Source Exploration (SOP-V) chases district-scale skarn mineralization at Las Minas
Oct 21, '14
Roughly 270 km due east of Mexico City in the state of Veracruz junior Source Exploration (TSXV: SOP) is thinking big. Earlier this year the company expanded a discovery at its 17 sq. km property package in the historic Las Minas mining district, and according to senior geologist Matt Laird exploration efforts have only "began to scratch the surface" of the project’s potential.
North-central Veracruz is thought to host one of the largest under-explored gold-copper skarn systems in Mexico. Copper-gold mineralization is typically localized in zones along the contact between the overlying limestone and intrusive rocks. Source's Las Minas project hosts a granitic intrusive that runs over 7 sq. km and a number of known mineralized skarns zones, as well as multiple epithermal polymetallic zones.
Thirty small-scale, high-grade mines operated in the district between 1870 and 1910. High-grade ore shipped from Las Minas to smelters graded from 15% to 30% copper and 20 grams to 40 grams gold per tonne, according to historic estimates.
In 2011 and 2012, Source carried out a geological mapping and sampling program over several of the concessions, including Pepe, Pepe Tres and La Miqueta. Subsequent drill programs have outlined two promising zones of mineralization — namely Santa Cruz and Juan Bran-El Dorado — where Source hopes to fast-track maiden resource estimates.
“It's all been very strategic from the start and that plays directly into why we chose Las Minas,” notes senior geologist Matt Laird during an interview. “We wanted to differentiate ourselves from exploration projects that were drilling some fairly good holes but not getting much reaction. We realized a lot of companies were holding value because they had resources, so we really wanted something where we could move into delineation drilling right away. When you walk into some of these old adits you can go for hundreds of metres in mineralized material.”
Santa Cruz is one of six priority drill targets at Las Minas and forms part of the El Dorado corridor skarn zone that has been intersected by diamond drilling for roughly 840 metres along strike and 400 metres down-dip, with mineralized drill intercepts varying from 20 metres to 245 metres in length. Source kick-started a second-phase, 2,000-metre drill program in late June that continued to yield promising results.
Santa Cruz is the higher-grade of the two targets, though much more geologically complex. Gold, silver and copper mineralization at the zone is hosted in retrograde altered endoskarn and exoskarn developed at the contact between the granodiorite and marble.
In early August, Source reported drill results from Santa Cruz that boast the best assay values encountered at the project to date. Hole LM-14-SC-08 cut 99 metres grading 1.64 grams gold, 7.63 grams silver, and 1.05% copper from surface, including a 10-metre interval averaging 10.6 grams gold, 48.5 grams silver, and 7.44% copper. Additional highlights include hole LM-14-SC-07, which intersected 87 metres of 1.17 grams gold, 4.7 grams silver, and 0.6% copper from 10 metres depth.
Meanwhile, drilling at the Juan Bran target 300 metres due north of Santa Cruz resulted in another discovery. Step-out holes to the north of Juan Bran intersected skarn mineralization over an area roughly 350 metres by 250 metres, with the system remaining open for expansion. The results effectively linked Juan Bran and El Dorado into a single zone and extended the flat-lying mineralized zone from 170 metres to 420 metres in width.
Highlights from the Juan Bran drill program include: 42.5 metres of 0.77 gram gold, 2.35 grams silver, and 0.48% copper from 132 metres depth in hole LM-14-JB-01; 20.1 metres averaging 0.87 gram gold, 3.76 grams silver, and 0.83% copper from 98 metres depth in hole LM-14-JB-02; and 13 metres of 0.32 gram gold, 1.17 grams silver, and 0.46% copper from 78 metres depth in hole LM-14-JB-07.
“It's actually a new area in between two drill holes completed in 2011 that hit some interesting high-grade material,” Laird comments on the El Dorado-Juan Bran drilling, noting that the underlying geology and mineralization are “identical.”
“We feel the recent program has really put it together. It's a single-contact skarn that’s basically a flat-dipping, highly-consistent zone. After doing work at El Dorado we think there could be pretty sizable resource potential there,” he adds.
Source is hoping to delineate around one million ounces of gold equivalent at Las Minas for a maiden resource estimate. Laird figures the company has invested around $750,000 in drilling thus far, and another $1 million could get it to a point where a maiden resource would be realistic.
“We need to come in and outline a resource to underpin the share price. But we haven't even touched the greater project potential,” Laird continues. “When I did my first site visit I thought: 'minimum a quarter of a million ounces with forty-five hundred metres of drilling.' I think we're looking at something big based on our activities to date.”
Thus far, Source has restricted its activities to the skarn-type mineralization exposed within the historic workings and through erosion on the the Las Minas valley floor. At higher elevations the project also hosts the potential for higher-grade epithermal vein deposits. The company is hoping it has a comparable to Torex Gold Resources' (TXG-T) Media Luna discovery.
Source notes that in both cases the mineralized skarn units are situated between structurally-competent marble and granodiorite rock units, with strong magnetic footprints correlating well with mineralization. Laird also says he sees similarities in the core he's studied from Media Luna when compared to Las Minas.
“When I look at Torex I see that on the same intrusion they have late, retrograde classic Guerreo gold belt oxide skarn, and on the other side they have Media Luna, which is a copper-gold magnetite skarn that's a totally different animal,” Laird explains. “I think our deposit is really close in terms of mineralogy and distribution, so I have to keep my eye on for that oxide type of skarn mineralization too.”
The company closed a $1.23 million non-brokered private placement in mid-May wherein in issued 10.3 million units at a price of 12¢ per unit. Each unit consists of one share and one warrant to purchase a share at a price of 20¢ through May 2019. Source maintains 74 million shares outstanding for a $6.3 million press time market capitalization |
