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  • AM Gold in demand after updated resource estimate for Pinaya Gold-Copper Project 0 comments
    Jun 7, 2011 12:24 PM | about stocks: AMG

    Shares in AM Gold (CVE:AMG, FRA:AMX) rose after the company released an updated resource estimate for the Pinaya Gold-Copper Project in Peru. Pinaya covers 35 mineral concessions, for 19,200 hectares, and is located within the Western Cordillera of the Peruvian Andes, approximately 110 kilometers northeast of the city of Arequipa.

    The revised estimate included 151 of 160 diamond drill holes (44,306 of 46,531 meters) completed over a four year period from 2004, and used a cut-off grade 0.25 grams per tonne (g/t) gold and 0.3% copper. Other factors applied to the resource estimate were a overall recovery of 80% and metal prices of $1100/ounce gold and $3.00/pound copper.

    Mineral resources were estimated for the Gold Oxide Skarn Zone as well the two copper / gold zones: the Western Porphyry Zone and the Northwestern Porphyry Zone.

    ”We are extremely pleased with this increased resource estimate. Inferred Resources have increased by approximately 110% contained ounces gold and 177% contained pounds copper when compared to the Company's previous inferred mineral resource estimate prepared in 2006,” John Fiorino, CEO of AM Gold, commented.  

    “In addition, the Company upgraded 22% of the copper and 31% of the gold of the indicated resource estimate prepared in 2006 to a measured resource."

    At the Gold Oxide Skarn Zone, total measured and indicated resources now stand at 6.401 million tonnes averaging 0.798 grams per tonne gold and 0.092% copper (164,000 ounces of gold and 13.03 million pounds of copper. A further 2.383 million tonnes @0.597 g/t gold and 0.081% copper sits in the inferred category.

    At the two porphyry zones (Northwestern and Western) the total measured and indicated resource are 32,269 million tonnes @ 0.393% copper and 0.435 g/t gold (0.626% copper equivalent), containing 279.738 million pounds of copper and 452,000 ounces of gold.  There is a large inferred resource too, standing at 35.412 million tonnes @ 0.402% copper and 0.27 g/t gold (0.546% copper equivalent).

    AM Gold is also currently developing its flagship Red Mountain gold property in central Yukon Territory. The property is located within the Tintina Gold Belt of the Mayo Mining District, and is approximately 135 kilometres east of Dawson City, and 57 kilometres northwest of Mayo. 

    The gold mineralization at Red Mountain is contained within a porphyry intrusive body that is known as the Jethro Structure, and has a projected strike length of 700 metres, strikes 120°, and dips steeply to the southwest, and has a width of 130 to 190 metres, with an average of 165 metres. Gold is contained within disseminated sulphides, with higher grades found in steeply dipping, sulphide bearing sheets that carry quartz veins and some stockworks. Gold values are also reported in the surrounding meta-sedimentary sandstone and quartzite rocks.

    These types of deposits tend to persist to significant depths, with Red Mountain confirming mineralization from near surface to depths of approx. 500 metres. Additional potential was identified in Hole ICE10037, which was drilled 90 metres north of the Jethro Structure which intersected mineralization in porphyry intrusive rock, starting at 20 metres down-hole, and intersected 0.83 g/t Au over 5.48 metres at the bottom of the hole. This was not included in the Inferred Resource Estimate, and has potential as identifying an entire new gold zone. 

     

    Themes: Gold, TSX-V, Mining Stocks: AMG
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