And With One Hole, Mexican Gold (CVE:MEX, FRA:4QW1) Shows Multi-Million Ounce Potential
Mexican Gold (CVE:MEX, FRA:4QW1) is currently preparing its maiden resource and our internal estimate pegs it to be between 750,000 and 1.0 million ounces of gold equivalent.
Yesterday, Mexican Gold announced the result from its sole step-out drill hole, LM-17-CS-04, and we consider it to be the biggest news the company has put out since the discovery of the El Dorado Deposit.
Mexican Gold’s current drill program has primarily been dedicated to in-fill the El Dorado-Juan Bran Zone to complete a maiden resource, slated for late June and early July.
However, Mexican Gold dedicated one hole from the program as a step-out in a totally new area, to test the geological concept at the Cinco Senores historical mining area. Cinco Senores is littered with old workings, including large underground openings.
The hole hit in a big way, intersecting a high-grade two-metre interval with massive chalcopyrite grading 10.8 g/t gold, 41.7 g/t silver and 2.8% copper, or 15.98 g/t gold equivalent.
LM-17-CS-04 was actually a follow-up to three holes drilled back in 2011, headlined by 1.69 g/t AuEq over 22.0 meters. At the time, the results were fairly lackluster, but still warranted further investigation. MEX was finally able to follow-up, drilling a step-out 100 meters to the west of previous drilling:
This drill hole, combined with the 2011 drilling and sampling program, indicates that Cinco Senores has the potential to be another El Dorado/Juan Bran-type zone.