Samco Gold Limited
TSX VENTURE : SGA

Samco Gold Limited

July 10, 2012 08:34 ET

Samco Gold Intersects 5.5M With 11.2 g/t Au and 57 g/t Ag at the Herradura Target of Its El Dorado Monserrat Project

TORONTO, ONTARIO--(Marketwire - July 10, 2012) - Samco Gold Limited (TSX VENTURE:SGA) ("Samco Gold" or the "Company") is pleased to announce the early stage results of its drill program on the Herradura target at its principal El Dorado Monserrat (EDM) project:

HIGHLIGHTS

Following a program of geological mapping and pole dipole geophysics, drilling commenced in the first week of April, 2012, and by June 30, 27 holes had been completed, totaling 6,571 metres. Two zones of mineralization have so far been encountered:

(1) Quartz-pyrite breccia

  • Exploration drilling intersected a zone of intense quartz veining overprinted and brecciated by pyritic mineralization, between approximately 60 and 140m down-hole (HDDH001).
  • The mineralized body was intersected in HDDH007, HDDH009, HDDH010, HDDH011, and HDDH12, with the results shown in Table 1. The best intersection received to date comprises 31m averaging 1.5 g/t Au, 57 g/t Ag from 163 metres (in HDDH011).

(2) East-west quartz vein

  • Four holes (HDDH013, HDDH014, HDDH015 and HDDH026) were drilled to the west of the breccia zone.
  • HDDH013 intersected 5.5m of 11.2 g/t Au, 73 g/t Ag from 68 m.
  • HDDH015 intersected 4m averaging 2.03 g/t Au, 42 g/t Ag from 148m. (The true width for both intersections is estimated at between 1.5m and 2.5m).
  • HDDH014 intersected 1m of 4.14 g/t Au, 17 g/t Ag at 111-112m, at approximately 90m below the surface.
  • The vein intersections in these three holes are interpreted as a single structure, at least 500m long.

INTRODUCTION

The La Herradura prospect is located approximately 7 km south-east of the Monserrat target, within Samco Gold´s El Dorado block of tenements. (Figure 1 - http://media3.marketwire.com/docs/samcofig1.pdf). The prospect is a low hill, distinctive for its red colour due to iron oxide and clay alteration.

Figure 1. El Dorado project, showing location of the Herradura target. To view Figure 1 please visit the following link: http://media3.marketwire.com/docs/samcofig1.pdf.

Another company explored the prospect in 1998, by geological mapping, trenching, rock chip sampling, and five cored holes which totaled 657m. The trenching and rock chip sampling identified a number of narrow, NW to WNW trending quartz veins, in some of which assays above 10 g/t Au were reported. The drill-holes were reported to have intersected several broad zones of anomalous Au-Ag mineralization, including:

  • 29.8m of 0.27 g/t Au, 1 g/t Ag in DDH1
  • 29.2m of0.25 g/t Au, 5 g/t Ag in DDH3
  • 45.4m of 0.2 g/t Au, 2 g/t Ag in DDH5

EXPLORATION BY SAMCO GOLD

Samco Gold commissioned a pole-dipole induced polarization survey on lines 100m apart in late 2011, compiled data from the 1998 exploration, and carried out preliminary geological mapping. Drilling commenced in the first week of April, 2012, and by June 30, 27 holes had been completed, totaling 6,571 metres. Concurrent with the drilling, more detailed geological mapping was carried out over the main Herradura prospect as part of a structural study by structural geologist Dr. David Coller.

GEOLOGICAL INTERPRETATION

The Herradura target comprises a volcanic complex comprising bedded tuffs which overlie porphyritic dacitic volcanics, rhyolite, and minor andesite. The complex is underlain by basaltic andesite which crops out extensively to the east of Herradura, and forms a 'basement' to the volcanic complex. The basaltic andesite hosts a WNW-trending vein system known as Beethoven (Figures 1 - http://media3.marketwire.com/docs/samcofig1.pdf and 2 - http://media3.marketwire.com/docs/samcofig2.pdf).

Relationships between the volcanic units are complex, and the geological interpretations shown on Figures 2, 3 and 4 are provisional. Bedded volcanic units generally dip south-west, probably due to tilting associated with faulting, but are also locally folded. The contact between 'basement' andesite and the overlying more felsic volcanics is thought to be (at least in part) a low-angle graben fault which dips to the north below most of the veins (Figures 2 - http://media3.marketwire.com/docs/samcofig2.pdf, 3 - http://media3.marketwire.com/docs/samcofig3.pdf and 4 - http://media3.marketwire.com/docs/samcofig4.pdf). Mineralization seems to be preferentially developed in the hangingwall of the graben fault, mostly in dacitic units, but as shown below, does not appear to be truncated or displaced by the fault.

RESULTS

Intersections above 1 g/t Au equivalent (g/t Au plus g/t Ag/60) are listed in Table 1. (At Herradura, a 1 g/t lower limit has been chosen arbitrarily, so as to include zones of low-grade mineralization, but further exploration may indicate that a different lower limit is more appropriate).

Figure 2. Herradura prospect, showing drill-hole locations and simplified geology. Holes pending results are shown in black. To view Figure 2 please visit the following link: http://media3.marketwire.com/docs/samcofig2.pdf.

Two zones of mineralization have been intersected by the current drill-holes at La Herradura:

1. Quartz-pyrite breccia

HDDH001 intersected a zone of intense quartz veining overprinted and brecciated by pyritic mineralization, between approximately 60 and 140m down-hole. Subsequent holes aimed to define the extent of this mineralization.

The mineralized body was intersected in HDDH007, HDDH009, HDDH010, HDDH011, and HDDH12, with the results shown in Table 1. The best intersection is in HDDH011 (31m averaging 1.5 g/t Au, 57 g/t Ag). HDDH022 was drilled to explore this intersection down-dip, but did not intersect appreciable mineralization. It passed through a faulted contact between dacite and andesite between 250 and 266m (Figure 3 - http://media3.marketwire.com/docs/samcofig3.pdf), assumed to be the NE-dipping graben fault shown on Figure 2.

Figure 3. Cross section 2250E, looking WNW, showing drill-holes, intersections (width in m, g/t Au/g/t Ag) and interpreted geology. See Figure 2 for section line. To view Figure 3 please visit the following link: http://media3.marketwire.com/docs/samcofig3.pdf.

2. East-west quartz vein

HDDH013, HDDH014, HDDH015 and HDDH026 were drilled west of previous holes, partly to test a small quartz outcrop, about 1.5m wide, as well as silicified volcanics which form a low ridge. Assays have been received for HDDH013, HDDH014 and HDDH015 as follows:

HDDH013 intersected 5.5m of 11.2 g/t Au, 73 g/t Ag from 68 m, approximately 65m below the surface (Figure 4). As shown below, the vein probably dips at 80° S, so the intersection was at a low angle to the core, consistent with a true width of 1.5m.

HDDH013 intersected a second zone of lower grade mineralization (3.0m of 2.9 g/t Au, 171 g/t Ag from 170.7m) in a breccia with quartz vein clasts, above the faulted contact between dacite and andesite. Including an adjoining zone of intense fracturing and anomalous values below the breccia, the entire interval from 170.7m to 177.7m averages 1.6 g/t Au, 95 g/t Ag, as shown on Figure 4. It is not yet clear whether this intersection is associated with the fault shown on Figure 4, or is equivalent to the quartz-pyrite breccia zone to the east described above.

Figure 4. Cross section 2050E, looking WNW, showing drill-holes, interpreted geology, and intersections (width in m, g/t Au/g/t Ag). See Figure 2 for section line. To view Figure 4 please visit the following link: http://media3.marketwire.com/docs/samcofig4.pdf.

HDDH014 intersected 1m of 4.14 g/t Au, 17 g/t Ag at 111-112m, at approximately 90m below the surface, in dacite. The intersection is 500m west of HDDH013.

HDDH015 intersected 4m averaging 2.03 g/tAu, 42 g/t Ag between 148 and 152m 200m west of HDDH013 (Figure 5 - http://media3.marketwire.com/docs/samcofig5.pdf). The relationship with the vein outcrop indicates a dip of 80° towards the south and a true width of about 1.5m. The intersection is at approximately 130m below the surface.

The vein intersections in these three holes are interpreted as a single structure, at least 500m long.

Figure 5. Cross section, 1850E, looking WNW, showing drill-holes, interpreted geology, and intersection (width in m, g/t Au/g/t Ag. See Figure 2 for section line. To view Figure 5 please visit the following link: http://media3.marketwire.com/docs/samcofig5.pdf.

The fourth hole, HDDH026 is mid-way between HDDH013 and HDDH015. It also intersected quartz veining from 111 to 118.4m in the projected position of the vein at approximately 100m below the surface, with assays pending.

Holes HDDH024, HDDH025 and HDDH027 were drilled to test the structure down-dip from the intersections in HDDH013, HDDH015 and HDDH026.

  • HDDH024 intersected a fractured quartz vein at 220.5-223m, in the footwall andesite (Figure 4). The intersection is approximately 140m down-dip from the vein in HDDH013, and 210m below the surface. It is consistent with a dip of 80° S for the vein, which would give a true width of 0.8m in HDDH024.
  • HDDH025 intersected tuff, dacite and andesitic volcanics to its final depth of 291m. It would not have been deep enough to intersect the projection of the vein at the assumed dip of 80° S to vertical, so is inconclusive.
  • HDDH027 Intersected a fault zone at 218-226m, with dacite above and andesite below. It is not clear whether this is the main graben fault, but as with HDDH025, the hole was not deep enough to reach the vein if it dipped south.

These results show that the Herradura target has considerable untested promise. The east-west vein has been intersected over a length of 500m in five holes, and pending assays, especially from HDDH024 and HDDH026, will help to determine its potential. A good understanding of the complex geology of this prospect is a key element of continued exploration. The Company intends to extend the detailed geological mapping already commenced, after the winter break.

Commenting on the recent results Paul Richardson, Chief Executive of Samco Gold said:

"We are very pleased with these initial results from the Herradura target which, as with other targets on our highly prospective EDM property, is demonstrating great potential. We look forward to continuing to test these potentially significant structures in future drilling campaigns."

Table 1. Collar details of holes drilled at Herradura and results received

Hole E N Azimuth Angle Depth g/t Au g/t Ag Width From
HDDH001 2532304 4632920 197 -60 296 1.04 27 3.0 128
HDDH002 2532267 4632783 197 -60 191.9 NSV
HDDH003 2532730 4632654 197 -60 258 NSV
HDDH004 2532414 4632615 197 -60 305 NSV
HDDH005 2532329 4632660 197 -60 276 NSV
HDDH006 2532360 4632756 197 -60 285 NSV
HDDH007 2532491 4632869 197 -60 270 2.7 15 3.0 83
HDDH008 2532455 4632729 197 -60 105 NSV
HDDH009 2532404 4632898 197 -60 195 1.8 29 2.0 93
HDDH010 2532418 4632944 197 -60 273 1.8 5 2.0 127
0.5 67 3.0 172
HDDH011 2532330 4632964 197
-60
291 2.8 49 3.3 126.5
1.3 86 5.0 147.7
1.5 57 31.1 163
HDDH012 2532224 4632940 197 -60 240 NSV
HDDH013 2532132 4632993 197 -60 234 11.2 73 5.5 68
1.5 18 2.0 84.5
2.9 171 3.0 170.7
HDDH014 2531629 4632962 197 -60 234 4.1 17 1 111
HDDH015 2531928 4632994 197 -60 216 2.0 42 4 148
HDDH016 2532593 4632350 197 -50 36 Pending
HDDH017 2532785 4632834 197 -50 186 NSV
HDDH018 2532352 4632376 197 -50 231 NSV
HDDH019 2532275 4632461 197 -60 222 Pending
HDDH020 2532303 4632538 197 -60 201 Pending
HDDH021 2532020 4632630 197 -60 198 Pending
HDDH022 2532344 4633012 197 -60 336 Pending
HDDH023 2532444 4633018 197 -60 312 Pending
HDDH024 2532147 4633043 197 -60 321 Pending
HDDH025 2531947 4633074 197 -60 291 Pending
HDDH026 2532029 4632990 197 -60 264 Pending
HDDH027 2532051 4633066 197 -60 303 Pending
NSV: No results >1 g/t Au equivalent.

Note : Coordinates in italics with elevations are final (by differential GPS), others are provisional.

The exploration program is directed by Samco Gold's Senior Geologist, Lic. Eduardo Falloni advised by Mr. David Shatwell who is a Fellow of the Australian Institute of Geoscientists. Sr. Falloni has over 30 years' experience of exploration geology throughout Argentina including significant experience within the Deseado Massif. Mr. Shatwell is a Qualified Person within the meaning of Canadian National Instrument 43-101 and has reviewed and approved the above technical disclosure.

The above Au and Ag assays were performed on half-core by Alex Stewart Argentina S.A., using fire assay with atomic absorption finish on 50 gram pulp samples. Drill-hole locations are in Gauss-Kruger coordinates, using the Campo Inchauspe datum, and were acquired by hand-held GPS with an estimated accuracy of approximately 5m. Unless otherwise stated, intersections quoted in this release are down-hole widths, and are greater than true widths depending on vein and drill-hole geometries.

About Samco Gold Limited

Samco Gold's principal business is the acquisition, exploration and development of precious metals resource properties in Argentina. The Company's principal mineral property is the El Dorado Monserrat epithermal gold project, located in the Deseado Massif region of Santa Cruz Province, Argentina. The Company's goal is to become a producer of gold through the exploration and development of El Dorado Monserrat. Samco Gold also owns a portfolio of other mineral exploration properties in the Deseado Massif.

Additional details on the Company are available on SEDAR (www.sedar.com).

FORWARD LOOKING STATEMENTS

This press release contains forward-looking statements which can be identified by the use of words "commenced", "scheduled", "expect", "goal", and phrases or statements that certain actions, events or results "may", "would", or "will" be taken, occur or be achieved. Information concerning the interpretation of drill and other exploration results may also be considered forward-looking statements as such information constitutes a prediction of what mineralization might be found to be present if and when a project is actually developed.

Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the results of due diligence activities, the interpretation and actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of gold; possible variations in grade or recovery rates; failure of equipment or processes to operate as anticipated; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of exploration, as well as those factors disclosed in Samco Gold's Prospectus dated June 27, 2011 filed and publicly available under the Company's profile on the SEDAR website at www.sedar.com. Although Samco Gold has 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. The Company does not intend, and does not assume any obligations, to update forward-looking statements, whether as a result of new information, future events or otherwise, unless otherwise required by applicable securities laws.

To view the figures associated with this press release, please visit the following links:

Figure 1. El Dorado project, showing location of the Herradura target: http://media3.marketwire.com/docs/samcofig1.pdf.

Figure 2. Herradura prospect, showing drill-hole locations and simplified geology. Holes pending results are shown in black: http://media3.marketwire.com/docs/samcofig2.pdf.

Figure 3. Cross section 2250E, looking WNW, showing drill-holes, intersections (width in m, g/t Au/g/t Ag) and interpreted geology. See Figure 2 for section line: http://media3.marketwire.com/docs/samcofig3.pdf.

Figure 4. Cross section 2050E, looking WNW, showing drill-holes, interpreted geology, and intersections (width in m, g/t Au/g/t Ag). See Figure 2 for section line: http://media3.marketwire.com/docs/samcofig4.pdf.

Figure 5. Cross section, 1850E, looking WNW, showing drill-holes, interpreted geology, and intersection (width in m, g/t Au/g/t Ag. See Figure 2 for section line: http://media3.marketwire.com/docs/samcofig5.pdf.

Neither the 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.

Contact Information

  • Samco Gold Limited
    Paul Richardson
    Chief Executive Officer
    +44 20 7740 5791
    pr@samcogold.com