Re: RGX - Red Gum Resources
RGX has been mainly focused on its La Negra Project, Chile, and will now be turning more attention to its Peruvian activities.
74m shares on issue, cash at end of March was $3.6m
Exercise of La Negra Option
HIGHLIGHTS
• Most holes drilled to date have encountered significant thicknesses of visual mineralisation, within a well defined zone of the La Negra property
• Base and precious metal mineralization of potential economic interest now demonstrated over at least 400 metres in a north-south direction; open to the south and downdip
• Geochemical results expected to be received continuously over the next three months as the laboratory catches up on its backlog
• Chargeability anomaly confirmed as a good first-pass guide to locating sulphide mineralization
• Exercise of Option requires final US$500,000 payment, which will now be made
• Rig to be demobilised early to await the full results of holes drilled to date, with a contingent option agreed upon to bring it backafter receiving the complete geochemical dataset
The La Negra property has a long history, dating back to colonial times, of sourcing high grade lead-zinc-silver material. Modern day geochemical sampling verified the surface and subsurface continuity of high metal grades
(zinc, lead, silver, copper, gold) over significant widths within the old workings
High Metal Grades Encountered in Maiden Drillhole at La Negra
• Maiden hole drilled RDN-001 confirms mineralisation in intervals assaying up to 10.45% Zinc and up 56g/t Silver,
• Extends zone of high metal grades from surface, to significant depth, where it is still open in all directions
High Metal Grades Continue in Second Drillhole at La Negra
• Second hole drilled confirms mineralisation intervals assaying up to 10.9% Zinc, 10.3% Lead and up 78.0 g/t Silver
• High metal grades intersected from surface remain open in all directions
Latest drilling expands La Negra polymetallic mineralization, with higher gold values reported
HIGHLIGHTS
• 36.0 metre intersection grading 1.63% Zinc, 1.47% Lead, 12.0g/t Silver and 0.49 g/t Gold reported close to surface in drill hole RDN-005
• This includes a gold-rich interval, reporting 11.0 metres at 1.68% Zinc, 1.74% Lead, 17.1 g/t Silver and 1.04 g/t Gold
• Base and precious metal mineralisation of potential economic interest now drill demonstrated over at least 300
metres in a north-south direction
• Mineralisation within the mineralized breccia unit remains open to the north, south and downdip
• Further drilling underway to focus along the trend connecting best-mineralised drill holes RDN-001, RDN-002
and RDN-005
Peru
- Peruvian surface exploration brought forward for the Cerro Huancash and Chongos projects. Local technical staff contracted and 3D digital compilation of all existing exploration data is well underway.
As disclosed in the Independent Expert's Report included within the Company's IPO Prospectus issued in November 2011, historical surface geochemical sampling by Pasminco reported up to 15.8% Zinc, 9.8% Lead and 459 ppm Silver to the west of the central side of the Cerro Huancash claim. Only four samples were taken towards the southern end of and within the claim area and reported up to 2,779 ppm Zinc, 1,957 ppm Lead and 11 ppm Silver. Teck Cominco in 2001 reportedly drilled at least four diamond drill holes along the trend to the north of the concession, intersecting intervals of high grade Zinc- Lead-Copper-Silver sulphides hosted within skarn–altered limestones.
More recently, Pan American Silver has reportedly conducted drilling of the mineralised trend immediately to the north of the Cerro Huancash claim. Red Gum is also aware that Pan American Silver recently completed a transaction with a private company, Southern Peaks Mining, involving the ‘Ariana’ tenements, which are adjacent to Cerro Huancash. The Company believes that this transaction has positive implications for the prospectivity of the area exclusively controlled by Red Gum.