Oct 24 2011
Argonaut Gold Inc. (TSX:AR) is reporting that the Measured and Indicated ("M&I") gold resource at its 100% owned La Colorada Project located near Hermosillo, Mexico has increased from 605,000 M&I ounces to 1,067,000 M&I ounces.
New National Instrument 43-101 ("NI 43-101") Technical Report on Resources
Argonaut has received an updated Canadian National Instrument 43-101 compliant Mineral Resource estimation from SRK Consulting in Denver, CO ("SRK") for its La Colorada project. The updated resource of 1,067,000 ounces is based on previous historical drilling plus an additional 206 drill holes totaling 31,744 metres completed in 2011. The resource is contained within 50 million tonnes of mineralized material at an average grade of 0.664 g/t gold and 8.7 g/t silver. This is a 76% increase in the gold resource over a previous (pre-Argonaut) technical report that identified an M&I resource of 605,000 ounces.
Updated Mineral Resource Summary of the La Colorada Property as of June 25, 2011
The stated Indicated mineral resources have been prepared in accordance with Canada's National Instrument 43-101 Standards of Disclosure for Mineral Projects. The Qualified Person, as defined by National Instrument 43-101, for the mineral resource estimation, is Principle Resource Geologist, Dr. Bart Stryhas, of SRK, Denver, Colorado. The resources are contained within Whittle pit shells based on $1,500/oz Au price, $20/oz Ag price, and recoveries of Au and Ag at 60% and 30% respectively.
Impact of change in cut-off grade:
A further review of the impact of raising the cutoff grade of La Colorada and El Creston shows minimal impact to the resource. By raising the cutoff grade from 0.10 g/t to 0.30 g/t the overall average grade increases to 1.0 g/t (48%), while total ounces drop -107 k oz (-11%). This indicates the whittle pit resource as reported can be optimized to find the optimum balance of cash flow to ounces produced.
2011 Drill Program:
Phase 1 of the La Colorada Drill Program was focused on converting previously inferred mineralization at the La Colorada and Gran Central resource areas. Initial favorable drill results prompted the Company to double the drill program scope, increasing the drill budget to $7.7 million with an estimated total of approximately 52,000 metres. The Company currently has three drill rigs operating on the property with a fourth rig scheduled to arrive shortly.
Source: www.argonautgoldinc.com