Herencia Resources says drilling at Paguanta confirms new vein and extends high-grade Cathedral vein

Herencia Resources (AIM: HER) reported promising high grade results from the first three holes in its current diamond drilling campaign at the Paguanta zinc-lead-silver-gold  project in Chile, extending the high-grade Cathedral vein by at least 80 metres to the west of the current resource and confirming a new vein south of Cathedral.

Assay results for the first two holes confirm the presence of a new vein, and included an intersection of 10.5 metres at 5.13% zinc, 0.97% lead, 63.4 g/t (grammes per tonne) silver and 0.27 g/t gold including 2.17 metres at 17.62% zinc, 3.27% lead, 224 g/t silver and 1.08 g/t gold and 3.5 metres grading 1.81% zinc, 0.61% lead, 30.15 g/t silver and 0.36 g/t gold from 158.75 metres from hole PTDD035.

Hole PTDD036 intersected 3.0 metes at 2.05% zinc, 0.83% lead, 41 g/t silver and 0.19 g/t gold from 139.8 metres including 1 metre at 3.56% zinc, 0.92% lead, 55.9g/t silver and 0.45g/t gold including 0.25 metres at 8.37% zinc, 5.01% lead, 193g/t silver and 0.36 g/t gold.

These results coincided with those from diamond drill hole PTDD031, which also intersected the new vein and reported grades of 2 metres at 11.87% zinc, 5.83% lead, 327 g/t silver and 0.34 g/t and 6 metres at 3.61% zinc, 1.17% lead, 57.6 g/t silver and 0.66 g/t gold from 124.5 metres including 1.5 metres at 7.5% zinc, 2.50% lead, 113 g/t silver and 1.59 g/t gold.

Herencia said that as hole PTDD036 was terminated in mineralisation, potential exists to further extend the zone.

Results from the third hole, PTDD37, the first to target a western extension of the Cathedral vein, have confirmed that mineralisation continues at least 80m to the west of the current resource, and that high grades are again in evidence.  The best intercept returned 5 metres at 8.25% zinc, 0.19% lead, 25.1 g/t silver and 0.52 g/t gold from 177 metres including 2 metres at 16.5% zinc, 0.18% lead, 38.3 g/t silver and 0.91 g/t gold.

“We are pleased to see mineralisation being confirmed in the new vein and to see continuing high grades being achieved. Extending the Cathedral vein was always the main goal for this program so intersecting high grade mineralisation in the first hole is a great result. We continue to note the consistent presence of gold mineralisation in all the Paguanta veins which bodes well for future Project economics. Whilst early days, the opportunity to expand the current mineral resource estimate appears likely,” said Managing Director of Herencia Resources Michael Bohm.

The program is on schedule to deliver assay results by June 2010 with an update to the company’s mineral resource estimate expected by mid-2010.

Drilling continues, and is still focusing on extending the Cathedral vein.

Last week, the company announced it has has decided to assay all samples from the current 2010 diamond drill program at Paguanta for gold in addition to assaying for base metals.  After the majority of holes within the existing resource envelope intersected gold mineralisation, the company is seeing growing potential for gold credits to enhance future project economics.

While the focus will remain on zinc, lead and silver, Herencia is encouraged by the obvious potential to enhance the economics, as the recent assay results have now confirmed that over 80% of holes drilled within the existing resource envelope at Paguanta have reported gold mineralisation. 

The project currently has an indicated and inferred mineral resource of 3.15 Mt at 3.9% zinc, 1.3% lead and 74 g/t silver including a higher grade component of 1.01 Mt at 6.6% zinc, 2.2% lead and 119pm silver.

The company has recently raised £1.37 million through an issue of 250 million new shares for Paguanta and its adjacent La Rosa porphyry-copper prospect.

Shares in the company were up 3.6% on the news by midday.

http://www.proactiveinvestors.co.uk/companies/news/14917/herencia-resources-says-drilling-at-paguanta-confirms-new-vein-and-extends-high-grade-cathedral-vein-14917.html