South American Silver Corp. announces the results of a 5 hole diamond drilling program and the interpretation of the ZTEM Conductivity and Magnetic geophysical surveys at the Escalones copper-gold project, approximately 100 km southeast of Santiago, Chile and 35 km east of El Teniente, the world’s largest underground copper mine. Escalones, as previously announced and supported by a NI 43-101 technical report, contains a defined Inferred Resource of 420 million tonnes of mineralized material containing 3.8 billion lbs of copper, 56.9 million lbs of molybdenum, 610,000 ozs of gold and 16.8 million ozs of silver using a 0.2% Cu Equivalent cut-off grade (see December 19, 2011 News Release). The detailed NI 43-101 Technical Report is available on SEDAR under the Company’s profile and on the Company’s website at www.soamsilver.com.
The Escalones property lies within the well-known central Chilean porphyry copper belt that runs north-south through Chile in the central Andes Mountains. It is located approximately 100 km southeast of Santiago and 35 kilometers due east of El Teniente, the world’s largest underground copper mine. The project has excellent infrastructure including road access and a gas pipeline that crosses the 70 square kilometer property.
The Escalones project hosts a four-square-kilometer area of hydrothermal alteration with coincident geophysical anomalies that has demonstrated significant grades of copper, gold and silver in replacement-style “skarn” mineralization hosted in limestones and in porphyry related mineralization.
Diamond drill hole ES-35, located 300 metres E of ES-24, intersected 71 metres of near surface, oxide copper mineralization averaging 0.64% copper equivalent (“CuEq”). This near surface mineralization correlates with a ZTEM conductivity anomaly which is approximately 500 metres wide and at least one km long. Drill testing, starting when the snow clears in November, will further test this target. ZTEM is a geophysical tool that helps to identify mineralized areas that are conductive.
Diamond drill hole ES-35 also intersected high grade skarn mineralization at 456 metres intercepting 4.5 metres of copper mineralization averaging 4.32% CuEq within a 9.25 metres zone averaging 2.39% CuEq. A copper skarn is a carbonate rock that has been “cooked” and mineralized by the heat and fluids from nearby copper bearing intrusions. Examples of copper porphyry plus skarn deposits include the well-known Bingham Canyon Mine in Utah and the Twin Buttes Mine in Arizona.
The skarn at Escalones has now been traced by drilling approximately 1.7 km horizontally and 1.1 km vertically. A large magnetic anomaly is associated with much of the known skarn mineralization and this anomaly extends several hundred meters further to the north of the drilled area, at least 500 meters to the south and approximately 500 metres further east. The anomaly also extends to a depth of several km, many hundreds of metres below the level of current drilling.
Ralph Fitch, Executive Chairman, stated “This is the first time we have located a good thickness of near surface copper oxide mineralization at Escalones. The importance of this type of mineralization is that it is often the least expensive type of copper to recover because it is typically heap leachable. If future drilling shows that this zone is extensive it will be an important new body of mineralization that is not in the present resource. This new zone combined with that found on the west side of the property in holes ESC-26 (email@example.com% copper) and ESC-28 (firstname.lastname@example.org% copper) represents an important part of the mineralized system found to date at Escalones because of its likely low cost leachability. Also, the deep skarn intercept is important, both because of its grade and also because it demonstrates the huge column of copper mineralization present at Escalones which extends from surface to depths of greater than one kilometer. Our upcoming drill program will start to convert this vast column of mineralization into a resource.”
Upcoming Drilling Campaign
Up to 30 holes are planned to confirm and expand the resource in the 3 categories reported previously, oxide/sulphide, skarn and porphyry. The results from this drilling will be combined with earlier results and an updated resource will be developed and reported in compliance with NI 43-101.
The true thickness of the intercepts reported is not known at this time.
Magnetic susceptibility anomalies are only an indication of the presence of the skarn mineralization and the reader should not assume that “ore grade” mineralization will be intersected.
ZTEM conductivity anomalies are only an indication of the presence of mineralization and the reader should not assume that “ore grade” mineralization will be intersected.
Samples were analyzed by Andes Analytical Assay Laboratory located in Santiago, Chile. Gold was analyzed using fire assay and the AA (Atomic Absorption) method while silver, copper, gallium, indium, molybdenum and 38 additional elements were analyzed by ICP AES HF43 method with a four-acid digestion. The copper equivalent has been calculated using the following prices: copper $3.50/lb, gold $1,600/troy oz, silver $30.00/troy oz, molybdenum $11.00/lb, lead $0.90/lb and Zinc $0.90/lb. Values have not been adjusted for metallurgical recoveries.