Media Luna West drilling points to future Morelos mill feed

Summer drilling at Media Luna West returned 29.76 grams gold equivalent per tonne over 14.1 metres, including 27.5 grams gold, 27.9 grams silver and 1.2% copper. The interval in hole ML23-086A, north of historic high-grade intercepts, suggests an extension over 600 metres, like the nearby EPO deposit.

“While exploration at Media Luna West is still at an early stage relative to the nearby Media Luna and EPO deposits, the latest results, when combined with historical results and a new structural model, highlight the potential for Media Luna West to become a future source of feed for the Morelos Complex,” Torex CEO Jody Kuzenko said in a release.

Canaccord Genuity Capital Markets mining analyst Jeremy Ho says these results could mean a longer life for the Morelos mine, which is crucial as current sources start to deplete by 2028.

The Thursday after-market news sent Torex shares up 7% on Friday to $15.53.

This year’s exploration program at Media Luna West, an early-stage target which does not yet have a defined resource, comprised 9,722 metres over seven drill holes. The program was designed to prove the continuity of historical drilling in the area (completed in 2012 and 2013) based on the structural trends and orebody knowledge gained at the nearby EPO deposit since 2022.

Torex has found that skarn-hosted and gold-silver mineralization occurs in areas of extensive fracturing near fault footwalls, mainly where North-South dykes are present. The gold is typically free-standing and not associated with previous copper mineralization events.

Current intercepts suggest Media Luna West trends north-south with a width similar to EPO. For context, EPO has a February 2022 inferred resource of 8 million tonnes at 3.97 grams gold equivalent (1.52 grams gold, 34.6 grams silver, 1.27% copper) for 1.02 million oz. gold equivalent.

As of year-end 2022, the Morelos Complex has proven and probable reserves of 38.6 million tonnes grading 3.98 grams gold equivalent per tonne (2.91 grams gold, 17.1 grams silver, 0.58% copper) for 3.6 million oz. gold, 21.2 million oz. silver and 493 million lb. copper.

In mid-November, Torex received the final environmental approval to finish building the $848-million Media Luna mine.

Shares have traded over the past 12 months in a band between $12.40 and $25.40. Torex has a market capitalization of $1.3 billion.