The History of the Royal Mines of Zacualpan Silver District
The Zacualpan Silver District is one of the oldest mining districts in North America, with mining activities dating back to 1527. In 1531, it was the first mining district in the Americas to be given the title 'Royal Mines' of Zacualpan, by proclamation under the Spanish Crown. Zacualpan is located 100 kilometers southwest of Mexico City and 25 kilometers northwest of the well-known historic Taxco Silver Mine, operated by Grupo Mexico. Numerous veins in the district have seen historic production but statistics from the early centuries of production are sporadic. In modern times, recorded silver production between 1975 and 2009 was over 34 million ounces silver equivalent.
IMPACT owns concessions covering most of the Royal Mines of Zacualpan Silver District in central Mexico. Assets include 423 square kilometers of mineral concessions, operating mines, a processing plant rated at 500 tonnes per day (tpd) and a semi-portable processing plant rated at 200 tpd.
The Zacualpan Silver District is host to an excellent mining environment, with a modern power grid, abundant water supply and paved highway access that runs through the middle of the district. Infrastructure throughout the district includes gravel road networks, electric power and an experienced and talented Mexican work force.
San Ramon Mine
In the third quarter of 2012, San Ramon provided 50% of the mill feed (Q3 2011 - 28%) to the Guadalupe Processing Plant from the mining of high grade material. IMPACT recommenced mining at San Ramon in early 2008 on a selective basis with an emphasis on higher grade mineral. Mining continued to expand as underground access to a parallel structure, the Chaparrita Vein, was developed. During the fourth quarter of 2009, a new wide zone of silver-rich stockwork breccia style mineralization was discovered on level 5.5. This zone is now a major contributor to production at San Ramon. During the first quarter of 2012, a second access adit was begun from the valley floor and is anticipated to reach the San Ramon workings at about level 15 in Q4 2012. This second access will reduce mining and hauling costs at San Ramon.
Noche Buena Mine
During the third quarter of 2012, the Noche Buena provided 27% (Q3 2011 - 31%) of the mill feed. The mine is located four kilometers southwest of the Guadalupe Mill and opened in the first quarter of 2010. The mine is contributing a silver-gold feed with low lead and zinc contents to the Guadalupe Plant. This feed is being mixed and balanced with the higher grade lead from other mines to optimize the concentrate value.
The Noche Buena Mine is located in the Valle de Oro area, where IMPACT has also discovered and drilled several gold and copper rich veins including the Carlos Pacheco Vein, located only 200 meters east of the Noche Buena Mine workings. With surface exploration drilling on Carlos Pacheco completed during the third quarter of 2012, IMPACT mine engineers have begun to drive a cross cut from the Noche Buena Mine workings to the Carlos Pacheco gold zone for additional underground drilling and test mining.
The Cuchara-Oscar Mine ("Oscar"), the fourth underground mine that IMPACT has moved into production within 24 months of drilling the first exploration hole, commenced production in the first quarter of 2013. Oscar encompasses a corridor of high-grade silver veins located 2.5 kilometers east of the Guadalupe Processing Plant. In April 2012, IMPACT announced further drill results from Oscar including 1,875 g/t silver across 1.00 meter and 115 g/t Silver across 23.39 meters (see IMPACT Silver News Release dated April 2, 2012).
Exploration plans for 2013 include a 35,000 meter drill program that will focus on expanding the Capire zone to determine the size and capacity of the permanent plant, on aggressively continuing drilling in the Valle de Oro gold zone to explore the potential of this new gold-copper district, and determining the potential of the recently discovered Mirasol prospect of becoming the next producing mine.
IMPACT's past exploration activities has seen early success by developing mines from discovery hole to production within a time period of 12 to 24 months. The Chivo Mine (phased-out of production in 2012) was first drilled in 2006 and in less than 24 months, was brought into production as the largest and highest grade silver producing mine in the district. The rapid conversion of discovery to profitable production is a hallmark of IMPACT's technical team at Zacualpan and a cornerstone of the IMPACT's mining success.
In 2006, the Company initiated a district wide compilation of the historical exploration and mining information on the total land package. The historical information is considerable, with maps occupying several rooms at the mine site in Zacualpan. Although work on this GIS (Geographic Information System) database is ongoing, selected areas currently have a sufficient degree of completeness to direct modern exploration programs of prospecting, mapping, trenching, sampling, and drilling.
To date, over 3,000 historical mine workings have been located and entered into the GIS database with prospecting and researching old maps adding an average 10 to 15 more per week.
Carlos Pacheco - A Gold-Copper Project
The Carlos Pacheco is IMPACT's gold-copper discovery located six kilometers southwest of the Guadalupe Mill and 200 meters east of the Noche Buena Mine. Fieldwork in the area began in 2007 with a systemic mapping and rock sampling program, followed by an initial drill program that cut high grade gold intersections up to 19.6 g/t gold across 2.9 meters including 49.7 g/t gold across 1.0 meter.
Both the Noche Buena and Carlos Pacheco Veins have strike lengths in excess of eight kilometers, with numerous zones of enriched metal content as outlined by regional mapping and prospecting. To date, drilling has tested 500 meters of strike length on these veins.
On July 11, 2012, IMPACT announced final drill results from the Carlos Pacheco Gold-Copper project. This drill program focused at depths of 120 to 250 meters, which is below an inclined shaft on the Carlos Pacheco Vein that IMPACT's mining group re-opened and sampled. This work indicated good continuity to the gold-copper grades for the Carlos Pacheco Vein and provided the impetus for this drill program.
Intermediate Veins at Noche Buena
In addition to the gold-copper mineralization in the Carlos Pacheco Vein described above, drill holes in the program intersected silver-lead-zinc mineralization in the Intermediate Veins. The Intermediate Veins are a newly discovered vein cluster located midway between the Carlos Pacheco and Noche Buena Vein.
The work of IMPACT's exploration team for this portion of the Carlos Pacheco and Intermediate Veins is now complete and the data has been passed to the mine planning group for engineering studies, underground drilling and potential production.
Future Plans & Goals
2012 was a transition year for IMPACT as two new mines were built, the open-pit Capire Mine and the high grade silver Oscar Mine, representing the foundation for the next phase of production growth.
IMPACT Silver plans to significantly increase production through the following objectives in 2013:
- Aggressive exploration to accelerate organic growth at the Royal Mines of Zacualpan.
- Complete additional and continual improvements to the 500 tpd processing plant to increase recoveries and throughput.
- Double silver production in the next three to four years with the expansion of the Capire Production Center.
- Continue exploration and development of both silver zones and deep gold horizons in the Valle de Oro area.