MAG Silver Corp. (MAG:TSX; MAG:NYSE A) announced in a news release, that it has executed an agreement to "consolidate and acquire 100% of the silver-rich Deer Trail Carbonate Replacement Deposit (CRD) project in Piute County, Utah."
The firm advised that the project encompasses about 5,600 hectares and includes 111 patented and 682 unpatented claims covering the historical Deer Trail Mine and the adjoining Alunite Ridge area. The company stated that these properties have been consolidated, allowing it to apply an integrated district-scale exploration approach and that the property shows potential for high-grade silver, gold, lead, zinc and copper CRD sulfides at the Deer Trail mine, which may be linked to a porphyry copper-molybdenum center situated to the west near Alunite Ridge.
The company's Chief Exploration Officer Dr. Peter Megaw remarked, "Deer Trail has been on my exploration radar since 1982, as it displays the most important characteristics of a large porphyry-related CRD system. Consolidating the property lets us apply our integrated exploration model and apply new technology to the search for the entire suite of mineralization styles that we expect to occur on the property...Our experienced CRD exploration team is excited to see what unfolds over the next few months as we begin drilling for more extensive high-grade silver-gold-lead-zinc CRD and skarn mineralization below the historic mine."
MAG Silver's President and CEO George Paspalas commented, "Utah is a new jurisdiction for MAG and we are very pleased with the outpouring of positive support for the Deer Trail Project from this historically mining-friendly community...As we integrate into the community, we are operating in a manner that reflects our values: commitment to health, safety, social responsibility and environmental stewardship. We expect to be here for some time."
The company indicated that its fall 6,500-meter phase 1 surface drilling program is fully permitted and is scheduled to commence in early October 2020. The firm stated that the program will focus on initial targets that were identified based upon an integrated 3D Leapfrog GeoŽ project combining a large historical data set with MAG's CRD exploration model plus extensive new surface and underground mapping data.
MAG Silver advised that it executed an agreement in December 2018 to consolidate the Deer Trail Mine and surrounding Alunite Ridge area. All of the other involved parties contributed their respective Deer Trail claims and property rights to a newly formed company for a 99% interest in the company with MAG Silver owning 1%. MAG noted that it is the project operator and under the terms of the agreement it has the right to earn a 100% interest in the company and the Deer Trail Project, with the other parties retaining a 2% NSR. The company stated that it must make a total of US$30 million in escalating annual expenditures and US$2 million in royalty payments over 10 years in order to earn in 100% interest in the project.
The company noted that the Deer Trail project meets all of its top criteria when exploring for large CRD systems. Specifically, these criteria include the presence of high silver grades (>400 g/t), location on a deep-penetrating regional-scale fault that hosts major CRD-family deposits, location at the top of a thick section of favorable host rocks and an identifiable plumbing network.
MAG Silver explained that has a two-fold exploration strategy designed to work both ends against the middle. The first strategic focus is to project the geometry of the feeder structures of the known CRD mineralization to depth to seek large scale silver-rich massive sulfide replacements and potentially mineralized skarn. The firm plans to undertake an underground 2-D seismic survey later this month, which it expects to help map out favorable host rocks at depth, trace major mineralization feeder structures and potentially detect massive sulfide mineralization. Phase 1 drilling to test this end of the deposit spectrum is planned to begin in early October 2020.
The firm added that the second focus will be the exploration for the system's intrusive "source" as this could be an economic porphyry copper/molybdenum deposit in its own right and as such may also aid in defining an exploration corridor carrying continuous mineralization from the porphyry through mineralized skarn to the inferred extensive high-grade replacement mineralization.
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