Vancouver’s Heliostar Metals Ltd. (TSX-V: HSTR) (OTCQX: HSTXF) (FRA: RGG1) has reported high-grade intercepts from its newly acquired Ana Paula project in Guerrero, Mexico after drilling its first two holes on the property.
On Tuesday, Heliostar announced its new drill results from the project and now believes the site could potentially host a highly profitable underground gold mining opportunity.
Most notably, the company intercepted 8.3 grams per tonne of gold over 101.1 metres including 11 g/t Au over 53.2 metres in hole AP-23-292. The other drill hole’s results consisted of the following:
Hole AP-23-291: 5.4 g/t Au over 118.5 metres including 11 g/t over 44.5 metres with 48.5 g/t over 4 metres
Heliostar acquired the Ana Paula project from Argonaut Gold Inc. (TSX: AR) in March for US$30 million.
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Heliostar says the Ana Paula project has had over US$75 million in recent exploration and development expenditures and has an open-pit mining permit. However, these new results have indicated that re-scoping the asset and focusing on underground mining would be in Heliostar’s best interest.
The company is currently undertaking a re-scoping program involving underground mine design, geometallurgical optimization studies and a resource update that will be released later this year. Heliostar believes the program will yield a technically simpler and materially improved Net Present Value (NPV) at Ana Paula.
“We are thrilled with the first holes at Ana Paula. Drill results like this are rare anywhere in the world. Ana Paula’s high grade and consistently wide intervals of gold mineralization demonstrate the underground mine potential,” said Heliostar’s CEO Charles Funk.
The Ana Paula deposit contains measured and indicated resources of 1,468,800 ounces of gold and 3.6 million ounces of silver.
In addition to its activity at Ana Paula, Heliostar is currently working on obtaining permits from Mexican authorities for the San Antonio gold project in Baja Sur and continuing exploration of its Unga gold project in Alaska.
Other Canadian gold producers operating in Guererro include Vancouver’s Equinox Gold Corp. (TSX: EQX) (NYSE American: EQX), which owns and operates the state’s Los Filos Gold Mine and Toronto’s Torex Gold Resources Inc. (TSX: TXG) which is currently focused on exploring and developing the Morelos Gold Property in the Guererro Gold Belt.
Heliostar’s stock rose by 2.04 per cent Tuesday to $0.50 on the TSX Venture Exchange.