Mercedes: Geology and Minerals

Mineralization
There are several deposits of precious and base metals within the surrounding area of the Mercedes Property. The Mulatos deposit (gold) is located some 40 kilometers to the NE. The Santa Ana deposit (copper and silver) is located some 13 kilometers to the SW. The La Trinidad deposit (silver) is located some 15 kilometers to the NE. It is also quite common to find within the surrounding area some small pits and adits that were exploited for their tungsten content.

The Mercedes deposit (gold and silver) is mostly comprised of a brecciated and sheared porphyritic intrusive (QFP) in contact with andesitic flows and tuffs. The mineralization can be classified has being of hydrothermal type, comprised of quartz stringers and veinlets and also of crystallized open space filling type. There seems to be a close relation between the quartz and the deposition of gold, especially within the silicified zones. There also seems to be more gold within the oxidized zone than the sulphide zone where in both cases the main sulphides that are present are fine grained disseminated pyrite with minor amounts of arsenopyrite. The oxidized zone is believed to be approximately 50 meters thick, whereas the orebody is approximately 35 meters thick, 85 meters wide and has been defined to date to be some 80 meters long, although the inferred length of this orebody could extend to as much as 200 meters in strike length.

The main control on the mineralization is structural, through faults (thrust faults, normal faults and reverse faults) and shear zones. To the SW of the Mercedes orebody there is a fault showing a general trend of N325° with a 75° dip to the NE. This fault marks the contact between the QFP and the andesites. 110 meters NE of that previously mentioned fault, there is another fault oriented N310° and dipping 75° to the SW. On the northwestern edge of the deposit the contact between the QFP and the andesites has been determined to be N030°. The most northeastern portion of the orebody is comprised of numerous intersections of faults showing variable orientations which have provoked an intense shearing pattern which enabled the hydrothermal fluids to circulate and thus carry the precious metals within the deposit.

Hydrothermal Alteration
Alteration patterns exhibit a zonation from the centre of the ore body as being of phyllic type (quartz and sericite), grading into an argilitic type (kaolin and sericite) at the contacts or limits of the orebody and then into a propylitic (chlorite-epidote) type as one moves further away from the orebody and well within the andesites. There is some tourmaline alteration near the extreme NE corner of the orebody but it doesn’t seem to have any implication or association with the deposition of gold. As far as the iron oxides are concerned they are mostly altered into limonite and hematite. Where this latter type of alteration is strong there seems to be less gold, whereas if it is weak to moderate there are better chances of finding gold.

Local Geology
The local geology of the Property is mostly underlain by aphanitic to locally porphyritic textured andesites which show a grey to pistachio green colour on weathered and/or fresh surfaces. The dominant alteration is propylitic (and epidote). The contact of this unit with the quartz-feldspar porphyry (QFP) is strongly brecciated. The intrusive (QFP) is light grey in colour and weakly to moderately silicified. It is often crosscut by andesitic dikes. The dominant alteration within this unit chlorite is phyllic in composition (quartz and sericite), especially at the contacts with the andesites. Overlying the above mentioned units is a volcanic complex of Upper Tertiary Age which is divided into 2 separate units: the lower volcanics mostly comprised of andesites and dacites and the Upper volcanics mostly comprised of ignimbrites, breccias and agglomerates.

Structural Geology
The contact between the QFP and the andesites has a general trend oriented ENE (N050°) with a dip towards the SSE. This contact is in turn crosscut by shear zones and faults that are oriented NW-SE and exhibit a variable dip or plunge sometimes to the NE and at other times towards the SW. The contact between the Oxide Zone and the Sulphide Zone is trending NE-SW with a dip towards the SE (somewhat parallel to QFP/andesites contact).