LATIN AMERICA SPECIAL — Work enhancing Arauco discovery

Ongoing work by Arauco Resources (VSE) is enhancing the company’s new gold find in southern Chile.

Earlier this month, the junior reported encouraging trenching results from the discovery (T.N.M., March 6/95), without revealing the property’s location. It has since been disclosed that the find was made on the Guindo property, about 240 km south of Santiago at an elevation of 300 metres, in gently rolling hills similar to California’s foothills.

The property was staked by Arauco three years ago, and is wholly owned by the company. Access and local infrastructure are described as “excellent.” Fred Hewett, Arauco’s chief operating officer, said credit for the discovery goes to the company’s Chilean team, headed by Richard Culbert and Patrick Burns. Arauco’s original strategy in Chile was to explore mainly in the south, away from the competing major companies concentrated in the north. The initiative began with literature research, and then reconnaissance field programs. The find on the Guindo property was the result of a more recent regional prospecting program, as well as geochemical work.

“This is an original discovery,” Hewett told The Northern Miner. “We were a little worried at first that, because the grades from the first few samples were so good, they might be from narrow veins. But we now think it is definitely some type of disseminated deposit with bulk-tonnage potential.” Arauco is encouraged by the geology of the property, which hosts two known intrusives with silicified volcanics between the intrusives. Hewett cautions, however, that results to date are from surface trenching, and that no work has been done to test the zones in the third dimension.

Results were previously reported from trenching on the A and B zones. The latest results are from initial sampling of the C zone, which occurs about 75 metres east of the B zone.

Hand-trenching in the southern portion of the C zone returned a grade of 4.56 grams gold per tonne (0.133 oz. per ton) over a sample length of 46 metres. The majority of the samples were taken over 2-metre intervals in outcrop and subcrop.

To date, three zones have been discovered. The average grade of all 192 samples taken in the A, B and C zones is 5.07 grams (0.148 oz.) gold. This average includes sampled material which appears to lie outside the zones. More results are expected shortly from trench sampling of the A and B zones. Mechanical trenching will begin shortly, and a drill program will begin once trenching results have been received and interpreted.

Arauco is 62%-owned by Santa Elina Gold (TSE).