Canaccord Capital Daily Letter - 20Dec99
PFG holds the option to earn a 100% interest in the Luicho project, which is located about 450 km. south of Lima at an elevation of between 1,700-2,900 m in a topographically difficult territory. The property has evidence of past superficial mining from numerous short adits. There has been no detailed work on the property in the past 40-plus years. The target area is at least 1.5 km. by 150 m, ranging up to 400 m wide with an apparent vertical exposure of at least 300 m. Within the target area some 431 surface and underground samples have yielded an average grade of 1.57 g/t Au. The greater concentration of the sampling lies within a 500 m by 200 m area where 271 samples graded an average 2.36 g/t Au. Recent sampling of an old adit located some 250 m south of the Main Target area yielded much higher grades than the average reported to date. Over 34 m, on 2.0 m panel widths, the interval graded 10.03 g/t Au and 147.5 g/t Ag. We understand that the cumulative lowest and highest grades within each 2.0 m panel were 3.0 and 17.0 g/t Au, respectively. This is important in that it continues to provide evidence of broad mineral dissemination. The company also reported further sampling from the southern portion of the Main Target where, again, the grades are higher than the previously reported average grades of 17.25 g/t Au and 26.8 g/t Ag over 32 metres. While we don?t expect these grades to hold up as averages for the prospect, each demonstrates that high-grade pockets are very likely which certainly could enhance the bulk-mineable potential of Luicho.
In Luicho, Pacific Rim has acquired an option on a property that, in the current gold market environment, represents one of the better early-stage targets that we have recently seen. The company has sufficient current working capital of C$4.5M to drive through the planned first phase of exploration drilling (some 12,000 metres) to begin in Q2/00. This target provides the geological potential for a 5.0M-plus ounce discovery. SPECULATIVE BUY. |
