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GOLD: Argonaut confirms high grades below planned Magino pit



Magino deposit and exploration targets Credit: Argonaut Gold

Magino deposit and exploration targets Credit: Argonaut Gold

TORONTO – Argonaut Gold has released exploration results for its Magino gold exploration project in Ontario and provided an update on permitting the San Antonio project in Mexico.

At Magino, drilling targeting mineralization below and adjacent to the current open pit mineral resource returned a number of higher grade intercepts.

Drill highlights include:

  • Hole MA 19-012 returning 37 metres of 4.92 g/t gold from the Elbow zone;
  • Hole MA 19-009 returning 10 metres of 5.37 g/t gold from the Elbow zone;
  • Hole MA 19-008 returning 3 metres of 5.95 g/t gold from the South zone;
  • Hole MA 19-010 returning 2 metres of 7.82 g/t gold from the South zone.

The current work was primarily focused on two high grade structural zones, the Elbow zone and the South zone.

The Elbow zone has been traced over 500 metres of strike and remains open. Argonaut believes that the zone is an extension of the Lochalsh zone from the adjacent Island Gold mine (Alamos Gold). Drilling to date has intersected this zone down to 600 metres below surface.

Drilling completed on the South zone, a previously untested area, intersected two parallel gold bearing zones. The South zone is located 300 metres south of the Elbow zone and immediately south of the planned Magino pit; it remains open.

Follow up work is planned to test the structures below 800 metres depth and to extend the drilling towards the western edge of the property where Argonaut has identified a number of targets, including the Lovell Lake zone and the P-51 Mustang zone.

According to the company, these initial exploration results suggest potential for high grade underground mineralization below the planned Magino pit.

Measured and indicated resources at Magino stand at 144 million tonnes grading 0.91 g/t gold for a total of 4.2 million ounces. The project received federal and provincial environmental assessment approvals in the first quarter of 2019.

San Antonio setback

In addition, Argonaut announced that Mexico’s environmental authority issued a ruling to not approve the company’s updated environmental impact assessment for the San Antonio project in Baja California Sur. This appears to be due to non-compatible zoning based on a revised zoning plan filed in 2018 by the municipality.

Argonaut believes that the zoning issue was resolved through a July 2016 supreme court ruling.

In August 2012, the company was denied its EIA for the project due to a local zoning issue. It then filed a federal lawsuit stating that the local zoning plan was not validly constituted. The federal appeals court ruled in Argonaut’s favour, stating that that the municipality’s zoning plan was not properly established and should not have been used as a project review criterion.

Argonaut is reviewing its options, including filing an amendment to the 2018 zoning plan based on the 2016 court ruling, submitting an updated EIA, or other legal options.

Measured and indicated resources at San Antonio stand at 65.1 million tonnes grading 0.83 g/t gold for a total of 1.74 million ounces.

This year, the company expects to produce 190,000 oz. to 200,000 oz. of gold equivalent at all in sustaining costs of US$1,125 to US$1,150 per oz. from its two operating projects in Mexico. Next year, it expects to deliver similar production at lower operating costs.

For more information, visit www.ArgonautGold.com.