Timmins Gold Corp.: Picacho Property Acquisition, Sonora, Mexico
VANCOUVER, BRITISH COLUMBIA–(Marketwire – Aug. 27, 2008) – Timmins Gold Corp. (the “Company”) (TSX VENTURE:TMM) has entered into an option agreement to acquire a 100 percent interest in the 703 hectare Picacho property located 20 kilometers W-SW of its San Francisco gold mine in Northern Sonora, Mexico. The Company has also staked an additional 6,500 hectares encompassing the claims along the principal trend of the mineralization and now controls over 7,200 hectares in the Picacho area and over 70,000 hectares either proximate to or surrounding the San Francisco Mine and the Sonora- Mojave Megashear. The Sonora-Mojave Megashear is also the host for the multi-million gold ounce, large tonnage, open pit heap leach operations of the La Herradura mine of Newmont/Penoles which is located approximately 120 kilometers to the Northwest of the San Francisco mine.
Picacho was acquired to assess the low grade bulk tonnage potential of the property’s known mineralization given the geological similarities and proximity to the Company’s San Francisco gold mine which is currently under development. San Francisco is expected to resume production in early 2009. Due diligence sampling by the Company on the Property has returned comparatively high grade results with most samples ranging from 0.50 g/t gold to 4.0 g/t gold over 1.0 meter and with several in excess of 12 g/t of gold over 1 meter. The highest grade sample returned 21.946 g/t gold over 0.90 meters.
The Picacho property exhibits two distinct kinds of mineralization with the mineralization in the Western portion of the property being very similar to that identified at the Company’s nearby San Francisco gold mine. This mineralization consists of auriferous quartz veins hosted in a metamorphic complex consisting of gneiss, gabbro, schist and granite-gneiss. La Cornea, El Jabali and Virgen Maria are gold occurrences associated with the quartz veining in this metamorphic sequence. The gold occurrences in the Eastern portion of the property consist of Carlin type mineralization similar to that exposed in many of the past producing mines in the region. The metamorphic unit lay along a discordant contact below a sedimentary sequence. This contact has been interpreted as a detachment zone created by thrusting in the region. The sediments consist of an alternating sequence of quartzite, sandstone, siltstone and limestone that host precious metal mineralization in both mantos and breccias that have developed along the stratification planes. Gold mineralization is found both in the limestone and in the clastic sediments (i.e. sandstone-siltstone). El Murcielago and San Ramon are gold occurrences associated with this sequence.
The Company is currently completing a sampling and mapping program on the old workings and mineral occurrences within the claim group to help define the vertical, lateral and strike extent of the identified mineralized zones. Initial sampling has returned very encouraging results when compared to similar types of mineralized systems in the region (note Tables 1 & 2 disclose results from those samples returning grades in excess of 0.40 g/t Au. Full assay results can be found on the Company’s website at www.timminsgold.com).
Table 1 – El Murcielago sampling – Assay Results ———————————- Sample__ Width________ Au______ Ag No__________(m)______ g/t______g/t ———————————- 13201____ 1.22____ 12.704____ 20.1 ———————————- 13202____ 1.50______1.785______7.5 ———————————- 13203____ 1.25______0.797______0.4 ———————————- 13204____ 1.30______1.066______0.8 ———————————- 13205____ 1.00______3.632______138 ———————————- 13206____ 0.85______1.035____ 19.5 ———————————- 13209____ 0.80______1.621______4.3 ———————————- 13219____ 2.00______0.419______5.4 ———————————- 13220____ 3.20______0.779______7.4 ———————————- 13231____ 2.20______2.027______159 ———————————- Table 2 – San Ramon sampling – Assay Results ———————————- Sample__ Width________ Au______ Ag No__________(m)______ g/t______g/t ———————————- 13238____ 0.40______3.748______4.5 ———————————- 13239____ 0.45______3.982______3.6 ———————————- 13240____ 0.25______0.866______4.2 ———————————- 13252____ 0.50______3.842______2.9 ———————————- 13253____ 1.00____ 13.172____ 20.6 ———————————- 13254____ 1.00______4.077______6.9 ———————————- 13257____ 1.00______7.956____ 11.5 ———————————- 13258____ 1.00______7.256____ 12.1 ———————————- 13259____ 1.00____ 12.339____ 15.1 ———————————- 13261____ 0.70______3.781______5.0 ———————————- 13262____ 0.50______0.294______6.0 ———————————- 13263____ 0.90______0.686______5.0 ———————————- 13264____ 0.60______2.744______9.6 ———————————- 13265____ 0.90____ 21.946____ 21.8 ———————————- 13266____ 1.30______4.608____ 10.1 ———————————- 13267____ 0.90______0.504______9.5 ———————————- 13268____ 0.50______0.984______7.8 ———————————- 13269____ 0.60______0.824______3.4 ———————————- 13270____ 0.80______2.973______4.3 ———————————- 13271____ 0.70______0.519______4.8 ———————————- 13272____ 0.80______0.737______2.7 ———————————-
To exercise the option, the company must pay a total of $1.5- million (U.S.) over a 4 year period in installments. The schedule of payments includes a $15,000 payment every six months during the initial 36 months of the option period, and one single payment of $1,395,000 at the end of month 48. In addition, the vendor is entitled to receive a one and a half percent (1.5%) Net Smelter Return (NSR), capped at $1.5-million dollars. The Company has been granted the option to purchase the NSR at any time for $1.5 million dollars.
Final execution of the option agreement is subject to TSX Venture Exchange approval.
Pursuant to National Instrument 43-101, Darcy Krohman, P.Geo., C.A,. Executive Vice-President and CFO of Timmins Gold Corp. is the Qualified Person (QP) responsible for the disclosure in this news release. Field work has been conducted by Timmins Gold Corp. employees and contractors.
This News Release contains forward-looking statements. Forward looking statements are statements which relate to future events. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, believes”, “estimates”, “predicts”, “potential”, or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, level of activity, performance or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements.
While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect out current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggests herein. Except as required by applicable law the Company does not intend to update any forward-looking statements to conform these statements to actual results.
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