Shares in CMC Metals (TSX-V:CBM) continued their recent form yesterday, climbing around 12% after the company reported that indicative XRF assays from surface trench samples at the ‘TM’ pit, within the 100% owned Silver Hart Mine, had indentified very high grade silver-zinc mineralization (click here to view trench results).
CMC Metals is conducting the trenching ahead of a proposed mine start at the historic project which is located in Yukon, Canada. CMC Metals is planning a modular operation that will support a 20,000 tonne per year mine and an 80 tonne per day mill facility to concentrate the run-of-mine ore.
Previous exploration in the pit had missed the high grade nature of the ore due to the fine clay texture.
“Based on the preliminary assays it was determined that the historical data missed the occurrence of the enrichment zone in the footwall where the andesite dike exists,” CMC Metals noted. “Based on the fine clay texture of the occurrence, the drill data would not be able to recover the intersection and would understate the current resource estimate for the TM zone.”
The update was received well by investors, especially those who recently participated in a C$400,000 placing at 10 cents per share with a full warrant exercisable at 15 cents a share. Shares in CMC Metals have risen approximately 46% in the past three months and are currently trading at 19 cents.
Donald Wedman President and CEO of CMC Metals said: "To identify these additional bonanza grades within the TM pit provides an exceptional opportunity to provide direct shipment ore at the early start-up stage of the pit development."
The surface sampling program will continue over the next two months.
A historic resource estimate (F. Smith, 1988) was determined at the end of 1987 for the TM zone. An estimate for proven and probable reserves of 72,345 tonnes with an average grade of 2,023 grams per tonne silver, totaling 4.7 million ounces of silver was calculated. Not included in the total was an inferred resource 1.8 million ounces of silver. Average base metal values include 4.97% lead and 8.59% zinc.
More recently, metallurgical test results confirmed the potential for high recoveries of silver (96.9%), lead (97%) and zinc (80%) by flotation methods.