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Drilling 'Highlights More Resource Potential' at Mexico Project
Research Report

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Results from drill and water well testing at Minera Alamos' project and their implications are reviewed in a Haywood research report.

Haywood analyst Kerry Smith reported in a Feb. 6 research note that drilling and water testing yielded positive results at Minera Alamos Inc.'s (MAI:TSX.V; MAIFF:OTCQB) Santana open-pit, heap-leach gold project.

Results are in for the first two follow-up holes drilled as part of Minera Alamos' phase two program at Santana, and they suggest additional resource potential, Smith highlighted.

Drilled to a depth of 200 meters (200m) at the Divisadero discovery at Santana, the holes returned 0.42 grams per ton (0.42 g/t) gold over 96.4 meters (96.4m) and 0.56 g/t gold over 133.6m. Mineralization remains open in multiple directions.

Because Divisadero is 1 kilometer from the Nicho resource, it could become a satellite pit to it. Mining at Nicho is slated to begin later this year, Smith indicated. "The likely cutoff grade for Santana will be 0.2 g/t, suggesting good potential to add mineable resources at Divisadero," he added.

Smith pointed out, too, that further zones of mineralization may exist at Santana. It may be found in the series of brecchia pipes on the property, as only two have have been drilled to date. The larger, porphyry-hosted Divisadero discovery suggests potential for different types of mineralization at Santana as well.

As for the well drilling, it revealed two areas where water volumes were high and, thus, could support the Santana project, noted Smith. The 800m of exploratory water well drilling identified five areas containing water, and two of those were chosen for further follow-up and pump testing. "We expect Minera Alamos will have adequate water for the current and any expanded future operation," commented the analyst.

With a drill budget of CA$2 million, Minera Alamos intends to drill 2,500–3,000m each quarter this year. With the new roads it plans to build, drill access will be improved.

Haywood has a Buy rating and a CA$0.50 per share target price on Minera Alamos, whose stock is currently trading at around CA$0.27 per share. "We recommend accumulating shares at current levels," Smith wrote.


1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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Disclosures from Haywood Securities, Minera Alamos Inc., February 6, 2020

Analyst Certification: I, Kerry Smith, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.

Important Disclosures
Of the companies included in the report the following Important Disclosures apply:
▪ Haywood Securities, Inc. has reviewed lead projects of Minera Alamos Inc. and a portion of the expenses for this travel have been reimbursed by the issuer.
Other material conflict of interest of the research analyst of which the research analyst or Haywood Securities Inc. knows or has reason to know at the time of publication or at the time of public appearance: n/a.

Research policy is available here.

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