Cinco de Mayo

CINCO DE MAYO PROPERTY
MUNICIPIO VILLA AHUMADA CHIHUAHUA, MEXICO

Cinco de Mayo is a 5,000 hectare Carbonate Replacement Deposit ("CRD") prospect located in north-central Chihuahua.

Project Details

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MAG Silver's 2006 drill program at Cinco de Mayo in northern Chihuahua, has once again moved another project from a conceptual model to discovery. New lead, zinc and silver mineralization was drilled on the floor of a broad valley covered by recent soils (alluvial). All of the targets drilled were buried (blind) geophysical and geochemical anomalies that were consistent with our exploration model.

Cinco de Mayo is one of MAG's four Carbonate Replacement Deposit (CRD) Style properties and the discovery here has important implications for the exploration of all four of these projects. Carbonate Replacement Deposits CRD's have contributed 40% of Mexico's historic silver production, making them second only to epithermal veins. CRDs form a spectrum ranging from stock contact skarns, through dike and sill contact skarns and massive sulfides, to massive sulfide chimneys and mantos, with large systems ranging from 25 to 100 million tonnes of high-grade ores. Mexico's CRDs occur along the intersection of the Laramide-aged Mexican Thrust Belt and the Tertiary volcanic plateau of the Sierra Madre Occidental, a zone where structurally prepared carbonate host rocks were invaded by metals-rich intrusive bodies.

At Cinco de Mayo the regional story is very strong: the project lies on the western bounding fault of the Chihuahua Trough, the same structure that hosts major CRDs like Santa Eulalia (MAG's Guigui property), Naica, San Pedro Corralitos and Terrazas. This gives rise to a thick carbonate section to host mineralization and a major regional zone of weakness for both ground preparation and intrusive emplacement.

This ancient crustal break first controlled deposition of a thick section of carbonate host rocks, later movements created abundant structural fluid pathways, and finally it guided metals-rich magmas into place for optimal mineral deposition.

At Cinco de Mayo there are numerous mineralization and alteration occurrences associated with this fault. These include old mines on the Cinco Chimney and Cinco Manto at opposite ends of the Cinco de Mayo ridge, Abundancia, Celia and Orientales, all of which lie within MAG's property package. Further, Cinco de Mayo Ridge is cut by numerous ferruginous jasperoid veins that carry strongly anomalous lead-zinc-copper-silver and gold values. Despite the extensive cover, the nature and degree of mineralization and alteration in Cinco de Mayo Ridge strongly indicated that a significant CRD system may lay hidden nearby under the cover.

Program Results 2006

To aid in the ability to "see" through the alluvial cover, MAG conducted 45.1 line kilometres of NSAMT surveys on lines running northwest parallel to the Cinco de Mayo ridge and northeast across the ridge and parallel to the outcropping jasperoid vein swarms. In general the NSAMT data show a great deal of texture that is consistent with the regional understanding and with the details of our exploration model. The data show a profound northwest-southeast linearity and strong electrical contrasts along the northeast-southwest lines.

MAG has also completed a major biogeochemical sampling program. Copper and zinc show the best definition, revealing a strong anomaly to the northeast of the Cinco Manto mineralization located on the nearby ridge. The linear patterns in the anomalies line up with the jasperoid vein swarms. The strongest anomalies occur off the northeast flank of the ridge, where most of the historic prospecting has taken place. There are also a series of anomalies on the SW side of the ridge that correspond closely with jasperoid veinlet swarms.

Combining the geological, geochemical, biogeochemical, geophysical data and interpretations MAG developed a series of drill targets along a very prominent NW trending fault zone that cuts strongly folded massive limestone and limestone-rich sedimentary rocks. Nine holes totaling 3,975 metres were drilled in an area roughly 1.5 kilometre wide and over 2 kilometre long with significant structurally controlled replacement style massive to semi-massive sulphide mineralization occurring in six of the holes. At least trace mineralization was encountered in the remaining three holes. The intersections occur within broad zones of dispersed lead, zinc and iron sulphides developed in the surrounding sedimentary rocks. For example, the intercept in Hole 07 occurs within a 65 metre wide zone of stringer and dispersed lead and zinc sulphides.

Hole 09 lies at the northernmost end of the 2 kilometre long drilling pattern and was drilled on a geophysical anomaly detected in the initial processing of a 450 line kilometer airborne electromagnetic and magnetic survey flown during the drilling program. Hole 09 intersected over 68 metres of strong hornfels (alteration developed near an igneous heat source) with widespread associated dispersed and veinlet zinc and lead sulphide mineralization. Subsequent final processing of the geophysical data show that the Hole 09 structure can be traced for kilometres in either direction and reveals several similar features that are obvious targets for Phase Two drilling. Significantly, intersecting hornfels in the Hole 09 airborne survey anomaly, suggests that buried mineralization-related igneous heat sources can be detected geophysically, which will be a valuable ingredient in focusing ongoing exploration programs at all MAG's CRD properties.

MAG contracted a 450 line kilometre airborne magnetic and electromagnetic survey which was completed in late 2006. The results are considered very significant and will guide further drilling later this year when integrated with previous work and the recent drill information.

Early systematic regional exploration work and the results of this first phase drill program clearly show that Cinco de Mayo has many geological and mineralogical characteristics in common with the largest CRDs in Mexico. Management contends that successfully locating completely blind mineralization in initial drilling confirms that we are applying the right techniques in the right geological setting and that a mineralized carbonate replacement system of significant strength and size may be present.

Related News Releases:

May 14, 2008	MAG Silver Continues to Intersect Silver/Lead/Zinc Over Wide Area at Cinco de Mayo
February 07, 2008	MAG Silver intersects high grade silver, lead, zinc at Cinco de Mayo
August 23, 2007	MAG Silver Starts Drill Program at Cinco De Mayo