With Recent $5 Million Financing, Urastar Now Planning Drill Programs Aimed at Three Mineral Properties in Prolific Gold Camps – Mexico’s Sierra Madre Gold Belt and Nevada’s Battle Mountain-Eureka District.
Urastar Gold Corp. is focused on exploring and developing gold properties with records of past production in world class mining camps. Currently, the company is preparing drilling programs for three properties.
- El Antimonio Gold-Antimony Property, Mexico (Sierra Madre Gold Belt).
- Blackpoint Gold-Silver Property, Nevada (Battle Mountain-Eureka District).
- Jabali Gold Mine project, Mexico (Sierra Madre Gold Belt).
- Well funded with recent $5 million financing.
- Properties are proven past producers with similarities to world class mines in the same mineral belt (prospective locations in the “right” area code).
- Properties are at the drill ready stage.
- Near term, cost effective drill programs are expected to be announced with increased news being generated over the coming weeks and months.
- Urastar management is expected to continue with a property acquisition strategy and an interesting pipeline of projects should be assembled for ongoing exploration and development.
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El Antimonio Gold-Antimony Property, Sierra Madre Gold Belt, Mexico
El Antimonio has a top priority for Urastar owing to its apparent similarity to nearby open pit, heap-leach mines. These include La Herradura (largest gold producer in Mexico with reserves of 10.9 million tons @ 0.75 g/t Au) and El Chanate (reserve: 39.5 million tonnes at 0.66 g/t in December of 2008). Grades at El Antimonio are similar to these average grades (see below) and both mines are situated within a gold metallogenic belt known as the Mojave-Sonora Megashear, as is the El Antimonio property.
|Property Highlights – El Antimonio|
|Location||4,000 hectares located in northwest Sonora in the heart of the Mojave-Sonora Megashear.|
|Past Producer||Placer gold and antimony from gravel derived from numerous reported vein occurrences.
Local prospectors continue to recover small amounts of gold nuggets from those gravels using metal detectors. The nuggets do not appear to have been transported very far as they are fairly coarse and not rounded or flattened.
|Target||Bulk mineable gold deposit centered on one or more of the previously mined vein areas coupled with a new discovery.|
|A total of 42 samples were collected from 7 different clusters of old mine workings (vein swarms) over an area 4 km by 2 km. Further sampling was done in October of 2010 following acquisition of additional ground.
Note – results are considered highly significant because most of the samples are of altered and weakly mineralized material that was left behind so the ore grade material that was mined is not included in the average.
|Potential||The potential at El Antimonio is considered excellent in view of several factors:
To date, Urastar has completed surface mapping, along with geological modeling. The property is considered to be at the drill ready stage and management is expected to announce a program shortly.
Blackpoint Gold-Silver Project, Battle Mountain-Eureka District, Nevada
Blackpoint is also a past producer, with records indicating silver production between 1933 and 1941 from near surface zones and grading 400 g/t to 3,700 g/t Ag (12 – 108 oz/t). The property is in close proximity to the past producing Ruby Hill Gold Mine, which yielded 135,000 ounces of gold annually between 1997 and 2002.
More recent work in the 1980s concentrated on investigating the potential for continuity of this high grade silver, with several short holes being drilled in 3 zones along the outer edge of the property’s mineralizing system.
These results are historic in nature and have not been fully verified by a qualified person.
All the previous work was centered around the silver mineralization with no work done on looking for the gold bearing part of the system that may be located more towards the centre or at depth of the peripheral silver zones.
The company intersected only erratic significant gold values as the drill holes were located near the top or above the mineralizing system.
What is interesting about this property is that the style of mineralization present is typical of that found at the active and historic mines in the area, specifically for a low-sulfidation, epithermal silver-gold system. This is supported by several factors which have been observed in work programs conducted since 2007, including:
- extensive silica-sericite alteration,
- high grade silver bearing veins, stockwork and breccias,
- scattered gold values
Near Term Work Program
The current program is being designed to determine whether depths of up to 500 meters in the property’s mineralizing system contain significant gold values. This is expected to be tested by diamond drilling of 3 or 4 holes (6,000’) to identify the main feeders and gold zones beneath the existing mineralized system.
One good analogue is Barrick Gold’s Meikle Mine deposit (8 million tons of 23 g/t Au) located 420 meters beneath a low-grade arsenic anomaly, with similar geology to the Black Point Project.
The company has stated that drilling is expected to begin in the next two months.
Jabali Gold Mine project, Mexico (Sierra Madre Gold Belt)
As with the two aforementioned properties, Jabali is also a past producer, consisting of one mineral claim covering 70 hectares. The Mulatos mine is 6 km to the east of the Jabali property and is one of the lowest cost heap-leach gold mines in the sector. The entire Salamandra Property consists of the producing mine (145,000 – 160,000 oz expected in 2011) along with 8 satellite gold systems known as El Halcon, La Yaqui, Los Bajios, El Jaspe, La Dura, Cerro Pelon, El Victor/San Carlos and El Carricito. Alamos Gold continues to very successfully explore and develop these additional gold resources throughout these claims.
The La Dura satellite gold system is covered by the Jabali claim. In other words, the Jabali project is actually a part of Alamos’ La Dura prospect, which was described in their 2003 Annual report.
“The La Dura prospect contains a large area of intense silicic alteration of over 3.5 kilometres in length with several historic gold workings. A core concession is not controlled by Alamos.” (The core concession is the Jabali project).
It becomes interesting when one appreciates that the La Dura (=Jabali) hydrothermal system is contiguous with another prospect to the south that is described in the Alamos 2003 Annual report as Los Bajios:
“The Los Bajios area may be the central part of one large, regional hydrothermal system, with Halcon located in the western portion, La Dura to the north, and La Yaqui on the south as lateral, distal equivalents. The size of the airborne resistivity anomalies and extent of alteration indicates potential for at least one
Mulatos-size deposit within the zone.”
The main mineralized zone is marked by a glory hole that exposes highly fractured and jarosite-stained silicified and brecciated rhyolite. An adit located just south and down hill from the glory hole leads to a honeycomb of old underground mine workings that extend downward from the glory hole. Jabali has produced gold from small scale operation since first being discovered by Jesuit priests in 1635.
Investment Considerations / Conclusions
With Urastar now with a market cap of less than $10 million, well financed with its recent $5 million share issue, and readying work / drill programs at multiple properties, investors should look for a more regular flow of news. Should the company’s expectations be borne out with near term drill results, investors are obviously highly levered to the upside.