Drilling Begins at Largo's Macuchi Gold Property in Ecuador
Wednesday May 2, 5:15 pm ET
Aur Resources Inc. begins 8 hole Phase I program
TORONTO, ONTARIO--(CCNMatthews - May 2, 2007) - Largo Resources Ltd. (TSX VENTURE:LGO - News) has been informed by Aur Resources Inc. (Aur) that it has begun drilling at the Macuchi Gold property. Aur has planned an 8-hole, 2000 metre minimum, drilling program. This drill program is focused on several high priority targets that were identified in previous work on the property. The program will consist of two (2) holes at Mercedes, one (1) hole at each of Esperanza and Patino and the remaining four (4) holes along the Minchoa trend.
Aur optioned the Macuchi gold property from Largo in October 2006. The earn-in agreement gives Aur the right to earn a 75% interest in the property by making cash payments to Largo totalling US$1.025 million and expenditures on the property totalling US$3.5 million dollars over a five year period.
Largo's Macuchi property covers over 5,000 hectares in northeastern Ecuador, hosting a number of significant polymetallic (Au, Cu, Zn & Ag) volcanogenic massive sulphide (VMS) zones, including the past producing Mercedes mine (production 1940-1946 - 435,000 tonnes at 11.6 g /t Au and 4.7% Cu). These types of deposits are typical of other major known VMS environments including Selbaie, Quebec, Eskay Creek, B.C. and Mount Read, Tasmania.
Work by Largo had outlined two, parallel, at least 6 km long, geological time horizons that host base metal mineralization on the Macuchi property. Debris flows, interpreted to represent the collapse of sulphidic hyrdrothermal mounds, have been observed along one of the horizons. A metre-sized fragment of one of these debris flows returned 75.97 g/t Au, 277 g/t Ag, 1.35% Cu, 49.15% Zn and 2.66% Pb. As previously reported (see press release May 9, 2005), drilling by Largo has outlined an inferred mineral resource of 360,000 ounces of gold equivalent based on US $400 Au/oz, $6.00 Ag/oz and $1.25 Cu/lb (3.9 million tonnes at 1.94 g Au/t, 0.59% Cu, and 7.5g Ag/t) in the Mercedes-Patino area. This resource, which was reviewed and confirmed by T. Hennessy, P.Geo, of Micon International, is open along strike as well as at depth and can be significantly increased by further drilling.
The agreement with Aur follows the completion of Largo's exercise of its option to acquire the 49% interest in the Macuchi property that it does not currently own. In order to complete this acquisition, Largo is required to fulfil its cash payments to the owners of the property of US$1,000,000 and share issuances equivalent to US$500,000 in value over a four year period.
Largo continues to hold a 100% interest in the 60,000+ hectare Cotopaxi property (Ecuador) which covers a 60km strike length that may host the northern extension of the mineralized Macuchi belt.
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