Equus Mining (ASX: EQE) is poised to begin phase two greenfields diamond drilling at its flagship Cerro Bayo project in Chile late this month.
The program will focus on high grade gold and silver targets within a district that has so far produced 45 million ounces of silver.
Phase 2 will involve 1,500m of drilling to target beneath and along strike from previously reported silver-gold intercepts at the Droughtmaster prospect.
One of those previous holes returned 3.81m at 20.4 grams per tonne gold and 55.5g/t silver from 109m, including a section of 1.06m at 62.58g/t gold and 129.3g/t silver.
Another hole intersected three separate zones: 0.64m at 1.44g/t gold and 240g/t silver; 0.62m at 17.28g/t gold and 271g/t silver; and 1.10m at 5.32g/t gold and 43.1g/t silver.
Equus is also finalising generation of “high potential” brownfields drill targets which are along trend from several key historical production sites — and all within 2km from the project’s turn-key processing plant and infrastructure.
The company has an option with Toronto-listed Mandalay Resources to acquire all the Cerro Bayo mining properties, resources and mine infrastructure, including a 1,500t per day processing plant which is now on care and maintenance.
Nine historical high-grade mines within project area
The area has been subject to several mining phases, including by silver giant Coeur d’Alene (now Coeur Mining, which is listed on the New York Stock Exchange).
Between 2002 and 2008, Coeur mined 2.58Mt at 4.2g/t gold and 346.7g/t silver to produce a total of 348,424oz of gold and 28.76Moz of silver.
Metal prices then were a world away from the present levels: in Coeur’s day, the average gold price was US$528.87/oz and silver US$9.07/oz.
The mining then was initially from the Taitao open pit, followed by underground operations.
In all, nine historical mines were located within the Cerro Bayo project area and were significant high-grade producers, with Cerro Bayo so far having yielded 650,000oz of gold and 45Moz of silver.
In May, Equus completed 1,385m of drilling at the Taitao pit to confirm historical data. This, together with drill data generated by previous owners, has provided the basis for a JORC resource statement and a mine re-start study.
Drill results comprised 19m at 1.26g/t gold and 10.0g/t silver, mineralisation being hit at 68.5m below surface; this hole included 9.6m at 1.93g/t gold and 12.3g/t silver.
The next hole drill returned 12.5m at 1.45g/t gold and 30.9g/t silver from 36.8m.
Cube Consulting has been engaged by Equus to undertake the JORC resource task at Taitao and adjacent greenfields mineralisation, with that work to be completed in the current quarter.