Melchor Ocampo is located in the Concepcion del Oro region of northeastern Zacatecas state near the border with Coahuila state. Mineralization in the Concepcion del Oro region consists of carbonate replacement deposits (CRD) including several large mines and significant historical producers at Concepcion del Oro, Terminal de Providencia, Salaverna, Santa Rosa, Noche Buena, Melchor Ocampo, and the huge Peñasquito mine.
The Concepcion del Oro region is within the Sierra Madre Oriental fold and thrust belt. The geology is characterized by alternating anticlines and synclines. Most of the rocks exposed are Jurassic and Cretaceous platform sedimentary rocks, although some older volcano-sedimentary basement rocks are present in the San Julian area. In several areas, the sedimentary rocks have been intruded by intermediate plutons of Late Tertiary to Early Cretaceous age. The mineralization in the region is generally closely associated with intrusive rocks and consists of skarns and replacements as mantos, chimneys and irregular bodies controlled by lithology and structures.
Sierra drilled 12 core holes at the Las Coloradas project during 2010-2011 and seven of them intercepted intervals of potentially-economic CRD mineralization, as shown in the table below:
Assay Results from Selected Drill Holes at Las Coloradas
| Drill Hole* |
From (m) |
To (m) |
Core Length (m) |
Silver g/t |
Lead % |
Zinc % |
Copper % |
| 10B001 |
165.0 |
284.6 |
119.6 |
65.6 |
1.16 |
1.43 |
0.11 |
| 10B005 |
152.4 |
282.0 |
129.6 |
72.6 |
1.38 |
1.62 |
0.10 |
| 11B006 |
230.0 |
347.4 |
117.4 |
59.9 |
1.00 |
1.30 |
0.01 |
| 11B008 |
287.8 |
335.7 |
47.9 |
57.2 |
0.89 |
1.32 |
0.14 |
| 11B009 |
135.5 |
142.9 |
7.4 |
163.2 |
0.50 |
1.28 |
0.04 |
| 11B011 |
123.7 |
144.9 |
21.1 |
49.8 |
1.14 |
1.27 |
0.07 |
| 11B012 |
184.5 |
212.4 |
27.9 |
109.4 |
1.93 |
1.87 |
0.16 |
*All drill holes have prefix DLC0
All holes were collared in sandstone and shale east of a wide (approx. 100 m) near-vertical, E-W trending fault zone and crossed into the Taraises Formation (thin-bedded limestone and mudstone) and then entered the La Caja Formation (siltstone and thick-bedded limestone) that was converted to skarn by intrusions of granodiorite. The lower portion of the Taraises Formation is also skarnified. Underlying the skarnified La Caja Formation is the Zuloaga Formation (massive limestone), which is generally unmineralized.
The Company believes that a potentially-economic CRD underlies the property.