Ecometals Limited
FRANKFURT : GDQ
BERLIN : GDQ
TSX VENTURE : EC

Ecometals Limited

October 05, 2010 08:00 ET

Ecometals Announces Discovery of Au-Mineralized Quartz-Chlorite Hydrothermal Veins and Continuing Exploration Plans at the Rio Zarza Gold Project, Ecuador

TORONTO, ONTARIO--(Marketwire - Oct. 5, 2010) - Ecometals Limited (TSX VENTURE:EC)(BERLIN:GDQ)(FRANKFURT:GDQ) -

Ecometals Limited announces preliminary results of a new discovery of Au-mineralized veins on the west side of the property, and plans for continued exploration on the Rio Zarza Gold Project including trenching, geophysics, and shallow diamond drilling.

Highlights of 2010 Exploration Campaign thus far:

  • Completed 4700m deep diamond drilling programme in volcano-sedimentary basin on east side of the project
  • Clear geological evidence of hydrothermal mineralization analogous to the Kinross Fruta del Norte deposit
  • Discovery of Au-mineralised polymetallic veins in the western part of the tenements confirms gold is present on the property
  • A number of priority geophysics and geochemical targets remain untested, including deep targets in the basin and shallow targets hosted by the Zamora Batholith granodiorite

Focus for the rest of the year:

  • Compilation of exploration results and research studies from the 2010 campaign
  • Deep-looking geophysical survey in the volcano-sedimentary basin to identify deep targets
  • Shallow diamond drilling on Au polymetallic quartz veins
  • Detailed magnetics, surface trenching and shallow diamond drilling of IP Chargeability and soil geochemistry targets hosted by the Zamora Batholith

Based on geologically encouraging results achieved to date, the Company believes the Rio Zarza project remains highly prospective and will continue detailed exploration on targets both in the volcano-sedimentary basin and in the Zamora Batholith.

Deep Diamond Drilling Programme

The deep diamond drilling programme completed 8 holes to target depth, drilling 4700m within the contractual limited maximum.

The exploration programme has generated a large volume of data which is now being studied to guide the future drilling to the locus of mineralization. The key results of the programme are:

  • Demonstrated same stratigraphy which hosts FdN is present on the Rio Zarza property
  • Mineralization is related to the unconformity between the Misahuallí Fm volcanics and Suarez Fm sediments, but these formations are interfingered due to coeval deposition, which creates multiple deposition sites
  • Mineralized restricted within an elevation range from 1050 to 1250masl related to a particular stage of the basin evolution
  • Alteration facies including silicification, chlorite-carbonate-sulphides and zoned veining characteristic of epithermal mineralization analogous to Fruta del Norte
  • Geochemically anomalous Au and associated suite of base metals characteristic of epithermal mineralization
  • Major structural features bounding and internal to the basin which have acted as fluid conduits and mechanical preparation
  • Developed a refined conceptual geological exploration model in the volcano-sedimentary basin

The diamond drilling programme intersected all the geological characteristics typical of Fruta del Norte mineralization, but as yet has not located the core of the hydrothermal system where higher Au grades are expected. Alteration facies are the key vectors to the core of mineralization and are currently being studied.

The programme exceeded both Corporate and Regulatory environmental guidelines, was conducted efficiently and according to industry best practice QA/QC, and without a single LTI injury for more than 80,000 man-hours of work.

There are three conceptual targets in the Suarez-Misahuallí basin which remain untested:

  • South of Rio Blanco: IP Chargeability anomaly indicative of sulphides associated with the alteration halo surrounding mineralization, interpreted thicker section of Suarez Fm and overlying Hollín Fm cover
  • North of Rio Machinatza: shallow IP Chargeability and soil geochemistry anomalies, structurally complex area where possible offset portion of FdN mineralization is displaced
  • Deeper in the basin, below the depth capacity of the Hydracore drill rig, evidenced by intersection of 1.245g/t Au over 2m composite in hole RZDDH10-08 and anomalous geochemistry at the bottom of other holes

Geophysical targets at the Suarez-Misahuallí unconformity has been the main conceptual target for drilling in the basin, and has been successful in locating characteristic alteration associated with mineralization. However, structures controlling the main hydrothermal fluid conduits may only be evident deeper and shown by structural offsets at the floor of the basin.

Silva Occurrence Rio Zarza 773455E/9582534N

The Silva occurrence is along the Rio Zarza where outcrop of the Zamora Batholith hosting a a swarm of mineralized hydrothermal veins has been exposed. Detailed investigation has mapped quartz-chlorite veins with pyrite, chalcopyrite ±bornite, galena. Pan concentrates from the vein material yielded fine visible gold.

Although the area is deeply weathered, relic textures of vein and host rock remain. Quartz vein material is intact, with fresh sulphides preserved internally, and the chlorite alteration selvage is preserved. Where the veins are sulphide-rich, only haematite-limonite remains. The thickness of quartz veins pinch and swell, and are broken by late brittle fracturing.

Analytical results range from geochemical anomalous levels up to 0.8g/t Au in the main outcrop area, and 1.165g/t Au near the riverbank from 0.5m channel samples across veins.

This occurrence is within a large area of anomalous Au soil geochemistry, but which is partially contaminated by active and historical alluvial mining reportedly since Spanish colonial times. Anomalous IP Chargeability is also coincident, indicative of the sulphides in the veins and alteration halo. This discovery demonstrates that alluvial Au is in part locally derived from a bedrock source, and there are sources of hydrothermal mineralization in the Zamora Batholith outside of the Misahuallí-Suarez volcano-sedimentary basin.

Pintado Occurrence Rio Zarza 774601E/9582266N

The Pintado Occurrence is a similar artisanal alluvial mining operation along the Rio Zarza where Zamora Batholith is exposed. Similar quartz-chlorite veins are mapped, but the exposure is limited and is being actively mined, which precludes detailed mapping.

Exploration Works planned for fourth Quarter 2010

Geophysics

In preparation for the continued deep drilling in the first quarter of 2011 exploration programme, deep-looking geophysics is planned to identify targets in the Misahuallí-Suarez basin. Electrical geophysical methods, either electomagnetics or galvanic-type resistivity methods are being considered for the most effective means of outlining deep drilling targets.

Detailed magnetics over the Silva, Pintado and other IP Chargeability anomalies will also be conducted.

Commissioning Shallow-Depth Capable Diamond Drill

A surface trenching programme following up anomalies from the 2007 soil geochemistry survey is proving of limited of effectiveness, due to the thickness of organic and transported surface material covering the residual soil profile.

To continue testing of geochemical and geophysical anomalies, the Company is commissioning a shallow diamond drill which was previously used on the Condor Gold project. The MD-2 drill is capable of up to 200m depth HQ size core drilling, which is sufficient to test targets through the deep tropical weathering profile into fresh bedrock.

The first targets planned for drilling are on the Silva occurrence, followed by testing IP Chargeability anomalies.

Other Exploration Works

  • Research into gold grain morphology and trace geochemistry to confirm alluvial gold is directly sourced from mineralized veins
  • Research of trace element geochemistry, alteration facies and paragenesis to identify vectors to mineralization for continued drilling

Sample Preparation, Analytical Protocol and Quality Control

Readers are cautioned that gold in pan concentrate samples is a qualitative indicator only, and cannot be correlated to analytical results of samples taken with standard sampling protocols.

Outcrop samples were taken over 0.5m channels across structural and vein trends, with location, description and GPS position of each sample recorded in field notebooks and later transcribed to the digital database.

Samples were prepared at the ALS Chemex sample preparation laboratory in Quito, and analysed at the ALS Chemex South American regional laboratory in Lima, Peru. Samples were crushed to 70% passing 2mm and riffle split 250g subsample for pulverizing to 85% passing 75µm for analysis. Gold was analysed using the fire assay technique, and multi element analysis using ICP-MS.

Blanks and lab controls were used for quality monitoring of outcrop sample analyses. CRM and blank material is internationally certified and supplied by Ore Research and Exploration (Pty) Limited (OREAS) in Australia.

Quality control results indicate there is no apparent analytical bias or systematic contamination of samples, and analyses are accurate compared to CRM stated performance criteria.

Qualified Person

SR McMullan, P.Geo, Vice President of Exploration for Ecometals Limited, is a qualified person according to National Instrument 43-101 definition and has prepared the technical information included in this press release. Drilling, logging, sampling and dispatch were under the direct supervision of the Qualified Person.

About Ecometals

Ecometals Limited is a TSX Venture Exchange listed mineral exploration and development company focused on the mineral resources in Latin America. Apart from its gold projects in Ecuador, Ecometals also has significant manganese, iron and gold projects in Brazil at grass roots exploration and development planning stages.

Chief Executive Officer Fran Scola said, "The focus of exploration on the Rio Zarza project remains on the volcano-sedimentary structural basin where there is the greatest potential for discovery of high grade epithermal style mineralization. Testing of other targets on the west side of the property gives the technical team a chance to evaluate the results acquired thus far, and refine targets for continued deep drilling in the basin.

The property is by no means completely explored, there are many untested priority targets, and the discovery of Au mineralized veins is evidence of significant discovery potential. The Company maintains its enthusiasm for Rio Zarza as a priority project."

Safe Harbor Statement: Statements contained in this release that are not historical facts are forward-looking statements which involve risk and uncertainties, which could cause actual results to differ materially from those expressed in forward-looking statements.

These include risks relating to changes in economic or environmental conditions and the company's ability to execute its business model and strategic plans. The company relies on litigation protection for forward-looking statements.

"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."

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