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Tuesday, 27 November 2012
SilverCrest Mines extends main trend at La Joya beyond current resource area
SilverCrest Mines (CVE:SVL) (AMEX:SVLC)(NYSE MKT:SVLC) unveiled Tuesday more results from the phase II drilling at its La Joya property in Durango, Mexico, which the company says have extended the main mineralized trend beyond the current resource area.
Five of the 15 holes reported today continued to test the southern extension of the Main Trend with the remaining 10 holes focused on the delineation of the Contact zone and the Santo Nino target.
Silver values in this series of core holes along the Main Trend and Contact zone ranged from 3.3 grams per tonne (g/t) to 189.0 g/t. Silver equivalent based values range from 19.7 to 324.1 g/t, with mineralized intervals ranging from 15.2 to 288.7 metres.
Notable holes at the Main Trend included 5.0 metres of 135.5 g/t silver, 0.11 g/t gold, and 1.14% copper, or 240 g/t silver equivalent.
At the Contact zone, the company said that drilling has shown wide-spread tungsten, gold and copper mineralization from near surface, to depths of up to around 300 metres vertically. The area is considered a "potential large bulk tonnage tungsten target", and will be segregated as part of the next resource estimate due in the fourth quarter this year.
Meanwhile, drilling to test the Santo Nino target, which is located around 1km east of the Trend's eastern boundary, yielded 18.4 meters of semi-massive sulphides grading 20.1 g/t silver, 0.04 g/t gold and 0.43% copper.
SilverCrest said the mineralization is believed to be associated with "a substantial east-west structure" that cross cuts the width of the Trend mineralization to the west.
The phase II drill program is essentially complete, the silver explorer and producer said, and was designed to test around 2.5 kilometres of the Trend.
Based on company surface mapping, sampling and historic drill hole results, the southern area is still believed to be potentially the highest grade area along the Trend.
SilverCrest is currently looking at the potential for a near-surface, higher grade, low strip open pit as a conceptual "starter pit" that will be evaluated in a preliminary economic assessment next year.
Metallurgical test work is also underway, with results to be included in the NI 43-101 technical report in early 2013.
Currently, La Joya is estimated to have an inferred resource of 101.9 million ounces silver equivalent. But the company said the target size, based on the current geological model, drilling and sampling from the phase II program, suggests the possibility of resources that may be 50 to 100 per cent greater than the current estimate.
The Vancouver-based comapny said earlier this month that profit and revenues increased in its third quarter, with record silver production allowing it to raise its annual forecast for the year.
Earnings were boosted by higher silver sales, and an exchange gain on a stronger Canadian dollar, partially offset by a derivative impact as well as income and a deferred tax expense.
Cash flow from its Santa Elena operations in Mexico, a key metric in the industry, more than doubled to $10.2 million, or 11 cents per share, up from $5.03 million, or 6 cents per share, in the year-earlier period.
Revenues rose 11 per cent to $16.7 million. SilverCrest sold 57 per cent more silver, at 152,088 ounces, in the latest period, while gold sold also grew 4 per cent, to 7,923 ounces.
The mine is a high-grade, epithermal gold and silver producer, with an estimated life of mine cash cost of US$8 per ounce of silver equivalent. SilverCrest anticipates that the 2,500 tonnes per day facility should recover around 4.8 million ounces of silver and 179,000 ounces of gold over the 6.5 year life of the open pit phase of the mine.
A three year expansion plan is underway to double metals production at the Santa Elena Mine, while exploration programs are advancing the definition of the large polymetallic deposit at the La Joya property in Durango State.