Gold Resource Corporation (NYSE MKT:GORO) a gold and silver producer with operations in Mexico, continues to define multiple robust, high-grade, polymetallic veins.
The miner has intercepted multiple high grade parallel veins including 15.64 meters of 2.85 grams per tonne gold, 169 grams per tonne silver at Hole 515040, expanding the new polymetallic Switchback vein system’s mineralization at its El Aguila project in Mexico.
"We are excited to commence another round of Switchback drilling this fall from a closer distance and better angle to test above the high-grade just intercepted in Hole 515040. The goal of the next phases of Switchback drilling is to upgrade current mineralized material to the reserve category, as well as continued step-outs to test the extensions of this growing high-grade epithermal system,” said Gold Resource Corp’s vice-president of exploration, Barry Devlin.
The company first announced the Switchback, located just 500 meters northeast from its producing La Arista gold, silver and base metals underground mine in June 2013. It is a parallel structure to the Arista deposit, which had previously been mapped at surface. The structure is one of several parallel to the Arista deposit that the gold miner is targeting with its ongoing drilling in order to extend the Arista system.
"These recent Switchback drill results, including 15.64 meters of 2.85 grams per tonne gold, 169 grams per tonne silver, 0.52% copper, 1.60% lead and 10.16% zinc, remind me of the exciting evolution of the Arista discovery and its early delineation phase," said Gold Resource Corp's president and CEO, Jason Reid.
Hole 515040, a 50 meter step-out hole, has expanded high-grade mineralization to the northwest and at the highest elevation to date, said the company in a statement. The Hole also returned 0.52% copper, 1.60% lead and 10.16% zinc, including 6.59 meters grading 3.02 g/t gold, 134 g/t silver, 0.67% copper, 2.42% lead and 16.14% zinc.
Four of the five holes included in this latest round of drilling also intercepted polymetallic mineralization containing gold, silver, copper, lead and zinc, delineating the Switchback's mineralized horizon to 450 meter strike by 450 meter depth. It remains open in all directions.
Gold Resource said that almost all reported drill intercepts contain significant percentages of zinc ranging up to 29.20%. The presence of zinc and other base metal by-products increases the dollar value per tonne net smelter return (NSR) of the ore.
The company said it has started drifting underground from Arista towards Switchback in order to reach the latter’s mineralized veins by the end of this year, planning to extract mineral from Switchback the first half of 2016:
"There is a very good chance we have found the next Arista deposit at Switchback, or perhaps it's an extension of Arista, which speaks to the growing potential of this epithermal system. Our plan to touch the mineralization by year-end could see us pulling tonnes for mill feed during the first half of 2016," said Reid.
The company has started planning to build a third drill station to secure a more advantageous distance and drill angles to continue exploration, delineating high-grade mineralization at Switchback, where another round of drilling should begin later in 2015.
The gold and silver producer with operations in Oaxaca, Mexico and exploration in Nevada, USA has returned over $103 million to shareholders in monthly dividends since the start of commercial production in July 1, 2010.
Gold Resource Corp reported a net income of US$5.1 million, or US$0.09/share for the first quarter of 2015 on sales of US$28.4 million, all generated at its Aguila Project in Mexico, based on the production of 19,347 of precious metal gold equivalent (AuEq) ounces.
The company says it remains on track to reach its annual production outlook of 80,000 to 90,000 AuEq ounces at a 64.1:1 ratio.
The favorable Q1 2015 results follow a stellar 2014 annual performance for Gold Resource, which last March recorded its highest annual production ever for both gold and silver and 28 percent lower cash costs.