The continuing engineering study (Updated Preliminary Economic
Assessment ("UPEA")) on the Valdecañas Vein, which is anticipated in Q1,
2012, is part of the approved budget.
At the same time, on MAG's 100 percent owned Cinco de Mayo property
drilling is to be focused on delineating the high grade silver/lead/zinc
mineralized system at Cinco Ridge/Jose Manto over a 4,000 metre strike
length. Companywide, MAG's board of directors have approved a 2012
exploration budget of $10.87 million.
This budget includes $3.80 million for MAG's 44% share of the Minera
Juanicipio board approved preliminary 2012 budget (100%) of US$8.5
million, an increase of US$4 million over the 2011
budget. In addition, MAG will spend an additional $840,000 for its
own direct project oversight and parallel studies, resulting in a total
MAG 2012 budget for Juanicipio of $4.64 million.
2012 Program:
In late December 2011, through the Minera Juanicipio board of
directors, Fresnillo and MAG jointly approved a 36,000 metre drill program
(see diagram at: http://media3.marketwire.com/docs/MAG120_F1.pdf)
which will see 10,000 metres earmarked for the Valdecañas Vein; an
additional 6,500 metres targeted for the newly discovered vein and
structure at Las Venadas; 4,000 metres to be drilled to the West at the
Juanicipio Vein; and, the remaining 15,500 metres heavily weighted to
exploration in the search for new vein discoveries.
The "stand alone" UPEA being carried out by AMC Mining Consultants
(Canada) Ltd. ("AMC") is anticipated in the first quarter of 2012. This
high level economic assessment will provide an important catalyst for MAG
and open a pathway for the next step in the development of the Valdecañas
Vein. It is anticipated that the 2012 budget will be reviewed and amended
to reflect the recommendations in the final AMC UPEA once completed.
MAG's 2012 budget for Cinco de Mayo (including Pozo Seco and Jose
Manto) has been approved at $3.45 million, with 15,000
metres of drilling targeted at delineating the mineralized corridor
between Jose Manto and Cinco Ridge.
Cinco de Mayo update (including recent assay results):
The 2012 program will consist of delineation drilling and offsets of
the new high grade silver / lead / zinc intercepts discovered in 2011 to
determine the width and continuity of mineralization in the zone and to
pin point where mineralization in the manto is thickest. Drilling is due
to start shortly with three drill rigs dedicated to the Jose Manto and its
extensions.
The results of the final two holes from last year were received and the
best intercept was 4.19 metres grading 183 grams per tonne ("g/t")
silver (5.9 ounces per tonne ("opt")), 6.80% zinc and 12.3% lead in Hole
CM11-383.
Table 1: New assay results for Cinco de Mayo, Jose
Manto Extension. |
Hole Number |
From Metres |
To Metres |
Width Metres |
Gold g/t |
Silver g/t |
Silver opt |
Zinc % |
Lead % |
CM11-383 |
316.03 |
320.75 |
4.19 |
0.060 |
183 |
5.9 |
6.80 |
12.30 |
and |
475.44 |
477.91 |
2.47 |
0.010 |
128 |
4.1 |
5.10 |
3.26 |
and |
490.37 |
491.50 |
1.13 |
0.180 |
367 |
11.8 |
15.10 |
17.00 |
CM11-384 |
270.10 |
272.33 |
2.23 |
0.100 |
12 |
0.4 |
0.49 |
1.72 |
The overall pattern of intercepts indicates a continuous linear manto
body at least 4,000 metres long.
Other Projects: Towards the end of the 2011, MAG
initiated drill programs at three highly prospective properties:
La Esperanza, Mojina and Lagartos Sur (El
Orito). These programs were not completed before the
Christmas break and will therefore be completed and results released in
early 2012.
2012 Objectives: Our ongoing strategy for 2012 is
fourfold: 1) Work with Fresnillo to move the Juanicipio Joint
Venture forward through continued exploration and the discovery /
delineation of new veins and to move the Valdecañas Vein towards
production with the delivery of an updated preliminary assessment; 2)
Cinco de Mayo will see a concerted drilling effort to
expand and delineate the high grade silver/zinc/lead massive sulphide
intercepts at the Bridge Zone and the Cinco Ridge to Jose Manto
Corridor. This work will go towards a first resource estimate and the
initiation of a PEA for this particular asset; 3) Continued aggressive
exploration on our 100% owned properties in search of new
discoveries or to delineate new resources; and 4) Identifying and acting
on merger and acquisition opportunities.
The above discussion is a summary of, and an update to, disclosure in
documentation filed with regulatory agencies and available for viewing
under MAG's profile on the SEDAR website at www.sedar.com and on SEC's EDGAR website
at www.sec.gov.
Qualified Person: Dr. Peter Megaw, Ph.D., C.P.G., has
acted as the qualified person as defined in National Instrument 43-101 for
this disclosure and supervised the preparation of the remaining technical
information in this release. Dr. Megaw has a Ph.D. in geology and more
than 20 years of relevant experience focused on silver and gold
mineralization, and exploration and drilling in Mexico. He is a certified
Professional Geologist (CPG 10227) by the American Institute of
Professional Geologists and an Arizona registered geologist (ARG 21613).
Dr. Megaw is not independent as he is a Director and Shareholder of MAG
and is the vendor of this project, which is subject to a NSR. Dr. Megaw is
satisfied that the results are verified based on an inspection of the
core, a review of the sampling procedures, the credentials of the
professionals completing the work and the visual nature of the silver and
base metal sulphides within a district where he is familiar with the style
and continuity of mineralization.
Quality Assurance and Control: The Company has in
place a quality control program to ensure best practices in sampling and
analysis. Samples were collected by employees of consulting firm Minera
Cascabel S.A. de C.V. on behalf of MAG Silver Corp. The diamond drill core
samples are shipped directly in security sealed bags to ALS-Chemex
Laboratories preparation facilities in Hermosillo, Sonora or Chihuahua
City (Certification ISO 9001). Sample pulps are shipped from there to
ALS-Chemex Laboratories in North Vancouver, Canada for analysis. All
samples were assayed for gold by standard fire assay-ICP finish with a 50
gram charge. Gold values in excess of 3.00 g/t were re-analyzed by fire
assay with gravimetric finish for greater accuracy. Silver, zinc, copper
and lead values in excess of 100 ppm, 1%, 1% and 1% respectively are also
repeated by fire assay.
About MAG Silver Corp. (www.magsilver.com)
MAG is focused on district scale projects located within the Mexican
Silver Belt. Our mission is to become one of the premier companies in the
silver mining industry. MAG and Fresnillo plc are jointly developing the
Valdecañas Deposit on the Juanicipio Joint Venture in Zacatecas State. The
total contained metals at the Juanicipio property on a 100% project basis
in the Indicated Resource are 146 million ounces of silver, 384,000 ounces
of gold and 267 million pounds of lead and 539 million pounds of zinc. The
Inferred Resources contain an additional 85 million ounces of silver,
370,000 ounces of gold and 236 million pounds of lead and 400 million
pounds of zinc. MAG has also identified a silver, lead and zinc discovery
at its 100% owned Cinco de Mayo property as well as a moly-gold discovery
on the same property. MAG is based in Vancouver, British Columbia, Canada.
MAG's common shares trade on the TSX under the symbol MAG and on the
NYSE-A under the symbol MVG.
On behalf of the Board of MAG SILVER CORP.
Dan MacInnis, President and CEO
This release includes certain statements that may be deemed
to be "forward-looking statements" within the meaning of the US Private
Securities Litigation Reform Act of 1995. All statements in this release,
other than statements of historical facts are
forward-looking statements including statements, including statements that
address future mineral production, reserve potential,
exploration drilling, exploitation activities and events
or developments. Forward-looking statements are often,
but not always, identified by the use of words such as
"seek", "anticipate", "plan", "continue", "estimate", "expect", "may",
"will", "project", "predict", "potential", "targeting", "intend", "could",
"might", "should", "believe" and similar expressions. These statements
involve known and unknown risks, uncertainties and other factors that may
cause actual results or events to differ materially from
those anticipated in such forward-looking statements.
Although MAG believes the expectations
expressed in such forward-looking statements are based on
reasonable assumptions, such statements are not guarantees of future
performance and actual results or developments may
differ materially from those in the forward-looking statements.
Factors that could cause actual results to differ materially
from those in forward-looking statements include, but
are not limited to, changes in
commodities prices, changes in mineral
production performance, exploitation and exploration successes,
continued availability of capital and financing, and
general economic, market or business conditions, political risk, currency
risk and capital cost inflation. In addition,
forward-looking statements are subject to various risks, including that
data is incomplete and considerable additional work will be required to
complete further evaluation, including but not limited to drilling,
engineering and socio-economic studies and investment. The reader is
referred to the Company's filings with the SEC and Canadian securities
regulators for disclosure regarding these and other risk factors. There is
no certainty that any forward-looking statement will come to pass and
investors should not place undue reliance upon forward-looking statements.
Cautionary Note to Investors Concerning Estimates of Indicated
Resources
This press release uses the term "Indicated Resources". MAG advises
investors that although this term is recognized and required by Canadian
regulations (under National Instrument 43-101-Standards of Disclosure for
Mineral Projects), the U.S. Securities and Exchange Commission does not
recognize this term. Investors are cautioned not to assume that any part
or all of mineral deposits in this category will ever be converted into
reserves.
Cautionary Note to Investors Concerning Estimates of Inferred
Resources
This press release uses the term "Inferred Resources". MAG advises
investors that although this term is recognized and required by Canadian
regulations (under National Instrument 43-101-Standards of Disclosure for
Mineral Projects), the U.S. Securities and Exchange Commission does not
recognize this term. Investors are cautioned not to assume that any part
or all of the mineral deposits in this category will ever be converted
into reserves. In addition, "Inferred Resources" have a great amount of
uncertainty as to their existence, and economic and legal feasibility. It
cannot be assumed that all or any part of an Inferred Mineral Resource
will ever be upgraded to a higher category. Under Canadian rules,
estimates of Inferred Mineral Resources may not form the basis of
feasibility or pre-feasibility studies, or economic studies except for
Preliminary Assessment as defined under Canadian National Instrument
43-101. Investors are cautioned not to assume that part or all of an
Inferred Resource exists, or is economically or legally mineable.
Please Note: Investors are urged to consider closely the
disclosures in MAG's annual and quarterly reports and other
public filings, accessible through the Internet at www.sedar.com and www.sec.gov.
Neither the
Toronto Stock Exchange nor the American Stock Exchange has reviewed or
accepted responsibility for the accuracy or adequacy of this news release,
which has been prepared by management.