VANCOUVER – Capitan Mining Inc. [CAPT-TSXV] shares rallied sharply Wednesday in active trading after the company reported drilling results from the Jesus Maria polymetallic silver deposit at the Penoles project, Durango Mexico.
Highlights from a 2021/2022 Phase 1 drill program include Hole 21-JMRC-01, which returned 42.7 metres of 224.3 g/t silver equivalent (AgEq), starting at a depth of 18.3 metres. This intercept includes five separate high grade intervals, including 1,35.3 g/t AgEq over 1.52 metres (1,271 gT Ag, 0.53 g/t gold, 0.49% led and 0.65% zinc).
Hole 21-JMRC-04 returned 7.6 metres of 122.8 g/t AgEq, including 368.1 g/t AgEq over 1.52 metres.
The company said all three holes intersected additional mineralized structures that had not previously been identified.
Capitan shares advanced on the news, jumping 34.8% or $0.075 to 29 cents on volume of 747,290. The shares are currently trading in a 52-week range of 42 cents and 18 cents.
The Penoles Project, includes an oxide gold prospect (referred to as El Capitan) and two historic silver mines (Jesus Maria and San Rafael). Wide intervals of near-surface gold mineralization (with low silver values) have been defined at El Capitan that could potentially be amenable to open-pit extraction methods. El Capitan hosts an inferred resource of 20.7 million tonnes, grading 0.458 g/t gold and 2.8 g/t silver, or 305,000 ounces of gold and 1.83 million ounces of silver.
The Jesus Maria (JM) silver deposit is located approximately 280 metres to the northeast of the Capitan deposit. JM has been traced by surface trenching and diamond drilling over a strike length of 750 metres and to a depth of 150 metres, with the majority of drilling focused over a 250-metre strike length and less than 100 metres below surface.
The company said the JM deposit has a long mining history dating back to the late 1800s, when the Penoles Mining company constructed several shafts and drifts to exploit the high-grade silver veins in the area. Work to date has identified two distinct styles of silver mineralization, including high-grade silver polymetallic veins, and high-grade silver with gold veins.
Approximately 3,100 metres of diamond drilling were completed by previous operators at the JM deposit between 2011 and 2014. Results were used to complete an initial 43-101-compliant inferred resource in 2015 consisting of 7.5 million tonnes at 62 g/t Ag (15 million ounces) and 0.1 g/t gold (26,000 ounces).
“The first three holes reported form the Jesus Maria silver deposit, together with the recently reported hole 21-CARC-29 under the Capitan Hill Oxide gold deposit, demonstrate the significant growth potential from silver mineralization at the Penoles Project,’’ said Capitan CEO Alberto Orozco.
“I am particularly excited or the results of hole 21-JMRC-01, which confirm the continuity of high-grade mineralization from surface trenching,’’ he said. “This high-grade zone has only been drill tested to shallow depths, and remains open to expansion, down plunge.’’
Capitan is led by a management team that has successfully advanced and developed several heap leach operations in Mexico over the past 16 years.