Property Description
The San Lucas Polymetallic Property (“San Lucas Property”) consists of 18 mineral concessions covering 925.32 hectares. San Lucas has two prominent major structures, the Main Shear Zone and the Rosita Structure that converge near the north end of the property. Numerous other mineralized structures occur between these main structures and possibly beyond. The property holds silver-lead-zinc mineralization in shear systems. Compilation of information from previously mined underground workings along with low grade lead and zinc intercepts from the 2007 drill program suggest that there is potential for a large, low grade zinc-lead body of mineralization below higher grade silver intercepts intersected in near surface drill holes and workings. To date, Oremex has completed in excess of 7,000 metres of drilling (67 holes) on the property, defining a 3 kilometre long zone by drilling within a 4 kilometre zone outlined by surface mapping.
The mineral concessions are held by Minera Montana R.L. de C.V. (“Minera Montana”) a wholly-owned Mexican subsidiary of Oremex Resources Inc.
Location & Accessibility
The San Lucas Property is situated 86 kilometres north of the city of Durango via paved Mexico Highway 45 through the village of Guadalupe Aguilera to the village of Diez de Octubre and then on to San Lucas de Ocampo. Mexico Highway 45 passes through the property and dirt roads provide access to the property. The property is easily accessible year round.
Recent Activity
In 2005, Oremex undertook a 19 reverse circulation drill program (3,042 metres) complemented by geological mapping and sampling of outcrop exposures. Property scale geological mapping and sampling away from the Main Shear Zone was conducted. The drill program was recommended in the Technical Report by Peter Christopher, PhD., PEng., dated April 2003 and filed with Sedar by Oremex on October 2, 3003. The drill program outlined a silver-gold mineralized system with lead and zinc along a 1.6 kilometre strike length in a 4 kilometre long zone, traced by mapping, of better grade mineralization in a volcanic sequence of andesite and rhyolite. Drilling and mapping elsewhere on the property indicated that a carbonate (limestone) unit is projected to intersect the better mineralized zone 100 metres below the present drilling level. A follow-up phase of drilling was recommended to evaluate the potential for replacement-type mineralization and the expansion of the presently known zone.
During the first quarter of 2007, Oremex initiated a reverse circulation drilling program that resulted in 47 holes totaling 7,012 metres of drilling, to test extensions down dip and along trend of mineralization. The drill program was halted in early May 2007, due to budget concerns and further evaluation. In July 2007, the Company released highlights on 37 of the 47 drill holes (see News Release July 3, 2007). The program was designed to test extensions of mineralization both down dip and along strike to the mineralized zone identified in the 2005 drill program. The most significant results are contained in four holes which run along the main mineralized zone (see news release October 16, 2007).
Once all assays have been received, the Company plans to complete a detailed assessment of the 2007 drill program and plans for future exploration on the property.
Topography & Geology
Topography
The San Lucas Property is located near the eastern edge of the Sierra Madre Occidental physiographic province in the Llanuras Altas (High Plains) physiographic subprovince. Elevations on the property average about 1,900 metres and range from 1,860 metres in Arroyo Ojo Caliente to about 2,150 metres in the southeast part of the property. Basin and range structures of the area generally trend north-northwest.
The region is semi-arid. The area has hot, dry spring and summer climate with moderate winter temperatures that rarely result in freezing. A rainy season may occur between July and October. The area has low to moderate relief that results in large areas of quaternary alluvial cover and consists mainly of open ranch land with farming and orchards restricted to valleys with sources of water. The Arroyo Ojo Caliente, the principal drainage, has at least a small flow of water throughout the year. The arid climate produces abundant cactus, napal and agave. Irrigation allows farming of beans, corn and fruit and nut orchards.
Geology
The regional geological setting of the San Lucas Property is essentially the same as for the Tejamen Property. The geology and mineralization of the region is typical of the Llanuras Altas physiographic subprovince at the eastern edge of the Sierra Madre Occidental. Located in the southwest of this subprovince, San Lucas is mainly underlain by Cretaceous schists, phyllites and limestone with a thin (<200 metre) cover of mainly Eocene andesite and rhyolite tuffs and flows that together are enveloped by Oligocene to Micocene rhyolitic rocks. Vein type mineral deposits in volcanic rocks of the Sierra Madre Occidental are of the low or moderate sulfidation epithermal type.
Mineralization
San Lucas hosts quartz and in some cases quartz and calcite veins that contain disseminated pyrite, free gold, argentite, argentiferous galena, and sphalerite with occasional malachite and azurite after chalcopyrite. Vein zones generally occur in Eocene Lower Volcanic Complex rocks (LVC) that are windows in rhyolitic rocks of the Upper Volcanic Complex.
A four kilometre long, northeast-trending zone of alteration, brecciation, veining, shattering and mineralization transects San Lucas along the Main Shear Zone. The Main Shear Zone and its alteration halo measures up to 100 metres wide over its length.
Two parallel, northeast-tending (N55˚E) silver-bearing structures, called the Veta Grande (aso called Veta El Tiro) and Veta Realez (also called Veta El Relis) quartz veins are the two most prominent of several discontinuous quartz veins lying in a complex multi-splayed breccia that forms the Main Shear Zone. These and other veins are spaced from 30 metres to 50 metres apart, vary in width from 0.5 to 1.5 metres, and occur intermittently along 2 kilometres of the Main Shear Zone.
Higher grade mineralization includes an underground sample by Luismin that assayed 256 grams per tonne (“gpt”) Au and 391 gpt Ag over 0.55 metres. Current drilling results indicate the best grades occurring over the northerly 800 metres of the drilled portion of the Main Shear with results of up to 48 gpt Ag, 3.0 gpt Au, 0.78 % Pb and 1.17 % Zn over 11.5 metre true width.
The presence of limestone beneath the drill, which tested Eocene LVC rocks, provides excellent targets for developing higher grade replacement style mineralization at slightly deeper levels (50 to 100 metres) than recent drill intercepts along the Main Shear Zone. Similar targets could be developed east of the Main Shear. Higher grade skarn mineralization is also a possibility where limestone might lie adjacent to a suspected but buried intrusion.
History & Previous Workings
Gambusinos (informal miners) started small-scale workings in the San Lucas area in 1880s. The Veta Grande was worked at the end of the 19th century and was equipped with a small concentrator. Mining activity was suspended as a result of the Mexican revolution in 1910.
Consejo de Recursos Minerals (“CRM”, 1993) reported that in the 1980s small shipments were made from the Veta Grande, Noche Buena and El Refugio mines. CRM (1980), Luismin, Echo Bay (1995), and Kobex (1997) all conducted geological examinations and sampling programs on the property.
The Company acquired the property through an option agreement with Minera Montana in 2003, who in turn had optioned the property in 2000 and staked additional mineral concessions in 2001 and 2002 to protect extensions of known vein zones. Minera Montana surface mapped the Veta Grande structural zone and mapped and sampled the Noche Buena area. In September 2007, Mineral Montana became a wholly-owned Mexican subsidiary of Oremex Resources Inc.
Previous exploration conducted on San Lucas by CRM (1980), Luismin, Echo Bay (1995), Kobex Resources (1997-2000) and Minera Montana (2000-2003) concentrated on the Veta Grande structural zone. Limited previous mining and milling occurred on the Veta Grande zone prior to 1910 and in the 1980s small shipments were made to the Parrilla mill from the Noche Buena and El Refugio mines and the Veta Grande dumps. The previous miners concentrated on, and removed, only the highest grade portions of the narrow veins. Recent exploration has demonstrated that the higher grade veins are enveloped by alteration zones and stockwork vein zones that contain significant silver and in some cases gold and base metal values over wider intervals. Higher grade mineralization generally occurs in a temperature sensitive zone related to boiling of mineralizing solutions.
CRM (1980) sampled the Noche Buena area by collecting 82 samples over a 167 metre length of the Veta Grande (El Trio) vein that averaged 1.2 metres wide and 2.9 gpt Au, 106.61 gpt Au, 0.94% Pb, and 0.18% Zn. CRM also collected 29 samples over a 95 metre length of the El Relis vein that averaged 0.8 metres wide and 13.8 gpt Au, 67.05 gpt Ag, 0.72% Pb and 0.28% Zn. In addition, CRM sampled the extension of the Veta Grande vein on the adjacent Mina Grande claim by collecting 141 samples over a 610 metre length that averaged 0.90 metres wide and 5.6 gpt Au, 248.2 gpt Ag, 1.8% Pb and 0.2% Zn.
The Noche Buena area was sampled by Luismin and Echo Bay. Surface sampling of the Veta Grande and Veta Realez veins and wall rocks by Luismin returned values of 1.35 gpt Au and 73 gpt Ag over 1.5 metres to 15.3 gpt Au and 51 gpt Ag over 0.7 metres. An underground sample by Luismin assayed 256 gpt Au and 391 gpt Ag over 0.75 metes. Vuggy quartz stockwork, found between the two major quartz veins, was sampled by Echo Bay and by Oremex. The Oremex rock chip sampling returned weighted averages of 0.87 gpt Au and 39.9 gpt Ag over 30.5 metes. Echo Bay sampling returned values of 0.88 gpt Au and 31.4 gpt Ag over 30 metres on one line immediately to the southwest of Oremex’s sampling and 0.44 gpt Au and 31.2 gpt Ag over 30 metres on a second line immediately to the northeast of the Oremex sample line.
In his Technical Report on the San Lucas Property, April 2003, Dr. Peter Christopher, P.Eng., confirmed that he had collected six chip samples from the stockwork veined and altered zone around the Veta Grande structure. Dr. Christopher's samples showed an average value of 97 gpt Ag and support the presence of a significant mineralized zone that warrants further work.
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