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Gold/Mining/Energy : El Misti Gold Limited (EMG V) -- Ignore unavailable to you. Want to Upgrade?

To: robert b who wrote (217)	6/12/1998 1:24:00 PM
From: Ron Baxter	Respond to of 513

El Misti Gold Ltd - Sinchao recommendations; clarification; director resigns El Misti Gold Ltd EMG Shares issued 21324643 1998-06-10 close $0.8 Friday Jun 12 1998 Mr. Robin Slaughter reports SINCHAO DRILL PROGRAM - SAMPLE QUALITY Recommendations have been received from independent consultants to enhance sample quality at the Sinchao project. The independent consulting geologists, Howe Chile Limitada, has recommended the use of HQ3 and NQ3, which comprises a dedicated third tube in the diamond drill core barrel, to ensure improved recoveries. Howe Chile Limitada is preparing a summary report for distribution. Bradley is now equipped and drilling HQ3 core. Andes and Major Drilling will start their next hole with HQ3. This action should ensure maximum recovery of undisturbed core, except where water and air are encountered. The heavy ground water flows encountered which could have dissolved friable samples and made the use of reverse circulation drilling questionable and to some extent diamond drilling, (if not equipped with HQ3 or NQ3) would be less representative. Reverse circulation drilling was terminated on May 8, principally because target depth was not being achieved and low sample recoveries. The company is committed to an independent verification program which ensures that representative samples are collected from the drilling program and that the assay results from truly representative samples can be relied upon. DRILLING CLARIFICATION AND UPDATE Four diamond drill holes are in progress. Hole 2 (Andes) is at 629.7m and has been completed. Hole 3 (Major) is at 425m depth with a bearing of 45 degrees and dip of 75 degrees. Hole 5 (Bradley) is at 405m with a bearing of 180 degrees and a dip of 60 degrees. Hole 6 (Major) is at 535 depth metres at a bearing of 45 degrees at a dip of 65 degrees. All holes have intersected altered volcanics and porphyry containing sulphide mineralization and the magnetite content varies from zero to five per cent. The company anticipates having the first drill assay results from the diamond drill program ready for release by the end of June. Holes SDD-2 and SRC-17 were drilled on a bearing of 135 degrees east of north parallel to the mineralized structures in the near vicinity. As reported in the June 4 news release (Stockwatch June 8) the preferred drill orientation now is a bearing of 180 degrees to 235 degrees east of north dipping at 60 degrees to 75 degrees. Based upon the geophysical interpretation and the 12 holes drilled in 1997 the drill target is large. From the viewpoint of the geological model the mineralized structures appear to be of the same orientation as the interpreted regional structure. The drill samples received indicate that the volcanics are associated with a mineralized porphyry system (or systems) at depth. Drilling to date is part of a continuing drill program, which will provide the data to prepare an independent resource calculation in accordance with National Policy Guideline 2A. No independently verifiable mineral resource exists at Sinchao. The potential mineralization and the values reported per tonne disclosed in the Jan. 23 news release (Stockwatch Jan. 27) were stated as a drill target and do not represent a mineral resource. The then stated potential tonnage and value per tonne numbers were from a limited number of drill holes and should not be interpreted as representing the value of the mineralization discovered at Sinchao from drilling. Accordingly the 64 page in house report prepared by chief geologist Victor A. Jaramillo on the Sinchao property as announced in the Jan. 23 news release (Stockwatch Jan. 27) has been withdrawn. The company will seek the return of all copies distributed. To prove the existence of an ore body, a feasibility study would need to be completed which demonstrated an independently verifiable mineable reserve, where the estimated capital cost of the mine development yielded an investment return in excess of 10 per cent per year after tax from projected mine production. SAN NICOLAS MINE OPTION Metallurgical test work completed by Bactech in Australia has demonstrated the San Nicolas sulphide material is amenable to bacterial oxidation. The as received underground samples gave a total copper release of 79 per cent, zinc 53 per cent for a 51 per cent sulphide oxidation level. The test allowed to continue to maximum oxidation indicated 92 per cent copper, 85 per cent zinc and 83 per cent sulphide oxidation. Cyanidization of gold and silver without bacterial oxidation resulted in precious metal recoveries of 28 per cent for gold and 30 per cent for silver. Cyanidization of the partially oxidized residue resulted in significant recovery increases: 52 per cent for gold and 79 per cent for silver. Further test work and economic evaluation is recommended. Directors The board has regretfully accepted the resignation of George Milton as a director. Mr. Milton's current residence makes it difficult for him to discharge his fiduciary obligations. Mr. Milton will continue on as a consultant to the board in financing matters. (c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com For what it is worth here is the release.