Extorre Gold Mines Limited

Extorre Gold Mines Limited

December 14, 2010 09:02 ET

Extorre Reports High Grade Gold-Silver Drill Intercepts From the Cerro Moro Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 14, 2010) - Extorre Gold Mines Limited (TSX:XG)(FRANKFURT:E1R)(OTCQX:EXGMF) ("Extorre" or the "Company") is pleased to report assay results from its ongoing drilling program at the Cerro Moro Project, in Santa Cruz Province, Argentina. Recent drilling has focussed on a combination of discovery drilling on new targets and extensions to known mineralization, and infill drilling on existing resource areas. In addition, drilling for infrastructure purposes has also been conducted. 

Results from the discovery diamond drilling program on the Gabriela, Escondida, Martina and Loma Escondida zones have been received. Twelve drill holes returned significant results of which 5 holes returned the following intercepts:

  • MD1002 (Gabriela) intersected 0.39 metres ("m") at 200.9 grams per metric ton ("g/t") gold + 8,785 g/t silver (347.3 g/t gold equivalent*)
  • MD0940 (Escondida) intersected 4.40m at 5.4 g/t gold + 668 g/t silver (16.5 g/t gold equivalent*)
  • MD0947 (Escondida) intersected 3.25m at 10.4 g/t gold + 788 g/t silver (23.6 g/t gold equivalent*)
  • MD0951 (Escondida) intersected 1.10m at 6.2 g/t gold + 702 g/t silver (17.9 g/t gold equivalent*)
  • MD0980 (Martina) intersected 0.73m at 14.3 g/t gold + 10 g/t silver (14.4 g/t gold equivalent*)

Results from 33 drill holes of the infill drilling program at the Gabriela and Loma Escondida zones have also been received, of which 25 have significant results. Highlights from the Loma Escondida zone include:

  • MD1030 intersected 0.34m at 74.5 g/t gold + 4,685 g/t silver (88.1 g/t gold equivalent*)
  • MD1036 intersected 0.88m at 55.0 g/t gold + 2,408 g/t silver (95.1 g/t gold equivalent*)
  • MD1038 intersected 0.50m at 90.4 g/t gold + 6,344 g/t silver (196.1 g/t gold equivalent*)
  • MD1046 intersected 0.40m at 74.2 g/t gold + 5,963 g/t silver (173.6 g/t gold equivalent*)

Eric Roth, Extorre´s President and CEO, stated, "Extorre's drilling programs have been designed to both expand Cerro Moro's high grade gold-silver resources and to infill the Inferred category resources that formed part of the Preliminary Economic Assessment ("PEA"). Infill drilling provides the assay data necessary for Inferred category resources to be upgraded, as results allow, to the Indicated category. Indicated resources can ultimately be reclassified as "mineable reserves" in the Pre-Feasibility Study ("PFS"). 

"Separately, infrastructure drilling for water resources and plant site engineering was completed over the past months as was necessary for the Environmental Impact Assessment ("EIA") and the PEA (currently under review by Santa Cruz authorities).

"With the infill drilling program largely complete, the discovery program is now our highest priority. Up to 4 drill rigs are working on a 24 hours basis to establish additional resources on the property. Drilling is focussing both on new targets such as the Martina and Lucia veins and extensions to existing resource areas at Escondida, Gabriela, and Loma Escondida. Separately, drilling to increase the resource on another vein named the Esperanza zone has now commenced.

"We still have an assay back log amounting to some 100 drill holes. To alleviate this problem we are building an onsite sample preparation facility that will be operated by Acme Laboratories. Construction is underway with startup scheduled for February 2011."

Significant discovery drilling results using a 1.0 g/t gold equivalent* cut-off grade are as follows:

Drill Hole From
* (g/t)
* (oz/ton)
Gabriela Zone
MD0992 200.15 201.75 1.60 1.5 349 7.4 0.22
including 200.15 200.75 0.60 3.2 775 16.1 0.47
MD996 204.65 207.30 2.65 2.3 376 8.6 0.25
MD1002 217.85 218.24 0.39 200.9 8,785 347.3 10.07
Escondida Zone
MD0936 91.60 92.20 0.60 18.6 1,477 43.2 1.25
and 101.00 105.00 4.00 3.2 29 3.7 0.11
MD0937 112.00 112.60 0.60 38.2 1,147 57.3 1.66
including 112.30 112.60 0.30 74.0 2,125 109.4 3.17
MD0940 163.30 165.00 1.70 2.6 222 6.2 0.18
and 178.00 182.40 4.40 5.4 668 16.5 0.48
including 178.60 180.00 1.40 15.7 2,045 49.8 1.44
MD0947 206.35 209.60 3.25 10.4 788 23.6 0.68
including 206.35 207.71 1.36 21.8 1,654 49.3 1.43
MD0951 195.00 203.80 8.80 2.9 280 7.6 0.22
including 196.00 197.10 1.10 6.2 702 17.9 0.52
including 197.76 198.10 0.34 9.2 796 22.4 0.65
including 203.30 203.80 0.50 8.6 940 24.2 0.70
MD1017 314.00 314.70 0.70 5.3 12 5.5 0.16
and 316.50 317.02 0.52 4.2 18 4.5 0.13
MD1023 301.00 302.55 1.55 9.3 8 9.5 0.28
including 302.17 302.55 0.38 32.3 21 32.6 0.95
Martina Zone
MD0980 244.50 245.23 0.73 14.3 10 14.4 0.42
Loma Escondida Zone
MD0853 57.75 58.15 0.40 3.3 531 12.1 0.35

Significant "infill" drilling results using a 1.0 g/t gold equivalent* cut-off grade are as follows:

Drill Hole From
* (g/t)
* (oz/ton)
Loma Escondida Zone
MD1029 18.30 19.18 0.88 1.5 175 2.8 0.08
MD1030 38.56 38.90 0.34 74.5 4,685 88.1 2.55
MD1032 17.16 19.50 2.34 4.4 355 5.7 0.17
including 18.43 19.50 1.07 9.5 711 11.1 0.32
MD1034 37.45 38.60 1.15 3.9 430 11.0 0.32
including 37.45 37.76 0.31 13.7 1,291 35.2 1.02
MD1038 20.83 23.30 2.47 20.4 1,522 45.8 1.33
including 21.15 21.65 0.50 90.4 6,344 196.1 5.69
MD1040 42.42 42.72 0.30 20.3 1,325 42.4 1.23
MD1042 65.10 65.47 0.37 41.7 1,340 64.0 1.86
MD1044 5.90 7.00 1.10 1.2 81 2.5 0.07
including 5.90 6.25 0.35 3.2 157 5.8 0.17
MD1046 37.23 38.10 0.87 34.3 2,772 80.5 2.33
including 37.23 37.63 0.40 74.2 5,963 173.6 5.03
MD1048 61.00 62.00 1.00 15.1 663 26.2 0.76
including 61.00 61.35 0.35 40.9 1,750 70.1 2.03
MD1061 37.60 38.44 0.84 3.2 321 8.6 0.25
including 38.10 38.44 0.34 7.1 700 18.7 0.54
MD1063 58.80 59.73 0.93 1.3 166 4.1 0.12
including 59.30 59.73 0.43 2.2 286 7.0 0.20
MD1065 37.00 37.90 0.90 19.7 1,165 39.1 1.13
including 37.55 37.90 0.35 50.3 2,864 98.0 2.84
Gabriela Zone
MD1022 28.15 31.90 3.75 5.0 582 11.1 0.32
including 29.90 30.90 1.00 11.1 1,208 30.0 0.87
MD1026 26.79 27.45 0.66 2.6 366 4.2 0.12
MD1028 47.15 49.00 1.85 2.2 264 6.3 0.18
including 47.15 47.45 0.30 9.9 1,119 29.6 0.86
MD1031 52.00 53.50 1.50 2.9 433 10.1 0.29
including 52.70 53.50 0.80 5.1 771 18.0 0.52
MD1035 51.15 52.85 1.70 1.4 167 4.2 0.12
including 51.74 52.05 0.31 4.4 565 13.8 0.40
MD1037 33.78 35.40 1.62 4.6 606 14.7 0.43
MD1043 30.70 32.73 2.03 2.6 398 9.2 0.27
MD1047 84.30 86.65 2.35 5.1 765 17.8 0.52
including 85.00 85.80 0.80 7.9 1,241 28.6 0.83
MD1050 38.00 42.00 4.00 2.9 504 11.3 0.33
including 39.70 41.50 1.80 5.3 919 20.6 0.60
MD1051 66.45 71.19 4.74 1.9 319 7.2 0.21
including 70.00 70.45 0.45 4.4 588 14.2 0.41
MD1067 153.15 155.20 2.05 1.7 291 6.5 0.19
including 153.15 153.60 0.45 5.9 1,008 22.7 0.66
* Gold equivalent grade is calculated by dividing the silver assay result by 60, adding it to the gold value and assuming 100% metallurgical recovery.

A discussion of the drilling results follows:

Gabriela Zone Drilling

Extorre's drill strategy at Gabriela has been to expand the existing resource through drilling both at depth and along strike to the southeast, and secondly, to complete infill drilling of the existing resource area for the PFS. New resource drilling continues to confirm continuity of the Gabriela vein to depth, especially beneath the eastern end of the current resource area.

New geological mapping and drilling data suggest that the step-out drill holes designed to extend near surface mineralization to the southeast have been too shallow. Current results suggest that mineralization in this sector has either been faulted downwards or may plunge towards the southeast. Follow-up drilling is a high priority. The infill drill program at Gabriela consisted of 5,383m in 48 holes and focussed on the conversion of the existing Inferred category mineral resource to the higher confidence categories.

Escondida Zone Drilling

Recent drilling at Escondida in the Far West and West sectors has focused on two main areas: a "Gap area", where an unmineralized dyke has been interpreted to cross-cut the highly mineralized Escondida structure, and secondly, step-out drilling to the west along the Fomicruz JV Extension. In the "Gap area", extensions to known high grade gold-silver mineralization were intersected and remain open at depth. Follow-up drilling is planned. On the Fomicruz JV extension, drilling has intersected quartz veining within the Escondida structure, but without the sulphide phase typically associated with high grade gold-silver mineralization. Further drilling in this sector will be undertaken when all the available geological and geochemical data have evaluated. 

Martina Zone Drilling

Further high grade mineralization has been intersected at a depth of 220m. Significant results were received from drill hole MD0980, located 160m to the east of previously reported high grade mineralization. Drilling completed 70m below the MD0989 intercept did not intersect significant mineralization, suggesting that high grade mineralization in this zone occurs at 180m to 250m below surface. Follow-up drilling in this depth range is planned. 

Loma Escondida Zone Drilling

Drilling has been limited to step-out holes to the west of the existing resource and a short infill program within the known resource. Hole MD0853 was drilled 160m west of the existing resource and approximately 150m to the east of the intersection of the Loma Escondida vein with the Escondida vein. The drill hole successfully intersected high grade gold-silver mineralization, demonstrating the upside potential of the Loma Escondida zone. Follow-up drilling in the MD0853 sector is planned.

The infill drill program at Loma Escondida consisted of 1,567m in 32 holes and focussed on upgrading the existing Inferred category mineral resource to the higher confidence categories. As ore from the Loma Escondida zone is scheduled to be mined early in the Cerro Moro mining schedule, the completion of this infill drill program was considered to be a priority. 

Infrastructure Drilling

To complete the EIA and the PEA, 48 drill holes (mostly reverse circulation percussion holes) were completed. Twenty holes were dedicated to sterilization (or condemnation) drilling of the proposed processing plant site and 22 to further evaluate water sources. 

Click Here for the long sections and plans: http://www.extorre.com/pdf/release/diagram_07.pdf.

Quality Control and Assurance

Drill widths presented above are drill intersection widths and may not represent the true widths of mineralization.

Gold assay results presented above are preliminary with no cutting of high grades. All diamond drill core samples are split on regular metre intervals or on geological contacts and represent sawn half HQ-size core. Reverse circulation drill samples are collected using a cyclone in one metre intervals. Samples were prepared at the Acme Analytical Laboratories ("AcmeLabs") preparation facility in Mendoza, Argentina and assayed by fire assay (50 gram charge) at the AcmeLabs laboratory in Chile, both ISO-9001:2000 certified laboratories.

Check assaying of all samples assaying greater than 1.0 g/t gold is completed by Acme Labs. Samples returning greater than 10 g/t gold and/or greater than 100 g/t silver are assayed using gravimetric analyses. Standard and blank samples are used throughout the sample sequence as checks for the diamond drilling reported in this release. Standard, blank and duplicate samples are used throughout the sample sequence as checks for the RC percussion drilling.

Assaying by the screen fire assay method has been implemented in conjunction with standard 50 gram fire assaying, for diamond drill cores that contain visible gold. The procedure for screen fire assaying involves crushing and sieving of a nominal 1,000 gram sample to a particle size of 100 microns. All material which does not pass through the 100 micron sieve is then assayed. Two fire assays are undertaken on the undersize material as a check on homogeneity. The total gold content is then calculated.

Matthew Williams, Extorre's Exploration Manager and a "qualified person" within the definition of that term in National Instrument 43-101, Standards of Disclosure for Mineral Projects, has supervised the preparation of the technical information contained in this news release.

About Extorre

Extorre is a Canadian public company listed on the Toronto Stock Exchange (symbol XG) and on the OTCQX (symbol EXGMF). Extorre's assets comprise approximately $46 million in cash, the Cerro Morro and Don Sixto projects, and other mineral exploration properties in Argentina.

On April 19, 2010, Extorre announced an updated National Instrument 43-101 compliant mineral resource estimate for Cerro Moro:

  • Indicated Category: 357,000 oz. gold + 15.3 million oz. silver (612,000 oz. gold equivalent*), plus
  • Inferred Category: 190,000 oz. gold + 12.0 million oz. silver (390,000 oz. gold equivalent*)

The 612,000 ounce gold equivalent* indicated resource, has an average grade of 32.3 g/t gold equivalent*, a grade considered exceptional by industry standards. The silver contribution is high, accounting for over 40% of the metal value. Additional inferred resources of 390,000 ounces gold equivalent* are also reported from Cerro Moro.

Extorre released the results of a PEA of the Cerro Moro Project on October 19, 2010. The PEA highlighted the robust economics of the future Cerro Moro mine, in which an average of 133,500 gold equivalent* ounces would be produced during the first 5 years of operation at a cash cost of US$ 201 per ounce (net of silver credits). Project CAPEX has been estimated at US$ 131 million (of which 21% is tax that is refundable after production commences), with a payback period of 1.8 years. The project economics were calculated using gold and silver prices of US$ 950/ounce and US$ 16/ounce, respectively. 

Extorre also submitted its Environmental Impact Assessment for the Cerro Moro mine development to Santa Cruz Authorities on September 16, 2010. Mining permits and approvals for the Cerro Moro mine are expected to be received by the end of Q1-2011.

You are invited to visit the Extorre web site at www.extorre.com.


Eric Roth, President and CEO


Safe Harbour Statement – This news release contains "forward-looking information" and "forward-looking statements" (together, the "forward-looking statements") within the meaning of applicable securities laws and the United States Private Securities Litigation Reform Act of 1995, including our belief as to the extent and timing of its drilling programs, various studies including the PFS and the Environmental Impact Assessment, and exploration results the potential tonnage, grades and content of deposits, timing, establishment and extent of resources estimates, potential production from and viability of its properties, production costs and permitting submission and timing. These forward-looking statements are made as of the date of this news release. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated in or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. While we have based these forward-looking statements on our expectations about future events as at the date that such statements were prepared, the statements are not a guarantee that such future events will occur and are subject to risks, uncertainties, assumptions and other factors which could cause events or outcomes to differ materially from those expressed or implied by such forward-looking statements. Such factors and assumptions include, among others, the effects of general economic conditions, the price of gold and silver, changing foreign exchange rates and actions by government authorities, uncertainties associated with legal proceedings and negotiations and misjudgments in the course of preparing forward-looking information. In addition, there are known and unknown risk factors which could cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. Known risk factors include risks associated with project development; the need for additional financing; operational risks associated with mining and mineral processing; fluctuations in metal prices; title matters; uncertainties and risks related to carrying on business in foreign countries; environmental liability claims and insurance; reliance on key personnel; the potential for conflicts of interest among certain of our officers, directors or promoters of with certain other projects; the absence of dividends; currency fluctuations; competition; dilution; the volatility of the our common share price and volume; tax consequences to U.S. investors; and other risks and uncertainties, including those relating to the Cerro Moro project and general risks associated with the mineral exploration and development industry described in our interim financial statements and MD&A for the fiscal period ended March 31, 2010 filed with the Canadian Securities Administrators and available at www.sedar.com. Although we have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. We are under no obligation to update or alter any forward-looking statements except as required under applicable securities laws.

Cautionary Note to United States Investors - The information contained herein and incorporated by reference herein has been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of United States securities laws. In particular, the term "resource" does not equate to the term "reserve". The Securities Exchange Commission's (the "SEC") disclosure standards normally do not permit the inclusion of information concerning "measured mineral resources", "indicated mineral resources" or "inferred mineral resources" or other descriptions of the amount of mineralization in mineral deposits that do not constitute "reserves" by SEC standards, unless such information is required to be disclosed by the law of the Company's jurisdiction of incorporation or of a jurisdiction in which its securities are traded. U.S. investors should also understand that "inferred mineral resources" have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. Disclosure of "contained ounces" is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in place tonnage and grade without reference to unit measures.


Contact Information

  • Extorre Gold Mines Limited
    Eric Roth
    President and CEO
    Extorre Gold Mines Limited
    Rob Grey
    VP Corporate Communications
    604-681-9512 or Toll-free: 1-888-688-9512
    604-688-9532 (FAX)