Highlights:

• Drilling significantly extends gold mineralised zone at Loma Bonita, now with lateral extent of 400m x 150m while remaining open in all directions
• Best drill hole intercepts from Loma Bonita include:
  • MDPC-089: 49.5m @ 1.59g/t Au & 29g/t Ag from 54.0m; including
    • 34.5m @ 2.03g/t Au & 34g/t Ag from 54.0m
  • MDPC-090: 111.0m @ 0.81g/t Au & 18g/t Ag from surface; including
    • 30.0m @ 1.56g/t Au & 15g/t Ag from 34.5m
• MDPD-020: 14.0m @ 1.59g/t Au & 36g/t Ag from surface; including
  • 8.1m @ 2.45g/t Au & 39g/t Ag from 4.0m
• Gold mineralisation commences at or near surface and is hosted in the metallurgically favourable oxide zone
• Exploration drilling now completed at Mesa de Plata Norte and is continuing at Loma Bonita, Cerro San Simon and Cerro Enmedio
• Drilling continuing at Mesa de Plata as part of development studies

Azure Minerals Limited (ASX: AZS) (“Azure” or “the Company”) is pleased to advise that ongoing diamond and Reverse Circulation (RC) drilling at its flagship Alacrán Project has delivered more significant intercepts of gold mineralisation at the Loma Bonita prospect.

Azure’s Managing Director, Tony Rovira said: “These latest drilling results are very positive and supportive of our belief that Loma Bonita could become a substantial gold deposit, particularly as the grades and thicknesses of the gold zone appear to increase significantly to the south.

“Together with the ongoing development studies at Mesa de Plata, Loma Bonita is a very high priority for Azure and we’ll continue to keep the drills turning there. Meanwhile, our grass roots exploration program is continuing with a diamond rig now drilling further to the south of Loma Bonita at Cerro San Simon and Cerro Enmedio testing substantial geochemical and geophysical anomalies.”

DETAILS OF LOMA BONITA DRILLING

Following the discovery of significant widths of high grade gold mineralisation at Loma Bonita, drilling is now being undertaken on a 50m x 50m grid spacing to identify the lateral and depth extent of the mineralised zone and assess the internal continuity of the mineralisation. The early holes in the current program were collared on the crest of the Loma Bonita hill in the southern part of the prospect and the drill pattern extends to the north (see Figure 1).

As the core drilling was progressing slowly due to difficult ground conditions, the RC rig which was undertaking the infill drilling at Mesa de Plata was transferred to Loma Bonita to accelerate the exploration program. To date, six RC holes (MDPC-089 to 094 for 1,085m) and four core holes (MDPD-019 to 022 for 702m) have been completed. Drilling with the RC rig is continuing.

Large mineralised widths containing strong and consistent gold grades have been intersected in several holes in the southern part of Loma Bonita. In addition to the initial intersection in hole MDPD-012 which returned 48.0m @ 2.7g/t Au (ASX: 11 May 2016), significant gold intercepts have been made in MDPC-089 (49.5m @ 1.59g/t Au) and MDPC-090 ( 111.0m @ 0.81g/t Au) (see Cross Section in Figure 2). Both of these holes also contain good widths of higher grade gold mineralisation.

Significant gold mineralisation has now been identified over a length of 400m in a north-south direction and up to 150m east-west. No boundaries to the mineralised zone have been identified to date, with mineralisation remaining open in all directions.

Drill intercept lengths of gold mineralisation vary from 10m in the north to over 100m in the south. Most gold intercepts are situated either at or near to surface within the oxide zone, with previously reported metallurgical testwork demonstrating very high gold recoveries from cyanide leaching of this material (ASX: 14 July 2016).

 ¹ See attached JORC Table 1 for calculation and reporting of mineralised intervals

Figure 1: Drill hole location plan for Mesa de Plata and Loma Bonita

Figure 2: Cross section through Loma Bonita gold zone (see Figure 1 for location)

EXPLORATION DRILLING

Mesa de Plata Norte

Following completion of hole MDPD-022 at Loma Bonita, the diamond rig mobilised to Mesa de Plata Norte and six holes (MDPD-023, 024, 026, 027, 028 & 030) were drilled for a total of 300m. The first two holes drilled through a short (approximately 4-6m), near-surface interval of vuggy silica similar to that which occurs at Mesa de Plata before passing into an unaltered and barren andesite volcanic rock. The final four holes intersected only the barren andesite.

This indicates that the surface exposures of vuggy silica that contain high silver grades are the roots or remnants of an in-situ profile or are the result of a landslip that dropped large blocks downslope from the northern end of the Mesa de Plata ridge. Consequently, Azure believes there is limited potential for significant silver mineralisation at Mesa de Plata Norte.

Cerro San Simon and Cerro Enmedio

Precious and base metal targets have been identified at Cerro San Simon and Cerro Enmedio by surface geochemical sampling, geological mapping and the Induced Polarisation (IP) survey. Diamond drilling has commenced at these prospects with hole MDPD-025 completed at Cerro San Simon and MDPD-029 in progress at Cerro Enmedio.

MESA DE PLATA PROJECT DEVELOPMENT

Eight large diameter (PQ size: 85mm) core holes were drilled along the strike of the Mesa de Plata deposit to collect representative bulk samples for advanced metallurgical testwork, and more than five tonnes of mineralised material was dispatched to the Kappes Cassiday & Associates (KCA) laboratories in Reno, Nevada, USA. These samples will be subject to crushing, grinding and compaction tests, to be followed by tests to assess various heap leach and flotation processing options. In addition, the PQ core was orientated during drilling which allowed detailed geotechnical logging to be undertaken for geotechnical and mining studies.

Infill RC drilling to upgrade the Mesa de Plata High Grade Zone to Measured Resource status was paused in early August to allow the RC rig to move to Loma Bonita to accelerate the exploration drilling. The total resource upgrade drill program comprises 85 holes for approximately 4,000m and to date 29 holes (MDPC-060 to 088) for 1,353m have been completed. All assays have been received for these drill holes and the data is being incorporated into the Mineral Resource model. The remainder of the infill drilling will recommence following the completion of the exploration program at Loma Bonita.

BACKGROUND

The Loma Bonita Gold Prospect is located on the Company’s Alacrán Project, 10 kilometres to the southeast of Cananea in Sonora, Mexico and 200 metres to the east of the Azure’s Mesa de Plata Silver Deposit.

Azure acquired the rights to the Alacrán Project in December 2014 through its fully owned Mexican subsidiary Minera Piedra Azul S.A. de C.V.

Azure has signed an Agreement with Teck to acquire 100% of the property, subject to an underlying back-in right retained by Teck and a 2% NSR retained by Grupo Mexico. Teck Resources Limited is Canada’s largest diversified resource company. Grupo Mexico is Mexico’s largest and one of the world’s largest copper producers.

-ENDS-

Information in this report that relates to Exploration Results is based on information compiled by Mr Tony Rovira, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Rovira is a full-time employee and Managing Director of Azure Minerals Limited. Mr Rovira has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Rovira consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Information in this report that relates to previously reported Exploration Results has been crossedreferenced in this report to the date that it was reported to ASX. Azure Minerals Limited confirms that it is not aware of any new information or data that materially affects information included in the relevant market announcements.

Original Article: http://www.azureminerals.com.au/azs//assets/2016/08/1586387.pdf