Malaga Inc.
TSX : MLG

Malaga Inc.

February 07, 2011 06:58 ET

Malaga Announces the Discovery of a New Tungsten Mineralized High Grade Deep Zone at Pasto Bueno

MONTREAL, QUEBEC--(Marketwire - Feb. 7, 2011) - Malaga Inc. ("MLG")(TSX:MLG) is pleased to announce the discovery of a new high grade tungsten zone located at depth under the old Pasto Bueno mine in the Consuzo sector (see map below). 

In 2010, Malaga carried out a small scale drilling scoping study at Pasto Bueno. One of the drill holes in this campaign, HDD 02 10, has led to the discovery of a new high grade deep zone in the Consuzo sector grading 1.83% WO3 over a width of 1.03 meters (for details see drilling results below).  

In 2010, Malaga also successfully partially reopened the old mine at Consuzo and has extracted more than 1,000 tonnes at an average grade of 1.5% WO3, from this zone. This part of the Pasto Bueno mine was the main mining focal point in the 1970s when a 1,000 ton/day plant was operated. The most important mineralized structure in this zone is the Loreto vein. Located in granitic rock, its composition varies from quartz monzonite to granodiorite. Its average thickness varies from 2 to 10 meters and the historic production from this vein has been 1.95 million tonnes of mineral grading 0.95% WO3. The company will continue to refurbish and explore the old Consuzo zone particularly in view of the new high grade zone that has been discovered which demonstrates that there is still a very high potential for new resources deeper down at Consuzo.

2010 Drilling Results

In 2010, the scoping drilling study consisted of four (4) diamond drill holes and 4 short range exploration drills (less than 50 meters long) adding up to respectively 1,737.85 meters and 131,6 meters of drilling. The main results are discussed and given in Table 1 below:

Table 1 Pasto Bueno 2010 Scoping Study Drilling Data    
             
             
Drill No. Zone Total length Intercept True Width Vein WO3
    (meters) (meters) (meters) intercepted %
             
HDD 02 10 Consuzo 390.8 334.12-335.85 1.03 Loreto 1.83
             
HDD 01 10 Huaura 680.35 388.85-394.05 0.36 Consuelo Split 3.63
      634.20-637.60 0.15 Sorpresa 0.81
             
HDD 01-10-IM Huayllapon 259.2 205.7-206.12 0.42 Sta Isabel 0.34
             
HDD 02-10-IM Huayllapon 407.5 292.6-295.7 0.28 Chabuca 0.15
             

Consuzo Zone

Drill hole HDD 02 10 was drilled to test whether tungsten mineralization could be found under the old Consuzo mine. The drill hole was 390.8 meters long and intersected the northern extension of the Loreto vein 250 meters below the level corresponding to the Pelagatos river which runs alongside the old Consuzo mine and plant. The tungsten content was analysed in Lima by a certified laboratory ALS CHEMEX and an intersect containing 1.83% WO3 over a width of 1.03 meter was found. This is a very exciting result since it demonstrates that high grade tungsten veins can be found at depth close to the old Consuzo mine. 

Huaura & Huayllapon Zones

Three drill holes were analysed, two drill holes in the Huayllapon sector and one in the Huaura zone.

In Huayllapon, drill hole HDD 01 10 IM intersected the Santa Isabel vein and found 0.34% WO3 over a width of 0.42 meters and drill hole HDD 02 10 IM intersected the Chabuca vein at level 12 and found within a 2.39 meter intersect a thinner mineralised part 0.28 meters wide with 0.15% WO3. These rather low values illustrate one of the difficulties of drilling at the Pasto Bueno mine since values can be erratic and the veins subject to pinch and swell. 

In the Huaura zone, one drill hole HDD 01 10 confirmed the economic mineralization of the Consuelo Split vein (3.63% WO3 over a width of 0.36 meters) and also led to the discovery of a new vein at depth named the Sorpresa vein where a 2.35 meter intersect was found to contain 0.81% WO3 over a 0.15 meter wide segment.

Finally, four (4) short range drill holes (less than 50 meters long) were drilled in the Maria Ofelia zone. The most significant result was 0.65% WO3 over a width of 0.36 meters. These short range drill holes will be used by the company to further define the pattern of mineralization in this zone.

Malaga's 2011 Exploration/Drilling Campaign

Malaga is gearing up for an active exploration year in 2011. Malaga is planning to explore new areas of the Pasto Bueno mine and property: these new previously unexplored areas are difficult to access and in 2010 Malaga built 1.9 km of roads for heavy equipment that will allow the company to explore and drill this promising area for the first time. A 6,300 meter drilling campaign is being planned and will be focused on the Consuzo zone including the four main mantos of sedimentary rocks located in the southern part of the property and the high potential skarn type mineralization (especially at the contact zone between the batholith intrusive body and the limestone formations). Finally, underground exploration/development work will be focussed on the areas that are currently being mined (Huaura and Huayllapon) in order to continue successfully replacing the mined resources with new resources. 

Pierre Monet, Malaga's new President has recently commented on the exploration results and the company's plans for 2011 "I was very pleased to see that, in 2010, 2 out of 4 drill holes were very successful and have opened up new areas with a high potential for the discovery and extension of Pasto Bueno's tungsten resources. Looking forward to 2011, I am confident that we will discover new areas of WO3 mineralisation thanks to our exploration program and that this will enable Malaga to significantly increase its known tungsten resources at Pasto Bueno. At present there are 79 known tungsten mineralized veins including the newly discovered Sorpresa vein on the Pasto Bueno property of which 6 are in production." 

This Press Release has been read and approved by Alonso Sanchez, P. Eng. and Chief Geologist for Malaga Inc. He acts as the qualified person ("QP") for the Company and is a geologist affiliated to the American Institute of Professional Geologists (AIPG).

ABOUT MALAGA

Malaga Inc. owns and operates a mine in Peru and is one of the few companies outside of China that produces tungsten. Malaga is a low cost producer due to the availability of hydroelectric power at its Pasto Bueno property in Peru and has a current production capacity of 500 tpd. Future plans are to increase production and thoroughly explore the property to increase reserves and resources. Malaga also owns 10% of Dynacor Gold Mines (TSXV:DNG).

FORWARD-LOOKING INFORMATION

Certain statements in the foregoing may constitute forward-looking statements which involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Malaga or industry results to be materially different from any future result, performance or achievement expressed or implied by such forward-looking statements. These statements reflect management's current expectations regarding future events and operating performance as of the date of this news release.

To view the map of Pasto Bueno, please visit the following link: http://media3.marketwire.com/docs/PastoBuenoeng.pdf

Contact Information

  • Malaga Inc.
    Jean Martineau
    Exec.Chairman and CEO
    514-288-3224
    or
    Malaga Inc.
    Pierre Monet
    President
    514-288-3224
    or
    Corporate Strategy and Investor Relations
    Nicole Blanchard
    Sun International Communications
    450-973-6600
    Nicole.blanchard@isuncomm.com