Pacific Bay Options Bulk Tonnage Gold Target in the Prolific Pataz Gold Belt, Peru
October 29 2012 - 9:00AM
Marketwired Canada
David H. Brett, President and CEO, Pacific Bay Minerals Ltd. (TSX VENTURE:PBM)
(the "Company" or "PBM") reports that the Company has signed a Letter of Intent
(the "LOI") with Salwell Minerals S.A.C. ("Salwell") to acquire up to an 80%
interest the Oro Pataz Gold Project located in the Pataz gold district,
approximately 500km north of Lima, Peru (the "Property"). Management believes
the Property has the potential to host both underground and bulk tonnage,
open-pittable gold deposits.
The Pataz gold district has historic production of over 6 million ounces of gold
with several currently operating mines in the region. The Property consists of
10 concessions comprising approximately 3,700 hectares located in the Trujillo
Department. Mineralized zones occur as mesothermal gold-bearing quartz veins and
stockworks within a propylitically altered and highly pyritized granodioritic
host rock.
Exploration on the land package over the last 10 years has been limited in part
due to fragmented land ownership which Salwell successfully consolidated in
2008. However, prior to 2002 a significant amount of exploration work was
carried out, including: ground geophysics, remote sensing, trenching and a
10-hole drilling program. Much of the historic data, including the drilling,
cannot be directly confirmed and is available in brief report.
However, two areas of surface gold mineralization separated by about 2 km were
verified more recently by Salwell. The El Tornito Zone, discovered in 2006 by
Salwell's geolgists, is 1,500m x 500m and has 19 rock chip samples that range
from 0.16-1.75 ppm (averaging about 0.75 ppm). The Valentina Zone discovered in
the late 1990s has been sampled over an area 500m x 500m with 10 rock chip
assays that range from 0.11 to 1.48 ppm (averaging 0.71 ppm). Salwell's
geologists have re-sampled some of these test pits and verified the presence of
gold mineralization at these levels.
This Valentina Zone was also the subject of the drill testing which has not yet
been verified, but which apparently encountered significant gold values under
the surface mineralization. Reported intercepts include 10.3 grams per tonne
gold over 15.2 metres, 8.78 gpt gold over 9.7 metres and 10.5 gpt gold over 12.8
metres. The intercepts are reported as core length only; true widths unknown.
The average down-hole depth of the structural zone is approximately 80 m. A full
table of the drilling results follows.
Broad zones of low grade mineralization at surface, combined with better
reported grades at depth, bolsters management's view that the Property has open
pit and high grade underground potential.
----------------------------------------------------------------------------
Hole
Length From To Length Grade
Drill Hole Angle Azimuth (m) (m) (m) (m) (gpt)
----------------------------------------------------------------------------
DDH-1 -90 Vertical 119.00 70.3 73.4 3.1 1.10
----------------------------------------------------------------------------
73.4 88.6 15.2 10.30
----------------------------------------------------------------------------
DDH-2 -50 West 112.50 60.8 62.1 1.3 10.56
----------------------------------------------------------------------------
69.1 78.8 9.7 0.20
----------------------------------------------------------------------------
DDH-3 -73 West 94.85 62.4 83.4 21.0 8.78
----------------------------------------------------------------------------
83.4 94.4 11.0 2.40
----------------------------------------------------------------------------
DDH-4 -51 East 83.00 69.3 74.0 4.7 11.50
----------------------------------------------------------------------------
78.3 80.8 2.5 1.20
----------------------------------------------------------------------------
80.8 83.0 2.2 0.20
----------------------------------------------------------------------------
DDH-5 -65 East 66.00 46.9 59.7 12.8 10.50
----------------------------------------------------------------------------
59.7 66.0 6.3 2.20
----------------------------------------------------------------------------
DDH-6 -81 East 125.00 56.5 63.9 7.4 1.00
----------------------------------------------------------------------------
83.9 89.3 5.4 11.20
----------------------------------------------------------------------------
DDH-7 -90 Vertical 130.00 117.1 119.2 2.1 1.60
----------------------------------------------------------------------------
119.2 127.0 7.8 9.83
----------------------------------------------------------------------------
DDH-8 -90 Vertical 96.00 81.9 86.3 4.4 0.30
----------------------------------------------------------------------------
86.3 91.7 5.4 8.98
----------------------------------------------------------------------------
DDH-9 -26 West 104.40 58.8 68.5 9.7 0.40
----------------------------------------------------------------------------
68.5 89.7 21.2 9.40
----------------------------------------------------------------------------
DDH-10 -50 East 114.00 75.2 77.0 1.8 0.90
----------------------------------------------------------------------------
87.9 93.9 6.0 3.10
----------------------------------------------------------------------------
103.7 106.4 2.7 9.89
----------------------------------------------------------------------------
110.7 113.2 2.5 0.50
----------------------------------------------------------------------------
(i)The above drill results are consistent with other gold deposits in the region
and believed by the Company to be reliable, but were obtained by previous
operators whose pre-NI 43-101 quality control and quality assurance procedures
cannot be verified by the Company. As such, these results need to be confirmed
and should not be relied upon by investors.
The LOI is subject to the approval of the TSX Venture Exchange and the
completion by the parties of a definitive option and joint venture agreement.
The terms of the LOI to earn a 60% interest in the Property include:
-- Pay Salwell $10,000 (all figures in USD$) within 10 days of signing the
LOI.
-- Pay Salwell $5,000 and 50,000 shares of PBM stock per month, or $10,000
per month, at PBM's election, for 10 years.
-- Incur a minimum of $250,000 in exploration expenditures of the Property
per year for 10 years, or an aggregate of $2.5 million over a shorter
period, at PBM's election.
To earn an additional 10% interest in the Property, PBM must:
-- Pay Salwell 1 million shares of PBM
-- Continue the minimum $250,000 per year in expenditures.
-- Fund and complete a feasibility study recommending commercial production
on the Property.
To earn a further 10% interest in the Property PBM must finance and place the
Property into commercial production.
"The acquisition of this high quality gold project represents a shift in
direction for Pacific Bay," said Pacific Bay CEO David H. Brett. "While we
maintain our excellent portfolio of uranium and base metal holdings, we look
forward to making Oro Pataz our flagship project over the near term."
The technical disclosures in this news release were reviewed and approved by
Doug Blanchflower, P.Geo., a Qualified Person, as defined by National Instrument
43-101.
Pacific Bay Minerals Ltd.
David H. Brett, MBA, President & CEO
FOR FURTHER INFORMATION PLEASE CONTACT:
Pacific Bay Minerals Ltd.
David H. Brett, MBA
President & CEO
604-682-2421
604-682-7576 (FAX)
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