El Misti Gold Ltd -
Sinchao project update; stock options
El Misti Gold Ltd EMG
Shares issued 21,324,643 1998-10-13 close $0.09
Wednesday Oct 14 1998
Mr. John Huguet reports
Santa Rosa
Work is proceeding on schedule with preliminary resource estimates completed and now going through cross checks. Process route has been determined based on the results and additional work continues. The schedule for completion is early November 1998.
Sinchao Project
Phase one of the 1998 Sinchao drill program consisted of seven reverse circulation drill holes totalling 1,174.5 metres and 10 diamond drill holes totalling 5,176.25 metres for a combined total of 6,350.75 metres. THe initial reverse circulation portion of the program consisted of 200 to 300 metre deep holes, but unfortunately only one was completed to depth. The company believes that because most of the sample recoveries from the RC drilling were below 50 per cent they are not representative samples. Recoveries for diamond drilling were generally above 80 per cent and thus can be considered representative.
El Misti had a quality assurance program, including third party independent geological verification in place for the entire duration of the diamond drilling portion of the program.
Four distinct styles of mineralization have been identified in the property as a result of geological mapping, RC and diamond drilling, and old workings. They are: massive sulphides as replacement lenses or mantos; a high sulphidation epithermal system; a copper-gold skarn under a large magnetic anomaly (1,300 x 900 metres); and, mineralization within and adjacent to a shear zone.
The massive sulphide replacement lenses or mantos, which formed along horizons within the limestone are in the southern sector of the property. In the Inquisicion pit area, eight RC holes were drilled in 1997. These holes intersected up to three lenses of massive sulphide with the largest being over 40 metres true thickness. Mineralization in the lenses consists predominately of pyrite and copper sulphides. Average grades from the eight RC holes was 0.29 g/t Au, 21.6 g/t Ag, 1.24 per cent Cu and 0.80 per cent Zn.
The high sulphidation epithermal system occurs under the Volare and Napoleon concessions with outcrops and old workings showing areas of hydrothermal breccias, veins and stockwork zones. Mineralization is mainly of pyrite and gray coppers. On the next drilling program diamond drilling will have to be done in this target zone.
The third style of mineralization at Sinchao is that of a copper-gold skarn within a large magnetic anomaly. Pyrite, magnetite and minor chalcopyrite occur as disseminations and irregular concentrations. Locally, over 5 to 10 metre wide sections of pyrite and magnetite form the only visible mineralization. Rare sphalerite and galena occur as visible less then 2mm subhedral crystals. Only drill hole SDH-6 was drilled close to the centre of the magnetic anomaly (1,300 x 900 metres). More drilling will be required to confirm the full potential of this large anomaly. Analytical results are still pending for hole SDH-6.
The fourth style of mineralization is that within and adjacent to a major shear zone that trends northwest through the centre of the property. It consists of disseminated pyrite with concentrations of sphalerite, galena, chalcopyrite and enargite hosted within shear zones and breccias. The elongated low resistivity (40 to less than 20 ohm/metres) anomaly (2,200 long x 250 metres wide) may be an expression of this style of mineralization since there is good conductivity, probably as a result of disseminated and or semi-massive sulphide mineralization. Diamond drill holes SDH-5, SDH-7, SDH-8 and SDH-10 have cut through this mineralized zone. Analytical results for 2/3 of hole SDH-7 and all of holes SDH-8 and SDH-10 are still pending. The following are results for hole SDH-5.
Interval Average Grade
From To Total Au Ag Cu Zn
(m) (g/t) (%)
Hole No. SDH-05
104 452 348 0.37 14.7 0.52 0.44
Incl.
230 294 64 0.50 21.2 0.75 0.92
and
316 452 136 0.41 17.4 0.73 0.05
Incl.
316 334 18 0.44 29.5 1.10 0.16
and
350 360 10 0.53 24.5 1.12 0.10
This fourth style of mineralization may have a large geological potential. It will be necessary to drill a phase II program with systematic holes every 100 metres along the strike of this mineralized shear zone. Also, at least two holes from every drill location in order to define the geometry and continuity of this mineralized structure.
The Sinchao property holds good possibilities for identifying economic mineralization within these diverse mineralized styles.
At present El Misti geological staff is preparing a complete geological report on the Sinchao property. It should be finalized once all drill hole analytical results are received.
PHASE I DIAMOND DRILL PROGRAM INFORMATION Hole Average Drill Depth Recovery Hole No. (m) (%) SDH-01(1) 125.05 71.00 SDH-02 629.70 86.00 SDH.03 492.00 78.00 SDH-04(1) 25.30 55.00 SDH-05 498.70 80.00 SDH-06 816.50 87.00 SDH-07 926.30 88.18 SDH-08 823.10 91.00 SDH-09(1) 158.60 78.00 SDH-10 681.00 88.00
1) Abandoned due to fault zone.
The private placement announced in Stockwatch Sept. 2, 1998 has had $215,000 received to date. The balance is yet to be received.
The company has granted incentive stock options to purchase up to 1,830,000 shares, exercisable for three years, at 15 cents.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com
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