval results, including hole DH-052-11, which hit 146.0 gpt silver equivalent over 234.0 metres, including 236.3 gpt silver equivalent over 70.0 metres.

These encouraging results suggest the possible existence of a large porphyry system similar to major producing deposits within the region, the company said.

Of its numerous joint venture programs, Berry highlighted three drill programs that he reckons will provide shareholders with potential discoveries.

Berry said that joint venture partner Pinecrest Resources (CVE:PCR) will likely be drilling the Epiritu polymetallic vein/breccia project in Sonora, Mexico, and Copper Creek Gold (CVE:CPV) is drilling the Santa Lucia project, part of the Sierra Madre Occidental gold-silver belt.

Kootenay is also awaiting results from the Copley property in the Nechako Plateau of north central B.C.

Berry said that Kootenay was "well-funded" for the current drilling program and for the NI 43-101 resource update, recently receiving funds from an accelerated warrant exercise program that was "well-received".

Looking ahead, as the global macroeconomic climate improves, Berry believes that companies with an advanced and growing resource - such as Kootenay Silver - will be the focus of the capital markets in the coming years.

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