On Dec 15, 2010, NWM Mining Corporation (TSXV: NWM) (CVE: NWM) announced additional results from the RC drilling program at the Company’s wholly owned Lluvia-Jojoba project, located in northern Sonora, Mexico.
The Phase 2 RC drilling concentrated on “Area 7 Pit”, the farthest northeast of three production pits to the northeast of the Creston Pit. Drill hole R10-031 returned 59.4 meters of 0.737 g/t Au with a strong intercept of 7.6 meters grading 3.07 g/t Au, and hole R10-033, located 63 meters northeast, returned 1.054 g/t Au over 27.7 meters. Holes R10-024, 026, 027, 028, 031, 032, and 033 indicate that the northern and western margin of the pit is open and that additional drilling is needed to establish the economic edge of the Area 7 Pit.
To learn more about NWM Mining Corporation, see our research reports on NWM available at http://www.smallcappower.com/microsite/nwm_mining_corp_research_reports.html
To view our video interview with Mr. Chris Berlet, CEO of NWM Mining Corp visit http://www.smallcappower.com/microsite/nwm_mining_corp_videos.html
NWM Mining Corp has calculated a reserve of 384,361 ounces Au using 12,500 metres of historical drilling. This reserve was calculated using a 0.2 g/ton cut off grade, a $900 per ounce of gold price and 51° Pit Slopes. These new drill results released on Dec 15th are expanding the defined gold mineralization in the vicinity of the Area 7 pit. These results and the previously released drill results give strong indication that the next reserve update by NWM Mining (which we believe will happen in 1st half of 2011) will result in a meaningful increase in the proven plus probable reserve estimate.
NWM is on the verge of becoming a gold producer and on Dec 14th 2010 they announced the appointment of a strong operating team set to ramp up production. Ubika Research believes NWM will produce over 18,000 ounces of gold in 2011 with a potential to double this production in 2012.
While NWM is ramping up its production, it is also implementing an aggressive exploration program for 2011. The company has significantly improved the understanding of the geology in the Lluvia and La Jojoba properties and has identified 7 new exploration targets in Lluvia and 4 new targets in La Jojoba. The Lu Lluvia exploration target includes a major fault zone which shows signs of copper gold mineralization and could extend four kilometres to the northern part of the La Jojoba Northeast zone. Exploration targets for La Jojoba include the large areas of multi-element soill geochemical anomalies identified in the Campamento Zone in 2006. Any material assay results in the fault zone or Campamento Zone could be significant for the resource potential in this property.
NWM Mining Corporation is based in Sonora State, Mexico and is in the same neighbourhood as Capital Gold Corp (TSX: CGC, AMEX: CGC). Recently Gammon Gold Inc (TSX: GAM) (NYSE: GRS) has made a $288 million takeover bid to acquire Capital Gold Corp (TSX: CGC) (AMEX: CGC). Earlier Timmins Gold Corp (TSXV: TMM) (CVE:TMM) also based in Sonora State, had tried to acquire Capital Gold Corp (TSX: CGC) (TSE: CGC). It seems Timmins Gold Corp will be unsuccessful in acquiring Capital Gold Corp. This should portend well for NWM as it is expected to produce under 20,000 ounces of gold starting in 2011 and a likely takeover target. Sonora State also hosts the biggest gold mine in Mexico, La Herradura, which is operated as a joint venture between Newmont Mining Corporation (NYSE:NEM) and Mexican mining conglomerate Industrias Penoles SA de CV.
The company now has in place a $16 Million standby credit line. The company has already produced more than 2,000 ounces of gold from ore, which had been left on the pad, and has invested more than $21 million in the project to date. The investment has resulted in fully commissioned gold and copper recovery circuits. The company has all the permits required to start production, commissioned SART and ADR plants and the capital required to start commercial mining operations. NWM is aiming to produce 20,000 ounces of gold in 2011.
Disclosure: Ubika Research & Smallcappower.com has received compensation from NWM Mining Corporation for providing analyst research coverage and capital market exposure service.
Except for the historical information presented herein, matters discussed in this document contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements.
Ubika Research and www.smallcappower.com (are both divisions of Ubika Corporation), and are not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this report. For making specific investment decisions, readers should seek their own advice. For full disclosure please visit: http://smallcappower.com/disclosure.aspx