Chilean gold mine results 'encouraging'

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SANTIAGO, Chile, March 15 (UPI) -- Exploratory drilling at three new gold mines in Chile has produced encouraging results but needs follow-up scientific work, Canadian gold producer Orosur Mining Inc. said.

Orosur Mining Inc. operates the only producing gold mine in San Gregorio, Uruguay, and has assembled an exploration portfolio of high quality assets in Chile, including sites at Talca, Pantanillo and Anillo.

Gold futures for April closed Wednesday at $1,642.90 per troy ounce on the New York Mercantile Exchange.

Chile is the world's top copper producer and extracts gold as part of the copper processing. Chile, Latin America's fourth largest gold producer, is also building its dedicated gold and silver industry.

Government plans call for gold production to top an estimated 1.5 million ounces produced each year. Orosur's plans are expected to supplement that effort.

The company said its drilling campaigns at Talca, Pantanillo and Anillo had all been positive.

Initial assay results from three holes drilled at the Talca site produced encouraging results "consistent with expectations for these targets," Orosur Mining Inc. said in a statement.

Deep drilling at the Pantanillo project in Chile and subsequent sampling and mapping "supports the potential for discovery on these targets and follows up historical drilling and trenching on these targets by previous operators," the company said.

Orosur Chief Executive Officer David Fowler said, "Initial drilling in the southern sector at Talca is encouraging with intercepts confirming the potential for multiple narrow high grade gold mineralization over a potential strike length of [1,640 feet]."

He said Talca and the Metallera central zones, significant historical production areas, are the focus of current drilling.

Drilling also commenced at the Pantanillo project on three priority targets. Results are expected in May and June.

The major focus of exploration that began in January is to identify areas where additional resources can be established to increase potential mine life at Pantanillo before proceeding with the completion of a pre-feasibility study on the site, the company said.

Meanwhile, Australian gold producer Lachlan Star also announced encouraging results around the Tres Perlas deposit at its wholly owned mine in the country.

Lachlan Star Managing Director Declan Franzmann said drill results confirmed the belief the Tres Perlas area contains a major mineralized system.

"The area is under drilled and our recent drilling is indicating good gold grades over wide intervals, with potential to increase the contained ounces," he said.

He said the presence of material copper grades in association with gold is also encouraging.

Tres Perlas has an indicated resource of 1.72 million ounces of gold and an inferred resource of 1.25 million ounces of gold.