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Buenaventura advances Minas Chanca Silver project

Buenaventura advances Minas Chanca Silver project
October 17
13:45 2011

VANCOUVER, CANADA – Focus Ventures Ltd. released a progress update Monday on its Minas Chanca project. Compañia de Minas Buenaventura (“Buenaventura”) is earning into the project under an option agreement.

Buenaevnture minas chanca Buenaventura advances Minas Chanca Silver project

Exploration advances continue at the historic Minas Chanca mine, Peru. Photo: Focus Ventures Ltd. website.

Buenaventura is conducting an 8,000m drill program around the historic mine and recently added a second surface drill rig and two underground rigs to expand the program. Buenaventura has also rehabilitated over 960m of tunnels over 6 levels of the old mine, with rails to handle mining equipment installed to Level 500.

Three surface diamond drill holes have been completed to date, which gave the following intercepts:

  • Hole CAN11-03 1,153 g/t Ag (37 oz/t) + 0.2% Pb + 0.3% Zn over 1.85m from 10.75m downhole (new vein)
  • Hole CAN11-02 204 g/t Ag (6.6 oz/t) + 0.04% Pb + 0.09% Zn over 1.05m from 210.4m downhole (Santa Toribio Vein )

A program of 2,300 underground surface and channel sampling has been completed including 818 underground and 1,144 surface samples. Work is focussing in the northern part of the mine, on the Santo Toribio and Prescilda veins where a development drive is in progress to allow underground drilling of the extensions of the structure. Underground channel sampling on various mining levels, representing nearly 300m vertical extent of the Santo Toribio vein, has returned some selected results of up to several kilos per tonne Ag with appreciable gold and base metals, including:

Sample ID
Level
Width (m)
Ag g/t
Au g/t
Pb%
Zn%
CANCM681
500
2.05
242
0.20
0.4
0.3
CANCM544
620
0.40
3,410
4.15
0.2
0.2
CANCM553
620
1.35
2,290
3.20
1.4
2.3
CANCM582
620
0.55
1,480
0.66
0.2
0.2
CANCM827
660
0.65
462
11.80
0.1
0.2
CANCM735
922
0.65
665
0.20
3.8
5.3
CANCM734
922
0.40
440
0.18
3.0
4.

 

Mineralization is associated with milky quartz veins with ruby silver and argentite. Additional drill results will be announced when available.

Background

The Minas Chanca Ag-Pb-Zn mine is located 160km north of the Peruvian capital, Lima, within Central Peru’s prolific Polymetallic Belt, at altitudes of 4,400 — 4,900 meters above sea level. It is 65km north of Focus’s Santa Rosa property.

References to mining at Minas Chanca date back to 1712 during Spanish Colonial times. Commercial production took place from 1975 with a 180 tonne per day plant and shut down in 1985 due to low silver prices and labor disputes. Past mining took place over approximately 300 vertical meters via a system of galleries, cross-cuts and drives that have been rehabilitated by Buenaventura. The majority of historical silver-lead and zinc ore came from the Candelaria, Tarazca and Santo Toribio veins, where early production reportedly yielded grades of 15 – 25 oz/t Ag.

Buenaventura’s exploration program is testing the depth and strike extensions of the past producing silver veins -the Candelaria, Santo Toribio, Presilda and Silvia veins and splays- and exploring for new mineralized structures.

Buenaventura is earning into a 75% interest in the claims by spending US$3 million in exploration and development over a period of three and a half years, of which $1 million is committed to be spent within the first 18 months. Once Buenaventura vests its 75%, Buenaventura will have the option to acquire Focus’s 25% participating interest by paying Focus $4.00/oz Ag based on resources outlined in a NI 43-101 compliant technical report, or $4 million, whichever is the greater. If Buenaventura chooses not to purchase Focus’s 25% share of the joint venture, Focus will have the option to elect to have Buenaventura provide financing, with repayments to be made through dividends, or alternatively Focus can choose its own financing. A 2% Net Smelter Royalty will be payable to Focus on future production, subject to a buy-out clause of $1 million.

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