Categories: Precious Metals
Topics: General Precious Metals

Animas Resources - Eric Pratt Article, ResourceX

By Eric Pratt

http://www.ResourcexInvestor.com

Thursday, April 2nd, 2009

Despite the fact that the financial and credit markets began to fall off a cliff about the same time Animas Resources came out of the gate, the company remains optimistic for 2009, and looks forward to expanding their understanding of the district-scale Santa Teresa project through the undertaking of another drill program focused on making the larger discoveries. The company technical staff has made significant strides in identifying the much larger sources that might have fed the previously mined 20 plus smaller Carlin style pits spread out over a gold in rock mineralized area of 18km by 6km.

Company President Greg McKelvey issued a press release in early March to convey an interpretation of what exactly the 2008 exploration program did accomplish for Animas.

“With the completion of Animas Resources’ initial drilling program in the Santa Teresa district late in 2008, I felt it was important to summarize what we accomplished and where this will lead us in the future,” he said.

The 2008 drilling program was designed primarily to test off-sets of mineralized areas within the known gold deposits, one deep test of the Mirador hornfels-IP/R anomaly, and two holes in gravel covered areas in the western part of the district at the Gravas target. 

While all of the holes added substantially to the understanding of the geology and mineralization controls in the district several of the holes, as outlined below, encountered encouraging gold anomalies.  All of these data are being incorporated into the database and interpretations are in progress to identify additional targets.

The hole at Camello (ARCM-001) is an example of how a seemingly insignificant interval of gold can identify an important target (12/1/08 PR).  ARCM-001 encountered 3.5 meters that averages 0.550 gpt Au at the bottom of the hole (226.60 m).  Mineralization is contained with carbonaceous-pyritic siltstone with an associated arsenic and zinc anomaly.  The hole is also at the margin of a large IP/R anomaly. 

The implication is that the hole encountered the southwest margin of a much larger mineralized area that will require additional drilling to evaluate. One historic hole drilled deep enough in the southwest area on the margin of this anomaly also encountered 19.5 meters of 1.45 gpt Au and ended in mineralization.

There are three smaller past producing pits on the margins of the anomaly and the Ruben pit that produced 6,418 ounces from rock that had an average grade of 3.85 gpt Au with an in ground 13,497 historic gold resource grading 2.06 gpt Au.

Among the key findings of exploration to date is the establishment of a rather large gold target.

According to the press release:

“The extensive geochemistry from the property outlines an area of anomalous gold that is at least 18 km long in a northwest-southeast direction and about 6km wide.  The width of the geochemical anomalies may be wider since there is post-mineralization gravel cover (alluvium) to the southwest and northeast. 

Arsenic concentrations (>100ppm) are commonly associated with the gold anomalies, but with wider distribution. There are several zones with associated anomalous, although more erratic, antimony, mercury, lead, and zinc.  This is a geochemical distribution pattern that is also evident in drill holes. 

The wider distribution of pathfinder trace elements enhances the targeting.  A zone of anomalous arsenic, with associated trace elements, in favorable lithologic units and structural ground preparation may suggest that areas of gold concentration are near.  Many of these anomalies have not been drilled, or are insufficiently tested by drilling.”

Jeff Phillips, a major Animas shareholder and member of the advisory board to the company sums it up like this:

“.The external financial events of the past 12 months have been difficult and changed the nature of the word risk. I believe gold will surprise many in the coming year due to its continued strength and more rights offerings will continue to be completed by the majors and mid-tiers.

These companies are not replacing the ounces they have mined and there has been relatively little discovery in the past cycle. They need properties/districts that offer these large potential discoveries.

The company currently has a market cap of 8 million dollars and only 27 million shares outstanding and I don’t believe this accurately reflects the value of reconsolidating the entire Santa Teresa district (200 sq miles), the 700,000 historic resources that is not NI 43-101 compliant, and most of all the following work completed to date:

  • Approximately 90 percent of all historical work has been recaptured and is being used
  • 125± line km of 100m, pole-dipole IP surveying completed
  • Reinterpretation/remodeling of historic “deep searching” 300m dipole IP (75± line km) and 5,400± line km of airborne magnetic, radiometric and EM  data
  • Geological/alteration mapping completed over 75± percent of the main producing district and producing toward the south and east.
  • Processed Aster satellite imagery to assist in surface alteration mapping
  • Collected 1,500± surface rock-chip samples (analyzed for Au and multiple trace elements)
  • Processing of the multi element geochemistry is progressing and showing clear zoning and trends complimentary to mapping and geophysical targeting
  • RIP (Reconnaissance Induced Polarization) surveying completed over 50± percent of main producing district
  • 25 holes drilled to test down-dip and strike extensions of known surface mineralization and deeper conceptual exploration targets (5,691± m). These holes were completed over a very large are and not focused solely on one target.
  • Computer scanning of old reports and the construction of a computer searchable database
  • Construction and using of a “state of the art” GIS database system
  • Numerous untested gold (>0.1 ppm in soil and >1.0 ppm in rock) and trace element anomalies within an area of approximately 160 km² (20km. by 8 km.)
  • At least three large (3+ km²), identified zones of hydrothermal alteration which represent potential centers of deeper, high-grade gold mineralization
  • Mineral zoning form drilling and surface rock geochemistry demonstrate larger systems and are complimentary to the surface mapping of alteration shown to be directly associated with gold mineralization
  • Drilling demonstrates the existence of larger ore grade intercepts, the fact of higher grades and the demonstration of large scale project areas
  • Modern geologic modeling and current gold prices are favorable for new resource estimates. Drilling is not necessary for larger estimates.
  • Drilling has assisted in both limiting and extending some known mineralization.
  • Known alteration zones are coincident with strongly anomalous IP and Magnetic responses

Animas Resources previous drill hole gold and multi element assay results have taken far too long to get out and the company have corrected this for future drilling. While drilling did provide some extensions to the known smaller deposits it did not provide the amount the market expected (the markets expectations have also changed).

The drilling was done over a wider area to have a look at the geology in and controls for gold mineralization. The Gold footprint (past mining operations and soil samples) is quiet large approximately 18 km by 6km. Animas Resources technical team has long suspected there where bigger mineral events happening at SG but there were some in the professional community that did not hold this view. The team believed it might take time to find these areas and did on the first drilling pass at both the Amelia and Mirador areas.

They did not expect it to happen this early in the program. The focus of the field effort is to find the larger deposits and is where the real value lies in the company.”

Animas has CA$3.5 million cash in the bank, which is enough to execute its plans for 2009 and early 2010, and is in the process of finalizing plans for this year’s drilling. There will soon be a National Instrument 43-101 issued, and the company expects to drill between 7,000 and 10,000 metres.

Animas has had several majors visit the Santa Teresa project and more visits are planned this year. The company has 27.4 million shares outstanding. Visit Animas Resources online at http://www.AnimasResources.com