Cayden Resources (TSXV: CYD; US-OTC: CDKNF) keeps hitting gold at its El Barqueno project in Jalisco state, Mexico, coming up with its third discovery at the project in July.
The junior reported results from three holes at the project’s Angostura target, with hole 85 returning 12 metres of 4.6 grams gold per tonne from near-surface, including 2 metres of 21.45 grams gold.
Another hole returned 13 metres of 1.54 grams gold starting at 7 metres depth, while a third was lost in a fault zone and did not return significant results.
Results from seven holes are pending.
Angostura is the third target to be drill-tested at El Barqueno, which lies 100 km west of Guadalajara. All three targets are open in all directions.
The first target test, Azteca, returned encouraging results from a 41-hole drill program totalling 6,300 metres, and testing 1.4 km of a 2.2 km prospective strike length. Highlights from Azteca include 44 metres grading 2.34 grams gold per tonne from 44 metres depth, 59 metres of 2.2 grams gold from 48 metres depth and 16 metres of 5.89 grams gold from 30 metres depth.
Angostura is 1 km northwest of and parallel to Azteca. The initial program at Angostura has so far tested a tenth of the target’s 500-metre strike length.
Drilling this year at Pena de Oro, which lies 7 km northeast along strike from Azteca, has returned intersections of 45 metres of 4.06 grams gold and 0.39% copper from 49 metres depth and 27 metres of 4.46 grams gold, 1.7 grams silver and 0.09% copper from surface. The target has been drilled along 500 metres of strike length.
El Barqueno is described as a low-sulphidation epithermal gold project. All of the targets at the project are interpreted to be part of an epithermal vein network with a dominant 8 km long, southwest–northeast trend.
Pena de Oro is on the northeast end of the dominant 8 km mineralized trend, while Azteca is at the southwest end. The company has identified nine targets so far for follow up.
Drilling over the past 10 months at El Barqueno has confirmed a correlation between gold mineralization and radiometric potassic alteration anomalies.
Cayden also released results from trenching at Pena de Oro, including highlights of 8 metres grading 2.27 grams gold, 8 metres of 1.85 grams gold and 23 metres of 0.78 gram gold.
The trenches were dug in an area northwest of the company’s drill program at the target, on a parallel structure.
Cayden’s geologists expect mineralization to intensify with depth, as they believe that the underlying pyroclastic rock is more prospective than the overlying tuff and silica unit that was tested.
The company adds that the trench results indicate that parallel mineralization zones could add width to the mineralized area already identified through drilling.
Cayden plans to prepare an initial resource estimate for El Barqueno in the first half of 2015, company CEO Ivan Bebek said early in the year.
The company only has drill permits for areas of the concessions where there has been previous disturbance. In forested areas of the project, however, an MIA or environmental impact assessment is required before the company can carry out trenching and drilling.
Cayden expects to get MIA permits in the fall, after which it can start delineation drilling in preparation for a resource estimate in the first half of 2015.
Bebek believes each of the nine targets identified at El Barqueno — which represent about half of the 464 sq. km property — could host 1 million oz. gold, or more.
“It’s an exciting project for the reason that we don’t know what our best target is yet,” Bebek said in May.
“That’s something that you don’t see usually in one junior mining company. Early in our days of acquiring this, an analyst commented this is a major’s exploration project in a junior and there should be eleven drills turning throughout these targets on your property.”
The junior signed an option deal in April 2012 to earn 100% of the project from Grupo Mexico for $8 million paid over three years. It has already paid just under half that amount, with a US$2-million payment due in October, and another $2.4 million due in April 2015.
Grupo Mexico retains a 1.5% net smelter return royalty (NSR), plus an annual advance royalty starting two years after Cayden exercises its option, if production is not achieved by then. The Mexican Geological Survey also has a 2.5% NSR on the property.
Cayden has $9 million in its treasury.
The company’s shares hit a new 52-week high of $2.47 several days after it announced its third discovery at El Barqueno. The shares traded as low as 85¢ last July. Cayden has 47.4 million shares outstanding.
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