VANCOUVER — Following a successful second quarter, producer SilverCrest Mines (TSXV: SVL; NYSE-MKT: SVLC) had more good news for investors in the form of drill results from its flagship Santa Elena silver-gold mine in Sonora, Mexico. The company has released results from 47 reverse-circulation holes that expanded its Main Mineralized Zone (MMZ), which remains open laterally and to depth, and culminated in SilverCrest’s Tortuga zone discovery.
In July SilverCrest tabled a feasibility study for a 3,500-tonne-per-day expansion at Santa Elena. The company incorporated 134 holes into a resource update, though the most recent assays were not available at the time.
On top of potential resource expansion from MMZ, SilverCrest’s newest results expand the recently discovered El Cholugo and El Cholugo Dos zones.
Reported intercepts at MMZ sit up to 100 metres beyond the boundary of SilverCrest’s stope designs and reserve estimates. The mine’s probable reserves total 8.2 million tonnes grading 74.9 grams silver per tonne and 1.24 grams gold per tonne for 19.7 million contained oz. silver and 327,430 contained oz. gold.
Highlights from SilverCrest’s remaining delineation drilling at MMZ include: 9.2 metres grading 4.8 grams gold per tonne and 171.4 grams silver per tonne from 466 metres depth in hole 13-144; 15 metres of 4.03 grams gold and 243 grams silver from 482 metres in hole 13-152; and 13 metres of 3.52 grams gold and 136 grams silver from 481 metres in hole 13-160.
“This delineation drill program at Santa Elena was immensely successful,” says president and COO Eric Fier, explaining that the company drilled the known portion of the deposit at around 35-metre centres, and announced revised reserves and resources, extended mineralization beyond our current reserve boundary and identified three new zones.
SilverCrest’s Tortuga discovery is defined as a northwest-trending vein, breccia and stockwork zone outcropping at surface and within the open pit, hosting similar mineralogy as the MMZ. Tortuga has been drilled within an estimated 200-by-300-metre area, with an average thickness of 3 metres.
The company notes that numerous mineralized veins parallel or sub-parallel to the discovery were also intersected in drilling, and are under review as potential additional targets. Perhaps most importantly, Tortuga is exposed in the north wall of the pit, making the zone accessible during expansion.
Promising intervals from Tortuga include: 17 metres averaging 2.55 grams gold and 115 grams silver from 86 metres depth in hole 12-98; 6.7 metres of 4.43 grams gold and 190 grams silver from 170 metres depth in hole 13-150; and 5.3 metres averaging 10.5 grams gold and 572 grams silver from 127 metres depth in hole 13-167.
The company drilled 58,500 metres during its program. It maintains one drill on site, which will be used to complete a 1,500-metre underground program aimed at design work on the first production stopes, which are scheduled to be mined in late 2014.
SilverCrest spent $4.8 million in expansion drilling and feasibility work over the past six months, and reported $30 million in cash and equivalents at mid-year.
The company indicates it has committed 65% of Santa Elena’s US$65.2-million development capital, with the expansion on track to hit a production target in early 2014.
SilverCrest’s share price increased 6%, or 12¢, on Sept. 6, on news of the Santa Elena drill results. Shares have traded within a 52-week range of $1.19 to $2.96, and closed at $2.22 at press time.
SilverCrest has 109 million shares outstanding for a $241-million market capitalization.