VANCOUVER, B.C., May 28, 2014 (GLOBE NEWSWIRE) -- The coat of arms of the city of Bathurst, a regional centre in northern New Brunswick, includes four triangular panels with symbols representing the area's principle industries, those being farming, fishing, forestry and, appropriately enough, mining. The city is, after all, located in the heart of the rich and productive Bathurst Mining Camp.
Mineral deposits were first discovered in the area in 1952 and, since then, mining companies have pumped over a quarter of a billion dollars into exploration. According to the New Brunswick government, 46 mineral deposits have been discovered with defined tonnages and another 100 mineral occurrences.
Bathurst itself was the site of the Brunswick Mine, which opened in 1964 and was for a time one of the world's largest and most profitable zinc mines. It closed in 2013, but two new mines are currently in development, As well, a number of junior mining companies are actively exploring in the area and Puma Exploration (TSX-V:PUM) owns one of the most promising properties.
Puma's Nicholas-Denys property stretches over 6,750 hectares and the drilling that Puma has done to date--120 holes totaling 20,000 meters of core samples--has revealed nine deposits in three different mineralized zones over a strike length of 10 kilometers. One contains promising shows of silver, along with lesser amounts of lead and zinc. A second holds copper while the third may well prove to be a world-class copper and molybdenum deposit.
"It's a big, big system," says President and Chief Executive Officer Marcel Robillard. "The whole mineralized area extends over 34 square kilometers. The net result of the work we've done so far is that we have a very large, highly mineralized copper-molybdenum-silver system in three separate and distinct types of geological deposits. It's a big challenge and really interesting since we have had to adapt our exploration methods to deal with such a diverse range of minerals deposits. It just kept growing!"
The company acquired the property in bits and pieces in 2006 from about 15 individual prospectors and small companies, says Robillard, who was then Puma's chief geologist. The previous owners had explored the lands they held, but the work they did wasn't sufficient to assemble a complete picture of the three mineralized zones or their potential.
Robillard, who became president in 2009, says his predecessor decided to work on the silver prospect first for a variety of reasons, notably the record high silver prices. Preliminary exploratory work indicated that the deposits were high grade-- potentially containing millions of ounce of silver--and they extended for some 10 kilometers. As well, they were located at or close to the surface and silver was then trading at $30 an ounce. Puma drilled 36 holes to a maximum depth of 250 meters between 2006 and 2008 in order to define the resource. Their objective was to put it into production as quickly as possible.
"It was so rich at the surface that our former president said let's drill this thoroughly to make sure we have enough resources to put it into production and start generating cash flow," recalls Robillard.
At that point, there were two schools of thought among the management group. Robillard says he and several others believed that there was a lot more mineral wealth to be discovered and wanted to take stock of the entire property. The financial crisis of 2008 and 2009 hit the junior mining sector with a real thud. Raising exploration money became extremely difficult and Puma reduced exploration on the Nicholas-Denys property.
Since then, however, the company has embarked on a comprehensive exploration program that involved geophysical surveys, trenching and drilling. Puma drilled 84 holes into the Haché-Shaft zone over a strike length of 700 meters, which represents less than one-tenth of the structure. Most went to a depth of 450 meters, though one went down 1,200 meters and the company amassed 20,000 meters of core samples that revealed five new mineralized zones.
"Everything that we find is right at the surface," says Robillard. "We don't talk about going deeper--to 400 or 500 meters--before hitting the zone. It's right there. We just remove the grass and a few feet of soil and overburden and its right there."
In 2012, the company shifted its exploration program to a massive granitic structure with classic porphyry textures, which Robillard and his team believe is the motherlode of the whole system. This circular structure is four kilometers in diameter, which makes it very large by world standards. Based on trenching and drilling done to date, Robillard says he and his team are confident that they have a high tonnage copper and molybdenum deposit.
The company drilled three reconnaissance holes into the porphyry prior to this year simply to prove that it contains copper. Robillard says this year's exploration budget includes a total of 12 to 16 holes. The first three holes of this year's program intersected economic grades over hundreds of meters of drill core. "We now know the porphyry is fertile with combined economic grades of copper, molybdenum and silver," he says. "The remaining 2014 holes are specifically located on similar targets." Robillard and his colleagues believe that their Nicholas-Denys property may contain enough mineral wealth to support not one, but several mines. "We know we have the minerals," says Robillard. "We know we have the grade. Now we need to define the resource. We need to prove the size. It is an exciting challenge."
When Robillard was asked the obvious question, about the likelihood of a takeout offer for the company or the project, he replied that the possibility seemed to increase with each drill hole. He reflected that it was probably inevitable at some point and that Puma management would act in the best interest of all shareholders. "After all our management and directors are also shareholders, including myself," he concluded.
Puma trades at $0.21 with a market cap of $19.5 million.
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