Aura is Proving Up Its Mexico Silver-Gold Project
By Ted Niles
Robert Boaz’s assessment is about as straightforward as they come. “We’re going to have a mine there,” the President/CEO of Aura Silver Resources says of the Higo Blanco prospect on its Taviche silver-gold project. “This is a system that is approximately two kilometres long. If you’ve got two kilometres of fairly decent mineralization over wide widths, you have a mine.”
Aura currently holds a 46.8% interest in the Taviche project, located in Oaxaca State, Mexico. Its joint venture partners, Pan American Silver and Intrepid Mines, hold 30% and 23.2% respectively. The project consists of three property concessions—West Taviche, East Taviche and Alma Delia—covering 52,340 hectares of the San Jose Mining District. Aura has been concentrated mostly on Higo Blanco, a mineralized complex running through the East Taviche and Alma Delia concessions.
Boaz remarks, “We started to do some significant drilling [on Higo Blanco] back in 2008. What we’ve been doing since is trying to step out from those initial holes and determine two things: How far does the mineralization go, and where is the source?” May 24 assays of Higo Blanco include 89.8 grams per tonne silver over 5.8 metres, 33.2 g/t over 27.5 metres and 23.1 g/t over 122.7 metres (including 68.4 g/t over 22.9 metres). Notable gold results include 0.81 g/t gold over 7.5 metres and 0.62 g/t gold over 4.4 metres.
“At this stage, we have not found the source,” he continues. “The geology, as anywhere in Mexico, is difficult. However, we have identified that, with the mineralization from surface to 200 metres, we have this continuous stratified layer of silver and gold mineralization. That is quite exciting.”
Aura plans to have a resource estimate for Higo Blanco completed before September 1. “That’s a requirement of the option agreement with Pan American,” Boaz explains. “Then they can make a decision whether they want to continue with their 30% or allow us to dilute them down. My guess is that Higo Blanco will not be huge yet, because we haven’t got enough drill holes in the ground. But we’re excited about the prospect. There’s something there. And it’s something that no one can walk away from. We just have to continue to drill.”
There’s something there. And it’s something that no one can walk away from. – Robert Boaz
It is also worth noting that the West Taviche concession shares a boundary with Fortuna Silver’s San Jose Project. With silver equivalent resources of 37.6 million ounces indicated and 30.36 million ounces inferred at a 150 g/t cut-off, their San Jose Mine is slated to begin production in Q3 2011. “It’s obvious that their resource goes onto our property,” exclaims Boaz. “We have yet to get approval from the community to drill on that part of our property, but we’re coming very close. I think we’ll be drilling there in a couple of months, which means we’ll probably find the other half of Fortuna’s San Jose Mine resource.”
While Aura has the potential to earn in excess of a 70% interest in the Taviche project, Boaz does not expect that Aura will take it to production by itself. “We are not production people,” he says. “Unless we make a conscious decision to bring people in who understand how to mine, my guess is we’ll enter into partnerships with established miners. In my discussions with Pan American Silver—and we have a great relationship with them—they’ve told us that once we’ve put the resource together, once it becomes mineable, they would like to be operators. And, quite frankly, who else would you want to operate a mine but Pan American?” He adds, “The quid pro quo is they would like us to develop other properties that they have as operators.”
Aura Silver has a market cap of $19.6 million and traded at press time at $0.24 per share. The company’s other major project, Greyhound, is a high-grade silver and base-metals property in Nunavut, 32 kilometres south of Agnico-Eagle’s Meadowbank Mine.