VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 03/28/13 -- South American Silver Corp. (TSX: SAC)(OTCQX: SOHAF) reports the release of its audited consolidated financial statements for the year ended December 31, 2012 and the related management's discussion and analysis of financial position and results of operations ("MD&A"). In this press release, all amounts are expressed in U.S. dollars, unless otherwise indicated.
As at December 31, 2012, the Company had working capital of $23,018,910, including cash and cash equivalents of $24,242,113. With these funds in place, the Company is in a strong financial position to complete a successful drilling season and expand resources at Escalones; set up for a successful outcome in the investment treaty dispute with Bolivia; acquire new attractive exploration targets; and rebrand the Company to reflect its new strategic direction.
Further details including the full financial statements and information on each of the Company's projects, including the resource estimate at Escalones, the Bolivian arbitration case, and the 19.9% interest in High Desert Gold, are available on the Company's website at www.soamsilver.com and on SEDAR at www.sedar.com.
The Company has 3 diamond drills on site. The current drilling program is intended to fill gaps in the resource model in order to expand resources in the porphyry and skarn environments. Over 10,000 metres of diamond drilling were planned for the season, however progress has fallen behind schedule after a severe storm cut off road access to the property for approximately four weeks in February. As at March 28, 2013 over 6,200 metres have been drilled. The duration of the summer drilling program at Escalones is weather dependent and the season typically closes by around mid-April. If the drilling season ends in mid-April, it is expected that approximately 8,500 metres will have been drilled. An updated resource estimate is scheduled for completion by mid-year.
The estimated cost for the Escalones exploration plan is $10,700,000. It includes the 2013 drilling season program (November 2012-April 2013) of over 10,000 metres of diamond drilling, a $3,000,000 option payment to acquire Escalones which is due in June 2013 and an updated resource estimate scheduled for completion by mid-2013. As at December 31, 2012 the Company had spent $1,237,306 of the total amount planned.
Drill results from drill hole 36 (ES-36) indicate the existence of a previously unidentified zone of primary copper that has been enriched with secondary copper that has leached from the rock above. If further drilling shows that this style of mineralization continues throughout the Meseta, the previously reported resource of 3.8 billion pounds of copper at 0.41% could be greatly enhanced.
The results of drill holes 38, 39, and 41 (ES38, ES39 and ES41) continued to show a near horizontal zone of leached material that is generally gold rich, typically 50-100 metres thick, and underlain by an irregular near horizontal zone of 20-120 metres of copper enrichment. This copper enrichment zone is the top portion of a long column of copper mineralization which in hole ES-38 is more than 450 metres thick. Results analyzed so far indicate that this style of copper-gold mineralization exists over an area approximately 500 by 800 metres.
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