THis is a bit old but a good readfor those who are new to Azteca
David Bond, Editor
The Silver Valley Mining Journal
Going for the Brass Ring
Wallace, Idaho - The saga of perhaps the greatest ore discovery in the Coeur d'Alene Mining District since Noah Kellogg found Bunker Hill 125 years ago, or since the Wenatchee apple-knockers backed into the Chinatown Stopes at the Sunshine Mine 80 years ago, is unfolding in a series of five geeky press releases issued by Azteca Gold since 8 December of last year.
Azteca's drilling on Royal Apex Ventures' Two-Mile property just west of Wallace already describe a Bunker Hill-sized massive sulfide deposit, the vein of which runs at least a kilometer east to west and, like the crest of a giant wave, gets closer to the surface the further west one looks.
The only two guys who seem completely unsurprised by the spectacular results - assays of 10- to 40-ounce silver inside a zone of 40 percent zinc and 5 oz/tonne of silver along a 15.5-foot width inside an 85.5-foot vein of 9.2 percent zinc and 1+ oz/tonne silver are Justin Rice, Royal Apex's CEO, and Matt Russell, Azteca's CEO. Both, for independent and separate reasons, would have been far more shocked were there not the grades and bulk Azteca's three deep surface drill rigs are turning up.
Rice, who turned 90 last 4th of July, knew from work decades earlier when he was chairman and CEO of Coeur d'Alene Mines that there were mineable quantities of silver-bearing high-grade sulfides on the north side of the Osburn Fault on the Royal Apex ground, and had he remained at Coeur, the company would have returned from its success at Rochester in Lovelock, Nevada to the Coeur d'Alene District to build a mine on the property.
Russell, who is half Rice's age, put himself through college working in the mid-1980s at the Galena Mine spitting distance across the Osburn Fault from Two-Mile, and reads esoteric geology research over his Wheaties every morning, came across a mid-1960s USGS report theorizing that underlying the Coeur d'Alene District's legendary veins of silver, lead, copper, and zinc, and Prichard's equally legendary placer gold find near Murray, was a magmatic structure that was the source of all this stuff. The paper confirmed Russell's own hunch that the source of the district's veins was magmatic, and close by.
The first (and easternmost) hole they drilled last summer was 8,784 vertical feet - by far the deepest hole ever poked from the surface in this district, ending up a mile below sea level from its collar at 3,650 feet above sea level - and it encountered the massive at 7,950 feet after passing through intermittent stockworks veining that began at the 7,500-foot depth.
("Stockworks" and "feeder zone" are geologists' geek terms for what those old-time Western movie prospectors called "the Mother Lode.") It's the solid chunk of stuff that tosses out those miserly crumbs most miners are happy to pick up.
They backed the drill out to 4,000 feet, wedged the hole at that depth, and sent the drill careening west to see what it could find. Russell anticipates hitting the massive zone at a similar depth as the first mother hole, as the wedge-off will only be a few hundred feet west of the mother hole by the time it reaches depth in the next couple weeks. This wedge-off hole is meant to start blocking off mineral reserves, which Matt has declared a major goal of his drilling program during 2009.
On 13 January of this year, Azteca announced its massive zinc, lead, and silver find to the markets, which greeted the news with a thunderous yawn. In the midst of the ramp-up to Obama's inauguration, and the cavalcade of thieves, liars and crooks from the financial sector being interrogated by the cavalcade of thieves, liars and crooks in the United Snakes Congress, the markets were too overwhelmed to notice something as trivial as a Comstock-sized find in a little mining-friendly district in Idaho.
Matt Russell could care less. He's been mopping up his own company's stock for his personal account as fast as he can, and just recently called in higher-priced warrants for below AZG's CAN$ 0.17 current share price so he can add a third drilling rig on the Azteca-Royal Apex joint venture. (Royal Apex, we are told, will be going public soon as well.)
"I'm only interested in primary systems, in stupidly high-grade ore. It changes the scale of the mining operation. If you're just going after the ultra high-grade you can get by with a smaller mill, smaller hoists and haulage-ways, because you're not wasting space and money moving waste rock," Russell told us over coffee at the 1313 Club in Wallace last week.
For every USGS report suggesting the possibility of magmatic, primary ore north of the fault, there was another insisting it's barren as a whore's heart. Those words, to Matt Russell, were nothing short of a dare. "When you tell a Russell there's nothing there, you might as well be telling him to go for it. It's like telling a two-year-old, 'Don't do that.' He doesn't hear the 'Don't.' He just hears, 'Do that.'"
All of which more than compensates for the perceived problem of mining depth, which may not be a problem at all if what Russell and Rice are calling the Harlow Vein (Harlow Rice, Justin's father, first worked the property a half-century ago) apexes near the surface somewhere west of where they're drilling now. Azteca drilled a shallow hole last year through the Harlow Vein and dump, and reported an intercept of 47.4-ounce silver near surface. On their second deep hole, located one kilometer west of DH-005, they hit disseminated mineralization at around 2,300-feet and intermittent "stockworks" veining at 3,575-feet. If it's the same system, that would make it more than 3,000 feet shallower that the first hole a kilometer to the east, and would also indicate that they are closing in on the projected depth of the massive sulfide zone which lies beneath the stockworks. Hecla anticipates mining at 9,000-foot depths at its Lucky Friday mine seven miles east of Wallace, so what Azteca and Royal Apex are finding is, comparatively speaking, just below the daisies.
Russell, who has pitched a tent near the drill rigs for the past several weeks and paces the ground near the core boxes like a little kid on Christmas Eve - going home only on the weekends - keeps a tight lid on the rumour mill. But word has leaked out of sizable quantities of gold and silver amidst the sulfides. Asked about such tales, he grinned a Cheshire cat grin and said, "Every silver mine in this district has had gold in it." Enough said. We can connect the dots. One would presume that the third drill rig, when mobilized, will be set up some distance further west again where the "crest of the wave" might lie.
As for 90-year-old Justin Rice, who can be found holding a robust court mornings at the Red Light Garage in Wallace with a big cup of java and a gigantic oaf of a yellow lab named Tameus wagging a tail that could break plate glass, the Two-Mile find, a foregone conclusion to Rice a half-century hence, is a splendid vindication. Rice brought Coeur d'Alene Mines from penny-stock to NYSE thunderbuck four decades ago with his hunches about the Coeur Mine, and the Rochester. As CDE sinks back to Pink Sheet status for its adventures in Bolivia, this third time will be a charm for him.
We turn on CNBC or Bloomberg most mornings, just to find out what the Enemy is thinking, and the Smurf chatter is turning somewhat, er, nervous. United Snakes deficits are approaching Planet Earth's GDP, even as a Fed governor insists Bernanke keep the printing presses running on hyperdrive. The word "trillion" is bandied about as if one understands it. Guys like Peter Schiff are getting air time as the Dow craters. ("Try to remember, the lows of November . . .") There is talk in the mainstream media of a return to a gold (and by default, silver) standard as the only means to straighten out this monetary mess. The Smurfs are running out of alternatives, as are the publicly-held United Snakes Congress and the privately-held Federal Reserve Bank. As Bernie Madoff discovered, even the best-slimed Ponzi schemes eventually run their course. The several states are confiscating money righteously earned by their citizens, by denying them refunds due on their confiscated withholding taxes.
Russell and Rice should let this scribe handle their PR for them. To hell with stock exchange rules. Our first press release would not have led with some geek-speak about holes wedged off or sampling splits or disclaimers about how all miners are liars. Instead, it would have gone like this:
"Wallace, Idaho - A heretofore unknown stash of several trillion 'old money' dollars was discovered recently in the mountains of northern Idaho. 'This money, if mined, would be sufficient to retire most of the National Debt and restore America to fiscal integrity,' enthused United Snakes President Barack Obama. 'It will also put some guys to work, which I am for,' Obama continued, adding 'With the taxes from their wages we will repave the Beltway in gold."
Yes, the Two Mile find is that good. Buy while nobody's looking, same way Justin and Matt and their family members are buying. There is a choice in your life here, and it is yours to make: Things can get worse, or things can get better. Your call.
DISCLAIMER: I own 17,000 shares of AZG, currently valued at about US$2,500. I intend to own a whole bunch more as circumstances permit. Neither the Coeur d'Alene District, nor Justin Rice, nor the Russell family, has ever let me down.