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Gold discovery at Del Carmen project accelerates Malbex’s exploration in prolific El Indio Belt

By Resource Intelligence · March 25, 2011 · 11:00 am · Leave a Comment

www.malbex.ca • 416.862.2246

Tim Warman
President & CEO

Malbex Resources (TSXV: MBG) is exploring for gold in Argentina’s rich El Indio Gold Belt, which hosts over 40 million ounces of gold in past production and current reserves. The company’s drill program in 2010 has unearthed a “discovery hole” that propelled the company to shift its drill program at Del Carmen Norte into high gear this year. President and CEO Tim Warman discusses the company’s flagship project and its prospects.

Resource Intelligence: Del Carmen is your flagship project; could you update us on the latest developments?

Tim Warman: Our main focus is the drill program that’s been going on since mid-November. We aim to drill about 10,000 metres this year. The results we’ve announced from the first two holes on that program have been very good: the highlight of that was 73 metres with just over 1.03 g/t gold equivalent. It was a good hole, very comparable in grade and length to the drilling we did last year, and there will be a lot more results coming as the season progresses. We just completed preliminary metallurgical testing that indicated there is good potential for heap leach cyanidation treatment, and we’re drilling some of the big geophysical targets that came out of our geophysical survey from last season. Our goal now is to do enough drilling this season so that we’ll have the data to do an inferred resource calculation on an area of Del Carmen Norte called Rojo Grande sometime this summer.

RI: Could you give us a sense of the potential economic value of the project?

TW: Our first resource will come from an area at Del Carmen Norte, called Rojo Grande. From what we can see from the drilling we’ve done at Rojo Grande so far, a resource somewhere around 1 to 3 million ounces seems feasible if we continue to be successful with the drilling. That’s our first-stage target. In addition to that one target, we have a number of other large targets we will be drilling in this 9 km2 alteration zone at Del Carmen Norte.

RI: Can you describe the area where the project
is located?

TW: It’s a very easy area to work so this will benefit our costs when it comes to the production stage. The road network is already there and our property is about 10-minutes drive off of the main Barrick access road to their Veladero and Pascua Lama mines. We can drive up from San Juan, the province’s capital city, in under five hours. The only infrastructure lacking is power, but there are plans to bring in grid power from Chile so the infrastructure is getting better.

RI: What are your priorities this year?

TW: This year is really focused on drilling. What’s really going to get the shareholders and the market excited is to demonstrate that this is a real deposit and that we’ve made a significant discovery.

RI: What recent achievement has added value to the company?

TW: The final hole from last season’s drill programwas our best hole at 142 metres with 0.88 g/t gold and 13.7 g/t silver. It was our “discovery hole,” and it really caught people’s attention. Prior to that we had very little to go on. We had surface sampling, but that drilling really shows that we had that third dimension there.

RI: You went public last year. What’s the IPO’s impact in terms of the company’s funding?

TW: Last summer in the middle of a very difficult market, we were able to raise $12.6 million. That has put us on a very strong footing in terms of funding our drill program over the next 12 months.

RI: Which other projects will you be advancing this year and could you update us on those?

TW: The other project we’re drilling this season is called Despoblados. We completed a drill program just before Christmas of about 1,400 metres on some silver/gold vein systems. We haven’t got all the results back for that. Then of course we are looking at acquiring new properties, principally properties that we can work on year round.

RI: How would you describe your company’s accomplishments so far and to what would you attribute those?

TW: I think a key accomplishment has been that we took an area that was, at the time, a property up in the Andes that nobody knew much about, had very little exploration done on it before, and we advanced it, thanks to our first-class geological team, and came up with a real discovery.

RI: Give investors three reasons why they should invest in Malbex.

TW: It’s really a combination of the people, the projects, and the jurisdiction. The team is mostly comprised of former Aurelian executives. Aurelian Resources was one of the big success stories of the last few years in the junior industry. We’ve got an incredible powerhouse board with people like Terry MacGibbon, David Garofalo, Patrick Anderson and Joe Hamilton, who are all very well known names in the mining industry. In terms of the projects, we’re in a world-class gold belt with the smallest mine in the belt having 4.5 million ounces and the other two at 14 million and 18 million ounces, and where there has really only been four or five years of exploration carried out on the Argentinian side of the belt. We really think there is a tremendous amount of potential in that. Lastly, the jurisdiction: San Juan province in northwestern Argentina is mining-friendly, it has an incredibly supportive government and a mining workforce.

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