Mandalay Resources announces high-grade drill intercepts in Fabiola and Yasna veins under Laguna Verde at its Cerro Bayo silver-gold mine, Chile

TORONTO, Jan. 15, 2014 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX: MND) is pleased to announce the results of its first three, widely-spaced core holes drilled underground from the Dagny mine northeast to intersect the Fabiola and Yasna veins under Laguna Verde (click here for Figure 1 - Laguna Verde Drill Plan View).  All three holes intercepted major veins, tentatively correlated with strike extensions of the Fabiola and Yasna veins (see Figure 1). Two out of the three holes (DLV13-056 and DLV13-086) intersected high-grade silver and gold mineralization over significant widths. In addition, there are additional significant intercepts, especially in DVL12-086, that are not obviously associated with any previously known veins.

Table 1 - Summary intercepts of mineralization tentatively correlated with the Yasna vein

Hole_ID Hole
Compl.
Date
Hole
Depth
(m)
Inter-
cept
UTM_E
Intercept
UTM_N
Inter-
cept
Elev
(m)
From
(m)
To
(m)
Inter-
cept
Length
True
Width
Gold
Grade
(g/t)
Silver
Grade
(g/t)
DLV13-056 30/10/2013 529.9 271851.6 4840878.1 88.3 470.2 471.9 1.7 1.5 0.8 154
DLV13-072 01/12/2013 520.3 271735.0 4840988.3 69.4 446.6 449.1 2.5 2.4 0.2 9
DLV13-086 27/12/2013 603.1 271960.4 4840758.9 42.2 528.7 555.1 26.4 5.3* 3.2 497

*20.3 m intercept - local vein inflection at approx. 15º to core axis defined a true width of 5.3 m

Table 2 - Summary intercepts of mineralization tentatively correlated with the Fabiola vein

Hole_ID Hole
Compl.
Date
Hole
Depth
(m)
Inter-
cept
UTM_E
Intercept
UTM_N
Inter-
cept
Elev
(m)
From
(m)
To
(m)
Inter-
cept
Length
True
Width
Gold
Grade
(g/t)
Silver
Grade
(g/t)
DLV13-056 30/10/2013 529.9 271817.3 4840863.4 91.7 432.4 434.8 2.4 2.1 12.5 2747
DLV13-072 01/12/2013 520.3 271722.0 4840976.6 70.1 427.9 432.8 4.9 4.7 0.1 6
DLV13-086 27/12/2013 603.1 271910.1 4840753.7 48.8 483.9 493.0 9.1 6.4 1.8 854

All significant intercepts averaging greater than 100 grams/tonne ("g/t") silver ("Ag") in these three drill holes are reported below.

Brad Mills, CEO of Mandalay, commented, "The mineralization encountered in these holes establishes that the mineralizing system responsible for both the Fabiola and Yasna veins extends for at least 500 m to the southeast beyond the limits of our current ore reserves.  The widths and grades of mineralization are exceptional in DLV13-056 and DLV13-086, the southeasternmost two holes. At present, the geometries of the mineralized veins, especially those encountered in DLV13-086, are not entirely understood and it will require additional drilling to correlate them confidently in three dimensions."

"Wide-spaced drilling under the lake will resume shortly, after scheduled drill rig maintenance, focusing on the Coyita vein part of the system.  Once the preliminary phase of wide-spaced test drilling is complete, we will implement a formal infill program to convert the priority targets identified in this drilling to resources and reserves. The strike length and tenor of these vein extensions suggests the possibility of defining significant new mineral resources in the Fabiola, Yasna and nearby veins following infill drilling."

Cerro Bayo drilling and assaying

Diamond core was drilled from an underground station in the Dagny mine.  All holes were directionally surveyed.  Core was logged and sampled by Mandalay geologists. Core samples, including blanks, standards, and duplicates, were assayed on-site at the Compañia Minera Cerro Bayo laboratory. The Cerro Bayo laboratory, which was audited in 2011 by SGS Lakefield Research Ltd., routinely sends check samples to ALS Laboratory (an ISO 9001:2008 and ISO/IEC 17025:2005 certified laboratory) in La Serena, Chile, following QA/QC practices established by Mandalay. See the Company's previously filed technical report entitled "Technical Report on the Cerro Bayo Project, Region XI (Aisen), Chile", dated March 20, 2013, for a full description of the drilling, logging, assaying, and estimation processes, including data verification measures.

Locations of the veins discussed in this Press Release appear in Figure 1, along with the locations and orientations of the drill holes.

Cerro Bayo drilling results

The three tables below present significant assay intervals from the three reported holes.  All assay intervals tentatively correlated with the Fabiola and Yasna veins are included, plus all significant intervals averaging greater than 100g/t Ag in other veins.  "Stringer" zones adjacent to larger veins consist of closely spaced veinlets hosted by altered wall rock.

Table 3 - DLV13-056

DRILLHOLE DLV13-056
Sample Vein From To Length
(m)
Gold
Grade
(g/t)
Silver
Grade
(g/t)
411282 Other Vein 430.30 430.60 0.30 0.79 209
             
411288 Fabiola 432.40 433.40 1.00 8.85 1510
411289 Fabiola 433.40 434.35 0.95 21.53 5162
411291 Fabiola 434.35 434.80 0.45 1.68 396
             
411316 Yasna 470.20 470.50 0.30 2.92 812
411317 Yasna 470.50 471.25 0.75 0.33 8
411318 Yasna 471.25 471.85 0.60 0.27 6
             
411333 Other Vein 510.50 511.50 1.00 0.63 110

Table 4 - DLV13-072

DRILLHOLE DLV13-072
Sample Vein From To Length
(m)
Gold
Grade
(g/t)
Silver
Grade
(g/t)
411445 Fabiola 427.90 428.30 0.40 0.05 18
411446 Fabiola 428.30 428.85 0.55 0.05 1
411447 Fabiola 428.85 429.88 1.03 0.05 8
411449 Fabiola 429.88 430.88 1.00 0.05 1
411450 Fabiola 430.88 431.38 0.50 0.05 4
411451 Fabiola 431.38 432.00 0.62 0.05 19
411452 Fabiola 432.00 432.80 0.80 0.05 1
             
411470 Yasna 446.60 447.29 0.69 0.40 22
411471 Yasna 447.29 448.20 0.91 0.05 3
411472 Yasna 448.20 449.05 0.85 0.30 7

Table 5 - DLV13-086

DRILLHOLE DLV13-086
Sample Vein From To Length
(m)
Gold Grade
(g/t)
Silver Grade
(g/t)
413309 Other Vein 277.85 278.55 0.70 3.15 735
             
413323 Other Vein 286.00 287.00 1.00 9.42 4027
             
413370 Fabiola stringers 483.90 484.90 1.00 0.73 228
413371 Fabiola stringers 484.90 485.90 1.00 0.17 106
413372 Fabiola stringers 485.90 486.90 1.00 1.20 553
413373 Fabiola stringers 486.90 487.90 1.00 0.17 39
413374 Fabiola stringers 487.90 488.89 0.99 0.80 518
413375 Fabiola 488.89 489.70 0.81 13.33 6907
413377 Fabiola 489.70 490.35 0.65 0.47 267
413378 Fabiola 490.35 490.65 0.30 0.33 303
413379 Fabiola 490.65 491.40 0.75 0.05 52
413380 Fabiola 491.40 491.85 0.45 1.37 475
413381 Fabiola 491.85 492.55 0.70 1.23 106
413382 Fabiola 492.55 493.00 0.45 1.00 322
             
413401 Other Vein 506.45 507.01 0.56 2.03 282
413402 Other Vein 507.01 508.00 0.99 1.23 101
413403 Other Vein 508.00 508.80 0.80 1.99 121
413404 Other Vein 508.80 509.85 1.05 2.76 119
             
413411 Other Vein 515.10 515.85 0.75 1.33 95
413412 Other Vein 515.85 516.85 1.00 0.99 121
413413 Other Vein 516.85 517.85 1.00 0.72 138
413414 Other Vein 517.85 518.65 0.80 2.06 264
413415 Other Vein 518.65 519.70 1.05 0.67 67
413417 Other Vein 519.70 520.66 0.96 2.92 441
413418 Other Vein 520.66 521.66 1.00 2.73 400
413419 Other Vein 521.66 522.10 0.44 0.93 163
             
413429 Yasna 528.70 529.50 0.80 1.26 594
413430 Yasna 529.50 530.30 0.80 3.07 405
413431 Yasna 530.30 530.72 0.42 1.26 391
413432 Yasna 530.72 531.17 0.45 1.00 177
413433 Yasna 531.17 531.97 0.80 2.61 359
413434 Yasna 531.97 532.70 0.73 2.15 331
413435 Yasna 532.70 533.40 0.70 1.33 281
413436 Yasna 533.40 534.10 0.70 1.91 255
413437 Yasna 534.10 535.25 1.15 1.96 644
413440 Yasna 535.25 535.52 0.27 1.06 187
413441 Yasna 535.52 536.55 1.03 0.93 119
413442 Yasna 536.55 537.40 0.85 1.22 445
413443 Yasna 537.40 538.00 0.60 1.60 672
413444 Yasna 538.00 538.75 0.75 9.63 1394
413445 Yasna 538.75 539.16 0.41 3.03 589
413446 Yasna 539.16 539.80 0.64 15.04 2915
413447 Yasna 539.80 540.83 1.03 6.45 914
413448 Yasna 540.83 541.45 0.62 6.81 961
413449 Yasna 541.45 542.40 0.95 1.02 163
413450 Yasna 542.40 543.55 1.15 3.60 493
413451 Yasna 543.55 544.70 1.15 9.17 807
413452 Yasna 544.70 545.60 0.90 14.45 1299
413453 Yasna 545.60 546.20 0.60 1.35 218
413454 Yasna 546.20 546.60 0.40 0.26 54
413455 Yasna 546.60 547.00 0.40 0.40 77
413456 Yasna 547.00 547.45 0.45 0.66 211
413457 Yasna 547.45 548.30 0.85 0.56 106
413459 Yasna 548.50 549.00 0.50 0.05 13
413460 Yasna 549.00 550.15 1.15 0.26 51
413461 Yasna 550.15 550.83 0.68 0.17 49
413462 Yasna 550.83 551.93 1.10 3.03 562
413463 Yasna 551.93 552.80 0.87 1.69 367
413464 Yasna 552.80 553.80 1.00 1.09 151
413465 Yasna 553.80 554.60 0.80 2.09 378
413466 Yasna 554.60 555.13 0.53 0.73 281
             
413481 Other Vein 578.75 579.25 0.50 2.93 1228
413484 Other Vein 579.25 579.85 0.60 1.71 403
             
413490 Other Vein stringers 584.20 584.50 0.30 0.96 104
413491 Other Vein stringers 584.50 585.15 0.65 5.65 176
413492 Other Vein stringers 585.15 585.45 0.30 0.05 1
413493 Other Vein 585.45 585.90 0.45 4.44 133
413494 Other Vein 585.90 586.15 0.25 0.66 33
413495 Other Vein 586.15 586.45 0.30 1.03 106

Qualified Person

Ronald Luethe, General Manager of Mandalay Chile Ltda., is an Idaho registered Professional Geologist and an AIPG Certified Professional Geologist. As a Qualified Person defined by NI 43-101, he has reviewed and approved the technical and scientific information on Cerro Bayo contained in this release.

About Mandalay Resources Corporation

Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and producing and exploration projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the Company's Mineral Resources, Mineral Reserves, ongoing exploration plans and goals. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 27, 2013, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any current or future Inferred Resources that are discovered as a result of additional drilling will ever be upgraded to Proven or Probable Reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. 

SOURCE Mandalay Resources Corporation

PDF available at: http://stream1.newswire.ca/media/2014/01/15/20140115_C8783_DOC_EN_35526.pdf

For further information:

Bradford Mills
Chief Executive Officer

Greg DiTomaso
Investor Relations

Contact:
647.260.1566