NEWS on progress!First Majestic reviews progress of silver projects
2004-10-04 05:38 ET - News Release
Mr. Keith Neumeyer reports
CORPORATE UPDATE
First Majestic Resource Corp. has released an update for its shareholders on corporate activities over the past couple months on the La Parrilla silver mine, Perseverancia silver mine and the Niko silver project.
La Parrilla silver mine
During the initial preproduction stage, which commenced in early July, the mill at La Parrilla began operations at 180 tonnes per day. The initial plan was to process above-ground stockpiles which remained on site from prior mining operations while new accesses within the mine were completed. To date, a total of 11,000 tonnes have been processed at the mill with an average grade of 241 grams per tonne silver and 0.3 gram per tonne gold for a total of 30,040 ounces of equivalent silver produced.
This stage identified a number of areas where low-capital-cost improvements were implemented to enhance production and recovery. In addition to previously announced items; four additional leaching tanks are planned, two are presently under construction and will be completed shortly; a new butter filter was constructed and now is in use to prevent slimes from passing into the press filter from the rich solution; and a new deaeration tower was put in place in August.
During the month of September, a temporary explosives permit was obtained in order to gain access to and develop the upper levels of the mine containing oxide material. A total of 35 metres were developed during the second and third weeks of September, gaining access to old stopes which are now producing ore in the range of 250 grams per tonne to 300 grams per tonne silver. Also the main Rosario vein has been reached and development is under way with the first 12 metres grading an average of 260 grams per tonne silver. To arrive at this average grade, four samples were collected from the back of the drift every three metres of development.
Further expansions and upgrades to increase production will continue to be implemented in the coming months.
Ramon Davila is the company's qualified person responsible for the supervision and reporting on this project.
Perseverancia silver mine
The company announced in Stockwatch on June 10 that it had entered into seven option agreements covering 283 contiguous hectares which included the Perseverancia silver mine, the Magistral mine and the Esmeralda mine. Since that time, First Majestic has added to its land position by entering into another similar agreement covering an additional 204 hectares covering the San Juan mine, which had a historic production in the range of 100,000 tonnes with an average grade of 450 grams per tonne silver as reported by the vendors.
A crew consisting of six geologists have been mapping and collecting rock samples from underground at the Perseverancia and within other drifts on the property since July. Eleven kilometres of grid lines have been established where a systematic soil geochemical sampling program was completed. A detailed geophysics survey to follow up anomalous indications from the geochemical sampling and mapping is anticipated to commence in mid-October along these same lines.
Lab results of 270 rock samples have now been received to date. Samples 1 through 60 were collected systematically from four levels underground at the Perseverancia, samples 61 through 196 were collected from other drifts within the boundaries of the 487-hectare property. The samples were collected and shipped to Laboratorios Geologico Minero S.A. de C.V. of Guadalajara, where they were prepared and shipped directly to Acme Analytical Laboratory's Ltd. of Vancouver. A summary of the silver results grading higher than 150 grams per tonne silver (Ag) are as follows:
Sample Ag Sample Ag Sample Ag
gpt gpt gpt
01 493 51 516 113 318
08 4,529 52 337 118 165
13 696 55 183 119 383
15 353 58 1,516 124 277
16 424 60 1,828 126 249
18 189 61 396 127 420
21 269 91 657 131 153
26 1,426 96 459 132 190
34 608 104 271 157 171
39 893 105 364 196 157
43 659 112 645
The soil geochemistry samples as well as other rock samples from surface and underground remain outstanding.
For the purpose of this news, the company has not reported values of silver grading less then 150 grams per tonne and has not reported other metal values. Further analysis of the data is presently under way to determine appropriate follow-up work and significance of these encouraging results.
Mr. Davila is the company's qualified person responsible for the supervision and reporting on this project.
Niko silver project
The drilling phase of the project was completed in late August for a total of 2,849 metres drilled in six diamond drill holes.
The drilling was primarily targeted on large CSAMT and NSAMT geophysical anomalies -- specifically resistivity lows. These were interpreted to represent massive polymetallic sulphides potentially containing silver, zinc, lead, copper and molybdenum.
No such bodies were intersected in the holes drilled to date. Instead, the low resistivity geophysical anomalies appear to be due to complex geologic factors not directly related to mineralization. Resistive zones appear to be related to solid, unbroken limestone and in some cases perhaps intrusive rock.
While the original objective of cutting significant mineralization has not been realized, the various geochemical and geophysical programs as well as this drilling program have confirmed that the Niko silver project has characteristics of a large hydrothermal system. Five additional drill targets remain to be tested. The company will be undertaking a detailed evaluation of the results and will be reviewing its options.
The Niko silver project is a joint venture between the company and Jaba Explorations Inc. Under the terms of this option agreement, First Majestic can earn up to an 80-per-cent interest by expending $900,000 (U.S.) on exploration over a three-year period and by completing a bankable feasibility study.
Jaba's James Briscoe, MSc, PGeo, is the company's qualified person responsible for the supervision and reporting on this project.
First Majestic continues to pursue other advanced stage silver projects in Mexico in accordance with its acquisition strategy. The company is in negotiations with a number of potential vendors. At this time, no agreements have been reached. These potential target acquisitions remain confidential in order for the company to maintain its competitive position.