Capella Resources (KPS-V) has intersected 105 metres of 1.59 gram gold per tonne in a drill hole on its Lajitas project in the Maricunga district of the Andes in northern Chile. The intercept starts at a depth of 142 metres.
The intercept is part of a 261- metre intercept grading 0.91 gram gold per tonne, from a depth of 90 metres down hole.
On news of the intercept, Capella shares rose 6¢ to 28¢, with 26,000 shares changing hands. The next day shares peaked at $1.70 before pulling back. Shares were trading at $1 at presstime and now have a 52-week trading range of 3¢-$1.70.
The hole was drilled at an angle of -60 degrees into an induced polarization anomaly 1.8 km in diameter. True widths of the intercepts are not yet known.
The hole, no. 8011, was drilled to a 483-metre depth, in a series of three holes totaling 1,330 metres. The other two holes returned anomalous gold and copper mineralization, but with much lower grades.
Distances between holes are at least 500 metres. The 3-hole drilling campaign has now ended.
The system is characterized as porphyry gold-copper mineralization. The intercept is hosted in oxidized andesitic volcanoclastic and dacitic intrusive rocks that are variably altered with iron oxides, clay and silica. The host rocks are said to exhibit some of the deepest oxidation known in the Maricunga.
Capella believes that the hole encountered mineralization both in the dacitic intrusive rock, part of the primary porphyry system, and in the andesitic volcanic rock.
However, this interpretation is preliminary because the rock is extremely altered and all oxidized, so rock types cannot be determined easily. No sulphides have been encountered in the intercept.
The best copper intercept in the hole measured 33 metres of 0.15% copper starting at 294 metres down hole.
As a bonus, drilling has also encountered groundwater, and Capella is planning to apply for water rights.
The Lajitas property covers 16 sq. km. It is about 12 km southeast of the Lobo-Marte project, recently acquired by Kinross Gold (K-T, KGC-N), and 18 km east of Andina Minerals’ (ADM-V) Volcan project. Elevations range between 4,200- 4,500 metres.
Lajitas is subject to a 5% net smelter return (NSR) royalty, of which 3% can be bought for US$3 million. The project is northeast of the city of Copiapo, a 3.5-hour drive away, and 7 km from the border with Argentina.
Capella owns a second project in the Maricunga, the 19-sq.-km Nevada project, immediately to north of Exeter Resource’s (XRC-V, XRA-X) Caspiche project, and 10 km south of Kinross’ Maricunga mine.
Capella has identified an induced polarization anomaly on the property, about 4.5 km from the centre of Caspiche. Capella is planning to drill three 500-metre holes on the Nevada project in April.
In March, Capella raised $776,000 in a private placement. The company has $400,000 of debt outstanding, repayable in June.
On March 5, Capella announced the conversion of debt, owed to both arm’s-length parties and non arm’s-length parties, to shares. On March 26, the company announced that $320,000 of debt was converted to 4 million shares and 1.9 million warrants. A warrant entitles the holder to buy a share for 15¢ within two years.
Capella has about 24.5 million shares issued, or 39.3 million shares fully diluted.
Capella has announced a nonbrokered private placement of 6.8 million units at 73¢, for $5 million. A unit consists of a share and a warrant. A warrant entitles the holder to buy a share for $1.25 for 12 months, subject to acceleration. Capella has also granted 2 million stock options.