Highlights:

• Resource drill-out program successfully completed
• JORC Mineral Resource estimate commenced and due in March
• Diamond drilling for advanced metallurgical testwork underway
• Potential for mineralised extensions of Mesa de Plata identified with drilling of high priority gold and silver targets to commence shortly

Azure Minerals Limited (ASX: AZS) (“Azure” or “the Company”) advises that it has completed the Reverse Circulation (RC) resource drill-out program of the Mesa de Plata silver mineralised zone at the Alacrán Project, located in the northern Mexican state of Sonora.

Completion of the drill program has enabled the calculation of a JORC-compliant Mineral Resource estimate to commence, which the Company anticipates will be completed by March.

In addition, on-going exploration continues to confirm the presence of significant gold and silver targets and follow-up drilling is expected to commence shortly.

Azure’s Managing Director, Mr Tony Rovira said, “Our exploration is continuing and studies by our geologists and external consultants indicate that the alteration and mineralisation styles at Mesa de Plata and in nearby areas are typical of other lithocap-hosted, epithermal gold and silver deposits in Mexico and elsewhere in Latin America. This supports the Company’s belief that a large mineralising system is present here with potential to host significant precious metal deposits.”

MESA DE PLATA – RESOURCE DRILL-OUT DETAILS

Silver mineralisation at Mesa de Plata is hosted in silicified volcanic rocks and residual quartz (vuggy silica) which outcrop extensively along the ridge. Drilling has confirmed that mineralisation starts at surface with true thicknesses up to 60m and extends throughout the Mesa de Plata ridge, and that internal continuity of mineralisation is excellent.

The central zone of high grade silver mineralisation, which averages greater than 200g/t Ag over a vertical thickness of approximately 20m, extends over an area of approximately 400m x 150m. This is surrounded by, and underlain by, a larger zone of moderate grade silver mineralisation (averaging 40-80g/t Ag) up to 60m thick, extending over an area of about 1,000m x 150-200m. The overall mineralised body dips shallowly to the northeast, and is confined to the southwest (up-dip) and northeast (down-dip) by erosional contacts forming valleys.

The Mesa de Plata resource drill-out consisted of three stages of drilling (two RC and one diamond core) undertaken between August 2015 and January 2016. The overall drilling campaign comprised 61 RC and five diamond core holes (Figure 1) for a total of 6,350.7m.

Drill hole spacing was on a 50m x 50m pattern covering a northwest-southeast extent of 1,000m and a width of up to 200m. All RC holes were drilled vertically to depths of about 90m and samples were collected over 1.5m intervals. Diamond holes were also vertical and were drilled to depths of between 75m and 205m. Refer to Tables 1 & 2 in Appendix 2 in this report for Stage 3 drill hole details and to ASX releases dated 16 September and 13 November 2015 for details on Stages 1 and 2. 

Assay results from holes MDPC-001 to 036 were previously reported (ASX: 23 December 2015). Samples from holes MDPC-037 to 057 have been submitted to the laboratory and assay results are expected to be delivered by early February.

As results have been received, they have been despatched to the Company’s consulting resource geologists in Canada and a JORC-compliant Mineral Resource estimate is in progress. It is expected that the resource estimate will be completed by March 2016. 

METALLURGY

A diamond rig has been mobilised to Mesa de Plata to conduct large diameter core drilling to collect bulk samples for an advanced metallurgical testwork program. It is expected that this drilling campaign will take about one to two months to complete and the metallurgical program may take three to four months.

FURTHER POTENTIAL

Significantly, Azure has identified excellent potential for additional gold and silver mineralisation in several locations outside of the drilled area at Mesa de Plata:

• to the east on the neighbouring ridge of Loma Bonita;
• further to the north along the trend of the Mesa de Plata ridgeline; and
• to the southeast of Mesa de Plata towards and around the Puerto del Oro prospect.

Extensive sampling in these areas has returned significant gold and silver grades in zones of residual quartz (both vuggy and strongly silicified) similar to that which hosts the silver mineralisation at Mesa de Plata. Results from recent exploration in these nearby areas, and details on exploration to follow-up these results, will be released shortly.

Loma Bonita has extensive gold and silver mineralisation at surface (ASX: 16 & 21 October 2015). Specifically, of 58 rock chip samples collected along the 400m ridgeline, 35 (60%) contain an average grade of 0.53g/t Au & 42g/t Ag. These results are considered highly significant, with the strongly elevated gold grades indicating that Loma Bonita is a high priority gold target.

Access for drilling at Loma Bonita and other nearby areas is currently being prepared and drilling will commence as soon as permitting is received (expected in early February).

-ENDS-

For further information, please contact: