Applying modern mineral exploration and mining methods in historic mining districts has been a recipe for success for many mining companies. Vast volumes of material which could never have been found, accessed or economically mined with small scale mining operations are now mined as high-grade ore throughout the country. This is the plan that one Canadian junior gold explorer is hoping to capitalize on in Mexico.
Mexican Gold Corp. (TSX-V: MEX) controls the entire core of the once-famous Las Minas historic mining district. The Las Minas project presently has two gold-copper deposits in advanced-stage exploration, and multiple high-quality, exploration targets. The project area features complete infrastructure, a highly prospective package of regional geology to allow for years of expansion opportunities. The project is fully permitted for drilling and up to date for federal and state environmental requirements.
On August 1, 2017, Mexican Gold Corp. tabled an initial Mineral Resource Estimate for the El Dorado/Juan Bran and Santa Cruz zones, two of the eight known mineralized zones at the Las Minas property.
The total Inferred Resource is 719,000 gold equivalent ounces contained within 10,304,000 tonnes grading 2.17 g/t Au Eq. The total Measured and Indicated Resource is 304,000 Au Eq ozs contained within 4,970,000 tonnes grading 1.90 g/t Au Eq. The resource is largely pit constrained, with 13,868,000 tonnes contained within a pit shell. The weighted average grade of the open pit resource is 2.00 g/t Au Eq. The underground total measured and indicated resource is 1,183,000 tonnes grading 3.00 g/t Au Eq.
The company has been drilling to extend and expand the resource at other Las Minas zones with a 3,000-metre drill program that just completed which will go a long way of increasing the amount of known mineralization.
Highlights from the 2017 and 2018 drilling campaign include:
- Hole 40 cut a cumulative 94.35 meters of high-grade mineralization over three zones. The main zone graded 9.24 g/t Au Eq over 38.0 metres contained within 54.0 metres grading 6.91 g/t Au Eq.
- Hole 49 in the Eldorado zone intersected 38.0 metres grading 10.19 g/t Au Eq (4.51 g/t Au, 16.17 g/t Ag, 3.33 % Cu) contained within 46.0 metres grading 8.81 g/t Au Eq (3.87 g/t Au, 13.81 g/t Ag, 2.90 % Cu)
These results have created some strong market activity and has pushed the shares in Mexican Gold from its year low of 19.5 cents to a year high of 44 cents. These results demonstrate that there is more than in the ground and the potential to significantly improve the size and confidence of the resource. The Neuvo Pueblo zone will be the new target for drilling once the ground work is complete.
MiningFeeds.com had a chance to sit down with CEO Of Mexican Gold, Brian Robertson, B. Sc. P.Eng, to discuss the company’s plan going forward and his thoughts on the markets and gold.
MiningFeeds “MF”: How do you come into Las Minas?
Brian Robertson “BR”: It is an interesting story. I was working on a silver property that I had under option in Zacatecas and while talking to the owner he introduced me to the Las Minas property. I read the geological report on Las Minas he provided and was very impressed. When I did a site visit, the extent of the skarn mineralization, favourable geology, and large number of historical small scale high-grade mines in the area really impressed me. I immediately made the arrangements to option the property as well as the adjoining Neuvo Pueblo property.
MF: What is the work that has been done to date?
BR: We have drilled approximately 26,000 metres to date, including 16,764 metres of resource drilling at the El Dorado/ Juan Bran zone for the initial resource estimate. We have just completed 6,000 metres of drilling to expand the resource. We have also done some exploration drilling on numerous zones. None of the additional drilling is included in the resource estimate.
It is not a lot of metres for a one million ounce deposit, but it is close to surface and consistent in the mineralization. With a small number of metres you can drill off a significant resource, which was done.
MF: What are some unique characteristics of mining in Veracruz?
BR: This part of Mexico is underexplored but it is showing great potential, which is starting to be recognized because of the work we are doing at Las Minas.
We have very good relations with the people at the small nearby village of Las Minas. We operate with the underlying principle that we are a guest in their community. We employ a number of people from Las Minas, and our Mexico office is in the village, which creates a lot of daily contact. We also employ a number of people from Las Minas, and have worked with our drilling contractor to train local people as diamond drillers. We make donations to the schools, sports organizations and the community. We work very hard and building and maintaining good community relations.
The Las Minas area is very safe. We have not had any safety related issues working there over the last eight years. In fact, contract diamond drillers working at Las Minas regard it as one of the safest areas in Mexico or Latin America. The surface land rights are largely privately owned, and we own the surface rights for the Santa Cruz deposit. This simplifies the land ownership and surface access arrangements.
Las Minas is a historical mining town, so the people living there view mining positively and see it as an opportunity for employment and bring prosperity to the community.
MF: What are the upcoming plans?
BR: The plan going forward is to expand the resource and carry out field exploration of other under explores areas. The results will go towards an updated resource. There is considerable potential with resource expansion as our grades are well above the average of other open pit mines in Mexico, which are typically around 1 grams per tonne or less . We are coming in around 2 grams, which is a very high grade for an open pit mine .
MF: What do you think Gold needs to get going?
BR: Smart money is quietly coming into the gold sector but the retail investor is still hesitant about investing. What is required to bring investor interest back into the gold sector is another strong upward push of the gold price . We need to see a significant devaluation in the US dollar in order to get gold equities going again.
MiningFeeds would like to thank Brian Robertson for his time and insights into Mexican Gold (TSX-V: MEX).
Mexican Gold trades under the symbol MEX on the TSX Venture. The company has ~38 million shares outstanding and at time of publication shares in the company trade at 31.5 cents. Institutional Investor Palisade Global Investments w/ ~$40 M AUM increased their position to 18.79% The company just recently closed a financing of ~$1 million dollars and is well financed to do further exploration and follow up on the strong results it has already produced in 2018; there will be more.
Mexican Gold Corp.