I am encouraged by this comment near the end of the last NR:
"Furthermore, the Company is pleased to announce that Hole TA 17.5-07, drilled below TA 17.5-06 to explore the stockwork zone approximately 60 to 100 meters deeper then the original zone, has encountered the same geological units over similar width of approximately 30 meters at depth. Assays are pending." - ENDQUOTE
This is absolutely huge news, and I will explain why. The last data from the stockwork when they originally reported the discovery, came in the NR from May 18th:
"Drill hole TA 17.5-06 was a step-out hole whose primary purpose was to provide data to confirm the continuity of the stockwork zone, both laterally and vertically. We are pleased to report that the zone to this point (see table 1-A below) encountered grades of 1.21 g/t Au and 36.8 g/t Ag over a core length of 41.58 meters (true thickness of 31 meters). As stated in our last press release, this new zone on level 17.5 is perfectly shaped for large-scale bulk mining and this latest data provided the base to calculate a first resources block (80 meters long, 120 meters high and 29.6 meters thick) containing approximately 800,000 tonnes or sufficient material to feed our current mill at 8,000 tonnes per month for more than 8 years. The drill will continue with further step-out holes as a priority of the current exploration program because the Company strongly believes that the area to be defined is much larger." - ENDQUOTE
So they know they have a zone right at the edge of their currently developed workings that is suitable for bulk mining methods, that was estimated at about 800,000 tons of ore grading 1.21 g/t Au and 36.8 g/t Ag based on that one interval.
Now we find that they have extended this stockwork zone for another 60-100m of depth. Assuming that the grades remain relatively consistant, they have added about another 50% to the total depth of the deposit, or about another 400,000 tons of this economic mineralization. Or, in terms of mining life, they just demonstrated evidence of yet another 5 years of ore to feed the mill, on top of the 10 years supply just from that one zone, and roughly 10 years of feedstock identified in the near surface veins proven so far.
This is as clear an indication as we can expect to see that the company will be upgrading their processing plant capacity. They could now increase the mill to over 1000 tons per day, and still have a ten year mining life, assuming they did not find one new ton of ore going forward. And then considering that they still have not even tested some of the veins at surface, and still have not added any resource from the skarn zone at depth, which will likely amount to tens of millions of tons of ore on its own, then you have an idea of just what kind of production potential ECU represents.
To see that some analysts still consider the company a 'mom and pop, small scale operation' is enormously bullish. When the steady stream of drilling data continues to hit the markets, eventually the light will go on and there will be new buyers motivated to get into this story. That will be the trigger that will bust ECU out of the current trading range which has allowed players to dump paper and then wait for it to dip back below $3 to recover.
The future is very bright, and this company presents the least discovery risk of any junior in Mexico, IMHO...
Cheers!
COACH247 |
