Some 19,029 meters worth of reverse-circulation drilling in 222 holes has allowed Silver Standard Resources (SSO-T) to boost silver resources at the Berenguela silver-copper-manganese project in southern Peru.
Berenguela is now estimated to contain an indicated silver resource totalling 15.6 million tonnes running 132 grams silver per tonne, for 66.1 million contained ounces of silver. Another 6 million tonnes of 111.7 grams silver are categorized as inferred resources. The estimates employ a cutoff grade of 50 grams silver.
Silver Standard’s drilling was completed under an option agreement with property owners Sociedad Minera Berenguela and Fossores. The deal called for SSO to update the silver resource to National Instrument 43-101 standards. The company also paid US$200,000 and 17,500 shares on signing, and committed to at least US$500,000 worth of drilling and other work.
In return, Silver Standard holds an option to acquire the property’s silver resources. At current prices, the resources would cost US6 per oz., payable in cash and shares. The option expires on Nov. 3, 2005.
Berenguela produced more than 11 million oz. of silver, plus copper, from 500,000 tonnes of ore grading 750 grams silver between 1905 and 1965. Drilling in the 1960s led to a resource estimate of 14 million tonnes grading 125 grams silver, or 56.3 million contained ounces. The resource also contained 1.32% copper and 18% manganese.
The stratiform replacement deposit occurs in folded dolomitic limestone. Hydrothermal solutions are believed to have deposited iron and manganese oxides with silver, copper and minor zinc. The near-surface deposit is more than 500 metres wide, 1,500 metres long, and 60 metres thick.
Studies suggest the deposit is capable of supporting a 700,000-tonne-per-year mine that would produce around 5.9 million oz. of silver annually over 20 years.
Metallurgical tests indicate recover rates of more than 90% for manganese, copper and silver via conventional crushing followed by leaching with sulphuric acid and sulphur dioxide.
Meanwhile, ongoing drilling in Mexico has linked the Breccia Ridge and South Ridge zones at the Pitarrilla silver project, 150 km north of Durango city.
Combined, the zones extend for a total strike length of more than 1.1 km. The zone remains open along strike and at depth.
Diamond drilling on the Breccia Ridge zone is highlighted by an 83.8-metre section running 130.2 grams silver, 1.6% zinc, and 0.6% lead, including 28.2 metres of 308.6 grams silver, 1% zinc and 0.7% lead. South Ridge yielded up to 76.2 metres averaging 93.8 grams of silver per tonne. Reverse-circulation (RC) drilling on the zone returned up to 43 metres of 266.5 grams silver, including 9 metres averaging 751.9 grams silver.
RC drilling some 500 metres to the north, on the newly discovered Saddle zone, cut up to 28 metres containing 154 grams silver.
Infill drilling on the recently discovered near-surface Javelina Creek zone, about 1 km north of the Breccia Ridge zone, is highlighted by 50 metres of 198.8 grams silver. The zone measures 200 meters by 300 meters.
Pitarrilla is now home to five drill-defined zones — Cordon Colorado, Pena Dyke, Breccia Ridge/South Ridge, Javelina Creek, and Saddle zones.
So far, indicated resources in the Cordon Colorado and Pena Dyke zones are pegged at 16.5 million tonnes grading 113.5 grams silver, for 60.2 million contained ounces of silver. Another 4.8 million tonnes of inferred material runs 85.1 grams of silver.
The company plans to focus its efforts for the rest of the year on extension- and infill drilling on the Breccia Ridge/South Ridge zone. Drilling will also target the Saddle zone.
Preliminary tests indicate silver recoveries of 95% to 99% via pre-treating by pressure oxidation, as some of the silver is refractory. Work to optimize the process continues.