Capitan Mining Inc. (TSXV: CAPT) has received results from six reverse-circulation (RC) drill holes from the Capitan Hill oxide-gold deposit, at its 100%-owned Peñoles project in Durango, Mexico.
Management also report that after several months of negotiation they have entered into a purchase agreement to acquire a portfolio of royalties including a 2% royalty on the Capitan Gold oxide deposit from Exploraciones Altiplano.
Highlights:
- Drillhole CARC 21-48: returned 35.1m of 0.42 g/t Aueq including 4.6m of 1.1 g/t Aueq
- Extends mineralization 170m down-dip from hole 21-CARC-25 on cross section -100
- Royalty Buyback: Total purchase price of royalty portfolio is US $1.0M over two years, payable in cash and shares
- The Altiplano royalty portfolio included a 2% net smelter royalty (NSR) on the Capitan Hill oxide-gold deposit
- Any shares issued to Altiplano are subject to right of first refusal (ROFR) allowing Capitan to market and place shares with investors if Altiplano elects to sell
- This transaction with Altiplano in combination with Capitan’s contractual option to retire Riverside Resources 1% royalty for C$250,000 will leave the Peñoles project royalty free and will enhance overall project economics for investors
- Drilling to resume in late January following holiday break
- Assays for 11 drill holes are pending
Central and Southeast Step-out Holes
Holes 21-CARC-44, 46, 47, 48 and 49 tested the down-dip extension of the Capitan zone in the central and southeast portion of the deposit, to extend both the Capitan main and Hanging wall zones to the south.
Hole-21-CARC 48, was a 170m step-out on section -100, and was successful in extending mineralisation on that respective section. The hole returned several, narrow, low-grade intervals over the first 200m of the hole, similar to adjacent holes that are on-strike and up-dip.
Of particular significance, the hole returned the highest-grade interval to date in the southeastern portion of the Capitan deposit returning 35.1m of 0.42 g/t Aueq, including 4.6m of 1.1g/t Aueq.
This interval occurred just before the hole terminated and is the deepest intersection of higher-grade mineralisation to date at Capitan Hill. This intersection also supports the hypothesis that the holes above, may not have been drilled deep enough (zone was displaced to depth), given the position of mineralized interval in hole 21-CARC-48.
Holes 21-CARC-44, 46, 47, and 49 were large step-out holes located on sections 100, -250, 200, and 000 respectively. These step-out holes were drilled between 75 and 175m down-dip from the previous holes on their respective sections. In general, these holes returned relatively narrow, low-grade intercepts that did not correlate well with mineralisation returned in previous drilling located up-dip.
Given that the holes above were all drilled in the same vicinity as one another, it is interpreted that there may be some displacement of the main zone down-dip, possibly related to the Santa Theresa fault, which the holes crossed before they reached their target depth. Of note: the above holes were terminated due to the depth capacity of the rig, and ground conditions.
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