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090109 Durgin Cieneguita 43 101 Dec 08 Final

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  • 1. Delve Consultants, LLC. Mineral Exploration and Development TECHNICAL REPORT – RESOURCE UPDATE CIENEGUITA PROJECT CHIHUAHUA, MEXICO Prepared for MEXORO MINERALS LIMITED December 5, 2008 Dana Durgin CPG #10364 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 1
  • 2. Delve Consultants, LLC. Mineral Exploration and Development TABLE OF CONTENTS Section Page 1.0 EXECUTIVE SUMMARY 1 1.1 Introduction 1 1.2 Geology and Mineralization 1 1.3 Exploration and Mining History 1 1.4 Drilling and Sampling 1 1.5 Metallurgical Testing 2 1.6 Mineral Resource Estimation 2 1.7 Interpretation and Conclusions 3 1.8 Recommendations 3 2.0 INTRODUCTION AND TERMS OF REFERENCE 5 3.0 RELIANCE ONOTHER EXPERTS 7 4.0 PROPERTY DESCRIPTION AND LOCATION 7 4.1. Location 7 4.2 Land Area 8 5.0 ACCESS; CLIMATE; LOCAL RESOURCES; INFRASTRUCTURE; AND 11 PHYSIOGRAPHY 6.0 HISTORY 11 6.1 Recent Exploration History 11 7.0 GEOLOGIC SETTING 11 7.1 Regional Geology 11 7.2 LocalGeology 11 7.2.1 Intrusive Breccia 13 8.0 DEPOSIT TYPES 14 8.1 Epithermal Systems 14 8.2 Porphyry Systems 15 8.3 Diatreme Breccia 15 9.0 MINERALIZATION 15 9.1 Quartz-biotite-orthoclase-adularia-calcite (Low Sulfidation) 16 9.2 Quartz-sericite-pyrite (High Sulfidation) 16 9.3 Hematite-goethite 16 9.4 Inter-caldera Megabreccia 16 9.6 Diatreme Breccia 17 10.0 EXPLORATION 18 11.0 DRILLING 18 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 ii
  • 3. Delve Consultants, LLC. Mineral Exploration and Development 11.1 Drilling Summary 18 11.2 Core Drilling and Logging 22 12.0 SAMPLING METHOD AND APPROACH 22 12.1 Sampling Summary 22 12.2 Core Sampling 22 13.0 SAMPLE PREPARATION, ANALYSIS AND SECURITY 23 13.1 Sample Preparation 23 13.2 Analytical Procedures 23 14.0 DATA VERIFICATION 23 14.1 Quality control 23 14.2 Historic Drilling Data 24 15.0 ADJACENT PROPERTIES 24 16.0 MINERAL PROCESSING AND METALLURGICAL TESTING 24 17.0 MINERAL RESOURCE ESTIMATE 25 17.1 Definitions 26 17.2 Data 26 17.3 Deposit Geology Pertinent to Resource Estimation 26 17.4 Density 27 17.5 Resource Modeling 27 17.6 Cieneguita Inferred Resource 32 17.6.1 Metallurgical Considerations 33 17.6.2 Mining Considerations 33 17.6.3 Upgrading the Resource Classification 34 18.0 MINERAL RESERVE ESTIMATE 34 19.0 OTHER RELEVANT DATA AND INFORMATION 34 20.0 INTERPRETATIONS AND CONCLUSIONS 35 21.0 RECOMMENDATIONS 36 21.1 Cieneguita 37 21.2 Program and Budget 38 21.3 District Exploration 38 22.0 REFERENCES 39 23.0 DATE AND SIGNATURE PAGE 40 23.0 CERTIFICATE OF AUTHOR 41 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 iii
  • 4. Delve Consultants, LLC. Mineral Exploration and Development LIST OF TABLES Table Page Table 4.1 Claim Information For the Cieneguita Property 8 Table 10.1 Cieneguita Drilll Hole Intercepts 19 Table 17.6 Results of May 2007 Cyanidation Study 25 Table 21.2 Cieneguita Project Exploration Budget 38 LIST OF FIGURES Figure Page Figure 4.1 Location Map 9 Figure 7.1 Cieneguita District Geology 12 Figure 7.2 Cieneguita Deposit Geology With Drill Holes 13 Figure 7.2.1 Cieneguita Longtitudinal Section 14 Figure 17.5.1 Cieneguita Cross Section Grid 28 Figure 17.5.2 Cieneguita Resource Blocks 29 Figure 17.5.3 Representative Cross Section – Eastern Resource Blocks 30 Figure 17.5.4 Representative Cross Section – Western Resource Blocks 31 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 iv
  • 5. Delve Consultants, LLC. Mineral Exploration and Development 1.0 EXECUTIVE SUMMARY This technical report was prepared by Delve Consultants at the request of Mexoro Minerals Limited, a United States (Colorado) corporation, listed on the Over The Counter Bulletin Board as MXOM, in connection with its filings with British Columbia Securities Commission. The report was written in compliance with disclosure and reporting requirements set forth in the Canadian Securities Administrators’ National Instrument 43-101, Companion Policy 43-101CP, and Form 43-101F1. The resource estimate contained herein for the Cieneguita deposit was prepared by Dana Durgin in November 2008. No mineral reserves were estimated. Mr. Durgin (the author) is a qualified person under Canadian Securities Aministrators’ National Instrument 43-101. The author has independently investigated the data provided to him by Mexoro Minerals Limited to the extent deemed necessary in his professional judgment for him to be able to reasonably rely on this information. 1.1 Introduction The Cieneguita project is located southwestern Chihuahua in northern Mexico, and is 375 km by road from the state capital, Chihuahua City. The project is about 30 km south of the town of Cerocahui, adjacent to the village of Cienequita. It is part of the Sierra Madre Occidental silver- gold belt. The centre of the property is located at latitude 27 degrees 8 minutes North and longitude 108 degrees 12 minutes (WGS 1984, UTM zone 12, 3003848N, 795718E). 1.2 Geology and Mineralization At the Cieneguita project, disseminated gold-silver-lead-zinc mineralization is hosted by a diatreme breccia, which has the appearance of a coarse, poorly sorted, poorly consolidated felsic tuff. Disseminated pyrite, galena, sphalerite and chalcopyrite are spatially associated with widespread sericitic and argillic alteration. The diatreme body has the appearance of a flattened funnel, approximately 1000 meters long and 200 meters wide, and dips nearly vertically. Host rocks are andesitic volcanic rocks of lower Tertiary age. This is the first mineralized diatreme breccia described in the region. 1.3 Exploration and Mining History In general, the region has a mining history dating to the early Spanish colonial days. The church at nearby Cerocahui was built in 1620. There was no significant mining activity in the immediate area of Cieneguita until Cominco drilled 51 diamond drill holes (6700m) in 1981 and 1982. Glamis Gold completed drilling programs in 1994 and 1997. From 1995 to 1998, the Cieneguita deposit was a producing mine operated by Glamis. From 1995 to 1998, an indicated 197,993 metric tonnes of oxidized ore grading at 2.27 grams per tonne gold (g/t Au) was mined from the Cieneguita Property. Mexoro began its ongoing diamond drilling program in December 2007. 1.4 Drilling and Sampling 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 1
  • 6. Delve Consultants, LLC. Mineral Exploration and Development The quality and technical specifications of sampling techniques and procedures of any drilling done prior to that of Mexoro are not well known. The precise hole locations of most of the earlier generations of drilling cannot be ascertained with certainty due to mining activity and time having erased much of the prior survey grid. Mexoro initiated the ongoing diamond drilling program in December 2008, using GDA Servicios Mineros, as the contractor. As of late September 2008, at total of 12,939 meters of HQ (2.5 inch core) drilling had been completed in 62 drill holes. Core recovery has been excellent. All of the core in each hole has been photographed, logged in detail, split, sampled, and assayed by Chemex Laboratory for silver and gold as well as a suite of trace elements. The drilling program has the goal of completing a total of 20,000 meters of core drilling by the end of 2008 using two drilling rigs. 1.5 Metallurgical Testing In May of 2007, a metallurgical report was released on a cyanidation study of gold and silver bearing samples of largely oxidized material taken from the Cieneguita Property by the Servicio Geologico Mexicano. There were a total of six samples that were subjected to the cyanidation process by using a bottle roll system and agitating the samples for 24, 48 and 72 hours respectively. Results for these samples ranged from 39.11 % up to 91.61 % dissolution for gold and 21.62 % to 56.44 % dissolution for silver (Servicio Geologico Mexicano, May 2007). Additional metallurgical testing is planned with a focus on sulfide mineral recoveries, most likely using flotation processes, which will be necessary in resource modeling, but has not yet been done. 1.6 Mineral Resource Estimation This Technical Report was prepared largely as a supplement to Mr. Besserer’s April, 2008 report to describe the process used in, and the results from, an inferred resource calculation done by the author. It was a cross section-based, manually done (not computer modeled) process. Via the construction of a set of orthogonal sections, with surface and drillhole geology and assays plotted on each section, a three-dimensional geologic model was compiled. Assays were composited using the sum of the dollar values for Au, Ag, Pb and Zn in each drill interval. Three-year trailing average prices used were: gold = $727.22 per ounce, silver = $13.66 per ounce, lead = $1.00 per pound, zinc = $1.36 per pound. A cutoff of $30 was applied and weighted averages calculated for each above-cutoff interval. These intervals were projected between drill holes and between sections to produce resource blocks, which were then compiled using weighted averages to produce a total tonnage and grade with a dollar value per ton. The total in-situ resource was calculated to be: 15.25 million tons at a dollar value of $61.37 per ton – or 2.62 grams gold- equivalent per ton. Individual metals grades were: Au = 0.67 g/t (328,638 oz), Ag = 56.45 g/t (27,675,709), Pb = 0.334% (110,862,184 lb), Zn = 0.475% (142,119,096 lb). This is an in-situ, inferred resource with no consideration for metallurgical recoveries since no flotation studies have been done at this time. Using the closely analogous Montana Tunnels deposit as a model and their historic metal recoveries of Au (81.9%), Ag (73.8%), Pb (86.5%) & Zn (85%), produces the following 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 2
  • 7. Delve Consultants, LLC. Mineral Exploration and Development potentially recoverable resource: 15.25 million tons at Au = 0.549 g/t (269,155 oz Au), Ag = 41.66 g/t (20,424,671 oz Ag), Pb = 0.298% (88,110,790 lb), Zn = 0.396% (120,801,231 lb). Smelters commonly pay for 95% or more of the contained gold and silver, 60% of the zinc and 45% of the lead. After those deductions, the total recovered and payable resource is calculated to be: 15.25 million tons at Au = 0.522 g/t (255,697 ounces Au), Ag = 39.58 g/t (19,403,440 oz Ag), Pb = .0179% (52,866,474 lb), and Zn = 0.178% (54,360,554 lb). Of course these are estimates based on the assumptions that the deposit is metallurgically analogous to Montana Tunnels and that the three-year trailing average metal prices used are appropriate. 1.7 Interpretation and Conclusions From his review of data provided by Mexoro, the author believes that the data are generally an accurate and reasonable representation of the Cieneguita project. Mexoro’s ongoing exploration program has delineated a gold and silver resource with significant base metal values. These resources are classified as Inferred Resources, as defined by CIM. These have been estimated based on geological evidence and reasonably assumed, but not verified, geological grade and continuity. These resources may change to Indicated or Measured Resources as more data is obtained and more sophisticated methods of deposit modeling, statistical treatment of data, and improved data verification procedures are applied. It cannot be assumed that all such resources will be converted to Indicated and Measured Resources, however the author believes that such improvements will lead to definition of resources in higher categories for at least a significant portion of the deposit. In addition, the resources described remain open among and lateral to inferred resource blocks and in depth. The drilling program on which this resource calculation has been based was done at a nominal hole spacing of 80 meters. Additional drilling is clearly warranted both as infill of the known resource area and as step-out drilling peripheral to the known resource. This program is in progress. 1.8 Recommendations The ongoing infill and close step-out drilling is in progress with the goal of providing the necessary data to carry the resource forward into the Indicated and Measured categories. Completion of the drilling program on a 40-meter hole spacing will greatly increase the geologic and assay control necessary to refine the resource calculation and highlight areas that need additional drilling. In order to convert Inferred Resources into the Indicated and Measured categories it will be necessary to use and monitor a more complex data verification system including submitting additional standard and duplicate samples, twinning holes and doing check assays with other labs. A more sophisticated approach to deposit modeling will be needed. A computer generated model with integrated geology based on more closely spaced drilling will allow statistical treatment of the assay data, as well as provide more reliable and accurate resource estimates. 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 3
  • 8. Delve Consultants, LLC. Mineral Exploration and Development Initial metallurgical testing which envisions processing the mineralized material by flotation techniques is highly recommended. This will also guide future more detailed work. Initial baseline studies of potential environmental and social issues should be begun in a proactive effort to prevent potential problems. The budget to accomplish these goals early in 2009 is estimated at $1.650,000. 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 4
  • 9. Delve Consultants, LLC. Mineral Exploration and Development 2.0 INTRODUCTION AND TERMS OF REFERENCE Delve Consultants has prepared this technical report regarding the Cieneguita Project at the request of Mexoro Minerals Limited. It is written as a supplement to a Technical Report written by Dean Besserer of Apex Geoscience Ltd., dated April 28, 2008. Besserer’s report did not include a resource estimate. A recently completed resource estimate is the principal subject of this technical report. The sections in this report regarding project location, history, regional geology, property geology, drilling procedures, sampling procedures, analytical procedures and Qa/Qc are generally taken directly from Besserer’s report with his permission. Modifications were made to these sections only if there were procedural changes or more data available. The writing of this Technical Report was triggered by a press release describing the estimated resource, dated August 28, 2008 This will satisfy Mexoro’s obligation to file a technical report as public information in connection with this recent press release, as required under the policies of the British Columbia Securities Commission. This report is written in compliance with disclosure and reporting requirements set forth in the Canadian Securities Administrators’ National Instrument 43-101, Companion Policy 43-101CP and Form 43-101. An inferred resource estimation was completed by the author, Dana Durgin, in late November 2008, from data made available by Mexoro; no reserves were estimated. The author carried out such independent investigations of the data and of the property in the field as has been deemed necessary in the professional opinion of the author, so that he might reasonably rely on this information. The author reviewed pertinent technical reports and data provided by Mexoro relative to the regional and property geology, land status, history of the district and of the project, past and present exploration efforts and results, methodology, interpretations, and other data necessary to the understanding of the project, sufficient to produce this report. He accompanied Mr. Besserer at the time that he made his visit early in 2008, and critically reviewed Mr. Besserer’s report. He has also worked in the area for other clients and is familiar with the regional and local geology. The drilling assay and geologic data required to produce this report was generated during an ongoing diamond drilling program, which was begun by Mexoro in December, 2007. The author has relied on that data for the geologic modeling and resource estimation portion of this report. The conclusions made in this report were based on the author’s review of that data and limited additional data acquired independently, as well as two days spent at the project in the field. As mandated by NI 43-101 requirements, the observations, conclusions and recommendations of the author in this report are derived from the review of that data and a site inspection on January 12, 2008, and September 21, 2008. These site inspections included a review of available data at Mexoro’s office in Chihuahua City, an inspection of mineralization exposed in surface outcrops and workings, and in extensive trenching at the project. The author believes that the data presented to him by Mexoro Minerals Limited are generally a reasonable and accurate representation of the Cieneguita gold project. Units of measure, conversion factors and currency used in this report are as follows: 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 5
  • 10. Delve Consultants, LLC. Mineral Exploration and Development Linear Measure 1 inch = 2.54 centimeters = 254 millimeters 1 foot = 0.3048 meter 1 yard = 0.9144 meter 1 mile = 1.6 kilometers Area Measure 1 acre = 0.4047 hectare 1 square mile = 640 acres, or 259 hectares Capacity Measure (liquid) 1 US gallon = 4 quart or 3.785 liters Weight 1 short ton = 2000 pounds = 0.907 tonne 1 pound = 16 oz = 0..454 kg = 14.5833 troy ounces Analytical Values 1% percent Grams per Troy ounces metric tonne per short ton 1% 1% 10,000 291.667 1 gm/tonne 0.0001% 1 0.0291667 1oz troy/ton 0.003429% 34.2857 1 100 ppb 0.0029 100 ppm 2.917 Commonly used abbreviations and acronyms AA atomic absorption spectrometry Ag silver Au gold CIM Canadian Institute of Mining, Metallurgical and Petroleum core diamond drilling method, producing a cylinder of rock FA-AA fire assay with an atomic absorption finish g grams g/t Ag grams of silver per metric tonne, equivalent to ppm g/t Au grams of gold per metric tonne, equivalent to ppm 2881 Fargo Way, Sparks, NV 89434 Tel/Fax 775-356-6121 6
  • 11. Delve Consultants, LLC. Mineral Exploration and Development g/t AU-eq grams per metric ton expressed in gold-equivalent. A calculation based on the following metal prices: gold = $844 per ounce, silver = $15.60 per ounce, lead = $0.75 per pound, zinc = $0.90 per pound. Formula: g/t Au-eq = g/t Au($844) + g/t Ag( $15.60) + %Pb (20lb x $0.75) + %Zn (20lb x $0.90) / $844 has hectares m meters mm millimeters km kilometers NSR Net Smelter Return Pb lead RC reverse circulation drilling method t tonnes tpd tons per day Zn zinc 3.0 RELIANCE ON OTHER EXPERTS The author’s principal task was the development of a geologic model of the deposit and the calculation of a cross section based inferred resource. While he has reviewed and generally approved the April 2008 Technical Report by Besserer, he has not reviewed copies of agreements and other title documents for the properties making up the project, and can only assume them to be valid. Nearly all of the sections of this Technical Report not directly related to the resource estimation effort are excerpted directly from Besserer’s report or modified slightly for clarity, except where changes have occurred. Changes have been noted in the text in each section. Please see Mr. Besserer’s report for his “Reliance on Other Experts section” regarding the portions take directly from his report. The author has not investigated any environmental or social issues, which could conceivably affect the Cieneguita project. He does not consider himself to be qualified to assess these issues in Mexico.
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