Assays from the SW Zone has defined new, laterally extensive, high-grade mineralised lenses above and below the main gallery level, with assays such as 13m at 5.5% zinc, including 4m at 12%; 11m at 3.2% and 17m at 2.1%.
The SW Zone remains open to the south with significant potential for further extensions. “Unsophisticated” mining in the area ended in the late 1990s, and there has been no exploration since.
Along the Los Caracoles Trend, the lenses were intercepted below the main gallery level, with hits such as 7m at 6.4% zinc, including 3m at 9.1%, extending the known mineralisation by a further 180m.
Managing director Stewart Dickson said the results confirmed the merits of further infill drilling targeting the underlying gallery levels.
“The discovery of new high-grade mineralised lenses above and below the main gallery in two distinct areas of the mine strongly suggest there is considerable scale and tonnage potential,” he said.
The company believes the mine is a multi-layered deposit, consistent with Mississippi Valley-type sulphide orebodies.
Further drilling is planned later this month.
The company acquired the Novales-Udias project some 12 months ago, and claims it is one of the best advanced zinc-lead prospects in the world, and may be the twin brother to Spain’s largest known zinc-lead deposit at Reocin, just 10km away. Reocin was one of the world’s richest deposit deposits before its closure in 2003.
San Jose produced in the 1970s and 1980s at a 7-9% head-grade, closing when zinc was priced at US$1300 per tonne, around one-third of where it is today.
It is the first company to drill San Jose in 30 years.
Variscan shares jumped 8% today to A7c, valuing the company at $17 million.
The stock has traded between 2.3-15c over the past year. It recently completed an oversubscribed $4.25 million placement at 8c.