- PROPERTY DESCRIPTION AND LOCATION
The La India project is located in the Mulatos District, Sonora State, Mexico approximately 220 kilometres southeast of the city of Hermosillo. A number of gold deposits have been identified in the Mulatos District. The project is accessible by road. The first 150 kilometres is via a paved road to the village of Arivechi located 15 kilometres southeast of Sahuaripa. The remaining distance (approximately 70 kilometres) is on a gravel and dirt road. The road beyond Arivechi provides access not only to the property but also to Alamos Gold's Mulatos deposit and thence into Chihuahua State.
The property is in the Sierra Madre Mountains of eastern Sonora. The topography consists mainly of long ridges separated by steep V- shaped valleys. Elevations range from 1200 metre ASL to over 2000 metre ASL. The climate in the area is semi-arid with variable seasonal temperatures ranging from 25 degrees C in the summer and 10 degrees C in the winter, with occasional frost at higher elevations. The area experiences torrential rainfall occurring from July to September and the driest months being March to May.
Vegetation in the area is varied. Generally, vegetation at higher elevations consists of open pine forests while oak and cedar forests predominate at lower elevations. Poor soils and inconsistent precipitation limit the viability of farming in the area.
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- OWNERSHIP
The La India project consists of 18 Mining concessions covering in aggregate 24,515 Hectares. Concession information is summarized in the table below. The claims are currently controlled by Resource Grayd de Mexico SA de CV (Grayd) by means of six separate agreements whereby Grayd can earn a 100% interest by making cash and share payments. The claims are all subject to 1-3% royalties but these can be bought back to 0.5- 1%.
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- GEOLOGY AND MINERALIZATION
The La India property is located in the northern portion of the Sierra Madre Occidental physiographic province of Northern, Mexico, a 1200 by 300 km northwest trending belt of Tertiary volcanic rocks. The northern Sierra Madre Occidental hosts some of the largest gold deposits in Mexico, including the 3 million ounce Mulatos deposit and the 2.5 million ounce Dolores deposit.
The La India property lies near the northwest end of the Mulatos Region, a 15 to 25 km long belt of strong hydrothermal alteration and gold mineralization. The targets at the La India project are volcanic-hosted, high-sulphidation epithermal gold deposits amenable to open pit mining and heap leaching, and gold-quartz veins occurring along the margins of dioritic intrusions. The property covers the northwest end of a large hydrothermal system that is characterized by intense argillic alteration and silicification. The geology, alteration assemblages and surface gold mineralization are consistent with those at the Mulatos deposit located 6.5 kilometres away, which has a resource of 3 million ounces Au.
Andesitic to rhyolitic extrusive volcanic and volcaniclastic rocks underlie most of the property. Locally dacite domes, porphyritic rhyodacites, and equigranular to porphyritic diorite and quartz diorite intrude these rocks. Northwest and northeast trending normal faults are abundant in the district and have inferred offsets ranging from 10's to 100's of meters. Graben type structures preserve young post mineral rhyolite and basaltic andesite in the west and northeast portions of the property.
The package of andesitic to rhyolitic volcanic and volcaniclastic rocks and all of the intrusive rocks have undergone varying degrees of hydrothermal alteration, ranging in intensity from weakly propyllitized or argillized, to intensely acid leached and strongly silicified. Structurally and stratigraphically controlled zones of massive and vuggy silicification occur within a northwest trending zone over 10 km long by 2.5 km wide. Individual zones of silicification are exposed over areas up to 2 km by 0.5 km. Alteration surrounding massive and vuggy silicification is zoned, with narrow zones of advanced argillic grading outward into argillic then propyllitic alteration.
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- DESCRIPTION OF MINERALIZED ZONES
Viruela - La Cruz - Cerro de Oro Zones
The area includes the La Cruz, La Viruela, Viruela West, Cerro de Oro and Esmeralda gold showings. They are comprised of fault controlled, northeast trending zones of quartz-alunite alteration hosted by andesitic tuffs, dacitic tuffs, and dacite porphyry. Locally, auriferous hydrothermal breccias are developed along high angle faults and they appear to post date all other alteration and mineralization events. The silica-alunite alteration zones are continuous for hundreds of meters along strike, but have been offset by northwest striking high angle normal faults. Widths exposed on surface are as great as 100m. Rock chip sampling indicated that the outcropping alteration zones contain significant gold contents. Continuous channel sampling yielded up to 15m in width with gold contents in excess of 3 g/t. These higher grade zones are surrounded by mineralized, but lower grade material. Reverse circulation drilling has true widths of the mineralized zones are interpreted to be 30 to 100m. Intercepts from these zones include:
110 m grading 2.1 g/t Au (La Cruz)
138 m grading 1.1 g/t Au (Viruela)
108 m grading 1.1 g/t Au (Cerro de Orro)
These zones are within an area of intense high-sulphidation epithermal style alteration including silica, silica-alunite and advanced argillic assemblages that has been outlined over an area that is 1400 m long in a northwest direction and 900 m wide in a northeast direction. Initial drilling within this large area of altered rock was targeted in places with higher gold grades from surface samples, in what was considered to be three discrete zones of gold mineralization. Drilling is now focused on areas with no outcrop or lower grade, shallow cover rocks peripheral to the original holes to expand the zones and to test the potential for connecting the zones. This approach is working, and there is now only a 150 m gap between what is considered to be the La Cruz and Viruela zones. Drill holes are planned to test this gap, as well to test the open extents of mineralization. Holes have also been planned to test for extensions to the two main lobes of mineralization at the Cerro de Oro zone, and the area between Cerro de Oro and the other two zones. The gold mineralized horizon is presumed to continue on the down dropped side of a major fault west of the known extent of the three known zones.
Cieneguita Zone
The Cieneguita zone occurs 1800 m northwest of the La India zone and contains a large west dipping bedding controlled zone of silicification and gold mineralization. It has now been intersected by holes spaced over an 800 m strike length. The zone averages from 6 to 70m thick with grades ranging from 0.5 to 30g/t Au. Mineralization starts from surface. Holes RC06-59 and 60, drilled from same pad test to test the Cieneguita zone, intersected 32.0 m grading 1.10 g/t Au and 39.6 m grading 1.23 g/t Au respectively. (Estimated true thickness of 32 m). Hole RC06-61, drilled 600 m SSE of these holes intersected 64.0 m at 0.91 g/t Au. (Estimated true thickness of 50 m). Silicification outcrops over an extensive area at Cieneguita, and the results from the recent holes has shown this to be a high priority target for near-surface oxide gold mineralization.
La India Zone
The La India mine workings are developed in argillized porphyritic dacite intrusive that underlies silicified felsic fragmental strata. The silicification appears to be controlled by both stratigraphy and by high angle structures, extends over an area of 300 x 700m, and may be part of the silicified zone exposed to the north at the La Espanola and La Cieneguita areas.
In contrast to other mineralized zones in the region, where gold is generally restricted to silicified zones, at the La India mine significant gold mineralization occurs in argillized volcanic units. Continuous channel sampling yielded as much as 14m @ 2.05 g/t Au in the argillized dacitic porphyry. The La India target is also unusual in that thus far, it is the only gold occurrence in the project area that is also associated with disseminated copper mineralization. Copper contents in the drill core samples from the 5 drillholes adjacent to the La India workings average in excess of 537 ppm, whereas all other drill samples in the area average only 67 ppm copper. The target was tested by 7 diamond drillholes in 2004. Results indicated that low grade gold mineralization is continuous for at least an 80m vertical range in the area of drillholes DH04-01 through DDH04-05, however the orientation of the mineralized zones is unknown. Both NE and NW striking structures were observed, with the high angle NE structures appearing to be the primary control. Further drillhole testing of the zone is required in order to adequately determine controls to gold distribution and its economic significance. The most significant results were obtained from drillholes DDH04–02 and DDH04-04, which yielded 31.3m @ 1.30 g/t Au and 37.2m @ 1.04 g/t Au respectively (Diamond drill hole DDH04-02 also intersected 57m @ 0.15% Cu and this cupriferous intercept is partly coincident with the 31.3m auriferous intercept. The strike and depth extents of the mineralized zone have not been defined by drilling.
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43-101 Report (July 14, 2006)
La India Property Maps
La India, Sonora, Mexico 