Farallon continues to persevere over Hermiston in the courts winning in Canada, Nevada and Mexico. Hermiston has been assessed damages by the courts in both the Nevada and Mexico cases. At this point in time Farallon appears to unequivocally be the owner of the relevant mineral titles at Campo Morado and additional drilling is to be expected in 2002.
Farallon Resources Ltd. [FAN:TSE]
Contact: Scott Cousens
#1020 - 800 West Pender Street
Vancouver, B.C. V6C 2V6
PH: (604) 684-6365
FX: (604) 684-8092
Toll Free: 1-800-667-2114
Farallon Resources Ltd continues to obtain favorable results from its comprehensive exploration and development program at Campo Morado in Guerrero State, Mexico. Results confirm that a large gold- silver- copper- lead- zinc mining development is in the making. With 61,000 meters of drilling completed to date an entire district of precious metals-rich volcanogenic massive sulfide deposits is being developed.
Farallon is focusing on the drill delineation of the Reforma, Naranjo and La Suriana deposits areas where resources of around 30 million tonnes are being developed . Exploration drilling has begun in the San Rafael and La Lucha prospect areas. The Company’s road network is being extended south to the El Infierno and El Faison prospect areas in preparation for drilling.
Farallon’s Campo Morado Project activities have earned widespread local and governmental support. The Company is working with all government agencies and the local communities to ensure a well-planned, sustainable major mine development. All legal challenges made against Farallon regarding questions of ownership at Campo Morado have been settled in Farallon's favor, dropped or dismissed. The court case in British Colombia was ruled in FAN's favor (July, 1988). The court case in Nevada was ruled in Fan's favor with damages assessed to Hermiston (April, 1999). Ditto for Mexico (October, 2001) (The Old Prospector is happy that the legal nonsense is finally over. The Fat Lady is finally singing)
Latest Press Releases NOTE: FAN a stellar announcement 30Jun99 about three new precious metal-rich massive sulfide discoveries at their Campo Morado Project. As they said this demonstrates that exploration and development of the Campo Morado District is still in it's infancy. The company anticipates that current mineral resources can be expanded to the 50 million tonne range by systematic core drilling. (The Old Prospector thinks this district still has a lot of surprises to offer. At October 31, 2001 spot metal prices the "rock in the box" at Campo Morado is worth around USD $57.35/tonne. This would give the published resource an in-situ value around $1.663 billion USD, or slightly more than 5.9 million ounces of Au.)
October 26, 2001: Farallon Resources has received advice from its legal counsel in Mexico that the third federal district court of Hermosillo, Sonora state, Mexico, has ruled in favor of Farallon and the other defendants in the litigation initiated by David Hermiston. The court found Mr. Hermiston's allegations without merit and in addition awarded costs and expenses of the defendants against Mr. Hermiston. Legal counsel advises that the parties were informed of the ruling on Friday, Oct. 26, 2001. Ronald Thiessen stated: "While we are still in the process of translating and analyzing the court's decision we believe it represents a major step in ending the litigation respecting our 100-per-cent-owned Campo Morado copper-zinc-gold-silver property in Guerrero state, Mexico. With this issue behind us we can now move on to what Farallon has always intended to focus on, exploration and development of mineral resources. Having had to win lengthy court proceedings in Canada, the U.S. and Mexico has been a tremendous burden on Farallon shareholders but we believe that this is behind us now. Farallon can move on to demonstrate the substantial merits of the Campo Morado property and pursue potential development opportunities with those companies that expressed interest in Campo Morado prior to this litigation."
August 20, 2000: Farallon has maintained its drive to clear up all legal issues and plan for the restart of active site exploration on the 100 per cent owned Campo Morado precious metals rich massive sulphide district 160 km southwest of Mexico City in Guerrero State, Mexico. Farallon's exploration programs to date have delineated a resource estimate on two deposits and a partial estimate on two more amounting to 29 million tonnes of massive sulphides grading 0.69% Cu, 0.60% Pb,2.10% Zn, 89 gpt Ag and 1.57 gpt Au. This comprises one of the largest polymetallic mineral systems in Mexico and is located in the vicinity of a number of operating mines. For the mineral resources that have been identified, the company has completed the current phase of preliminary metallurgical studies and project operating and capital cost studies.
Farallon's ownership rights at Campo Morado have been challenged in three separate legal actions. The British Columbia Supreme Court trial was resolved in Farallon's favor on July 17, 1998, confirming Farallon's 100-per-cent title to the Campo Morado property. On April 28, 1999,
Farallon received a favorable decision in the United States District Court, District of Nevada, bringing to an end proceedings against Farallon in the United States. In Mexico, a lawsuit affecting Campo Morado, though not directly against Farallon, was before the Third District Court of Sonora. This case was finally settled October 26, 2001 with a judgment being issued favorable to Farallon. Damages were assessed against the Plaintiff in this Mexican civil case..
Farallon is confident of its legal position and expects to resume drilling at Campo Morado shortly after the final legal decision is reached. A comprehensive exploration program will resume to rapidly expand resource tonnages through systematic drilling of the El Rey, El Largo and Estrella de Oro deposits. It is targeted through delineation drilling of these deposits to increase the project's total massive sulphide resource to the 50 million tonne range. On Nov. 9, 1999, Farallon successfully acquired from the Mexican government in a public auction the 25-square-kilometre La Trinidad massive sulphide property located to the north of the Campo Morado property but forming part of the same mineral system. This property experienced historic mine production at the turn of the century, but is largely unexplored by modern methods except for limited aerial surveying, geochemical sampling and mapping, and a few holes that intersected massive sulphides.
Campo Morado precious metal-rich VMS district, Guerrero is located 160 km SW of Mexico City. Farallon earned a 100% interest in the property as of January, 1997.
STORY: Massive sulfide occurrences were first discovered in 1898. Mining and smelting of oxide ores grading on the order of 32 g/t gold began in 1903 and was interrupted in 1913 by the Mexican revolution. Sporadic mining occurred between 1920-1927 and during the period 1937-1940. No significant exploration work was carried out until 1973-1977 when a subsidiary of Union Oil rehabilitated 3.7 km of underground workings and drilled 840m of core from underground. Since then no significant exploration was undertaken until Farallon Resources implemented its intensive exploration program late in 1995. To the end of 1997 exploration has included 85 sq km of geological mapping, 51 sq km of detailed soil geochemistry, totaling 20,400 samples, 145 line km of gravity surveying and the drilling of 309 core holes totaling 61,000m. This work delineated the Reforma Deposit and has resulted in the discovery of four blind deposits. Preliminary engineering and feasibility studies are underway
GEOLOGY: Rocks in the Campo Morado District are part of the Lower Cretaceous Guerrero Oceanic arc terrane which was incorporated into a Late Cretaceous fold and thrust belt and subjected to regional metamorphism of sub-greenschist and greenschist facies. Several precious metal VMS deposits occur in a sequence of felsic to intermediate flows, tuffs and heterolithic fragmental rocks which lie between underlying limestones and overlying clastic sedimentary rocks. The Reforma and El Rey deposits are on the overturned limb of a major NE-directed recumbent anticline. The Naranjo and El Largo deposits are on the upright limb of the same fold and are associated with zones of strong footwall stringer copper mineralization. Further to the SW, the San Rafael and La Lucha occurrences contain smaller lenses of massive sulfide and footwall stringer zones. The recent G-( massive sulfide discovery 900m south of Naranjo is underlain by strong stringer Zn and Cu mineralization.
DEPOSITS: The massive sulfide deposits are dominated by pyrite with variable amounts of sphalerite, chalcopyrite and galena in a sparse gangue of quartz and ankerite. The Reforma deposit is zoned stratigraphically from a lower Cu-rich zone through a central pyrite-rich zone with overlying pyrite-sphalerite into an upper sphalerite-galena-arsenopyrite zone with significant values in precious metals. The other deposits show similar sulfide zoning. At present the Campo Morado District has a cumulative indicated resource of 30 million tonnes. Three deposits are open to expansion and several gravity anomalies in favorable settings remain to be tested. Engineering and metallurgical studies are underway on the Reforma and Naranjo deposits to determine their respective mineable reserves.
PDAC Core Display in March, 1998
Farallon's total land package over 278,100 ha (1,086 sq miles). Historic Cu-Au-Ag massive sulfide district with over more than 16 significant showings in hosted in Upper-Jurassic to mid-Cretaceous Teloloapan Subterrane rocks. Farallon has begun mine planning and related engineering, environmental and technical programs for resource development. This includes geotechnical drilling for rock stability studies etc which generated over 6000 lbs of material for metallurgical testing. Total cash operating costs are estimated at $25.75/tonne.
G-9 gravity anomaly. Farallon successfully drilled the one half kilometer south of the El Largo and Naranjo Deposits. This was a stand alone test of the gravity method as there are no surface showings, geochemical anomalies or alteration signatures to suggest the presence of massive sulphides in the G-9 area. (See Latest data on Farallon's website for details)
Reforma Deposit, historically the largest mined orebody, was 60 m thick and strikes NW and dips10-50 degrees SW. Stratigraphic continuity is reported as very good. Total drilling to date is well over 45,000m. Reforma was drilled on a series of fences 50m apart over 600m of strike and down-dip for 400m. Mineralization defined along 2,600ft of strike and down-dip some 1300 ft. Average intercepts at Reforma are around 22 ft thick at grades of 0.129 opt Au, 6.8 opt Ag, 0.56% Cu, and combined Pb+Zn of 6.3%. A separate unit averages 28 ft of 2.10% Cu and high Ag values.
El Rey Deposit, located around 1,000 feet SW of Reforma is being defined by drilling to be at least 1000 ft NS and 800 ft EW with an average intercept of 18.8 feet grading 0.105 opt Au, 4.86 opt Ag, 0.54% Cu, and 6.2% combined Pb+Zn. Gravity surveys in the El Rey area suggested the deposit was open to the south and east. This potential was substantiated when five out of six drill holes intersected significant massive sulphide mineralization as shown below:
Hole From To Internal Interval Au Au Ag Ag Cu Pb
No. (m) (m) (m) (ft) (oz/ton)(g/t)(oz/ton)(g/t) (%) (%)
97294 215.50 244.05 28.55 93.7 0.052 1.79 2.67 91.7 0.37 3.87
97295 280.40 286.40 6.00 19.7 0.010 0.33 0.84 28.7 0.47 3.36
97296 214.50 218.25 3.75 12.3 0.076 2.60 3.44 118.1 0.30 3.84
97297 201.65 208.65 7.00 23.0 0.005 0.17 1.47 50.4 1.55 0.33
97298 226.35 243.75 17.40 57.1 0.066 2.27 3.48 119.3 0.35 3.34
Naranjo Deposit. Announced new discovery of precious metal rich massive sulfide orebody on 6Dec96. Located around located 1.5 km S of Reforma. Not related to previous mining in area. Dimensions of NW striking, moderately SW dipping orebody are over 850 m long NS (2950 ft) and 800 ft EW with true thickness between 7m and 77m (23 to 253 ft) and is still open to E and W and downdip to S. Average thickness is 22.7 ft grading 0.094 opt Au, 4.36 opt Ag, 1.16% Cu, and 4.4% combined Pb+ Zn.
El Largo Deposit, located around 1,650 feet SW of Naranjo is being defined by drilling to be at least 800 ft NS and 1,650 ft EW with an average intercept of 33.7 feet grading 0.038 opt Au, 2.50 opt Ag, 1.52% Cu, and 3.0% combined Pb+Zn. In the El Largo Deposit area gravity surveys outlined potentially important extensions to the previously drilled mineralization. A bold step out 500 meters to the north of the known deposit in hole 97301 cut over 30 meters of massive sulphides. This and other holes in the extension outlined by gravity surveys are tabulated below:
Hole From To Internal Interval Au Au Ag Ag Cu & Pb
No. (m) (m) (m) (ft)(oz/ton)(g/t)(oz/ton)(g/t) (%) (%)
97301 90.65 121.10 30.45 99.9 0.055 1.88 1.50 51.4 0.63 1.78
97303 108.70 119.05 10.35 34.0 0.059 2.04 3.13 107.3 0.58 4.30
97304 190.90 194.25 3.35 11.0 0.052 1.78 1.38 47.2 1.07 0.54
233.50 235.40 1.90 6.2 0.012 0.42 1.41 48.2 0.29 3.94
246.75 264.83 18.08 59.3 0.025 0.86 4.02 137.8 0.38 8.88
97309 258.00 269.60 11.60 38.1 0.026 0.88 3.21 110.1 0.38 7.39
While the El Largo gravity extension areas have not been thoroughly and systematically drilled it is evident that important high grade zinc-rich zones (see holes 97304 and 97309) occur in this deposit.
La Suriana Deposit, located around 8 km S of Reforma has returned Au and Ag-rich massive sulfide intercepts over an area 400 ft NS and 2,300 ft EW with an average intercept of 13.9 feet grading 0.060 opt Au, 7.56 opt Ag, 0.54% Cu, and 3.9% combined Pb+Zn.
Estrella de Oro Discovery, A new 2.75m to 13.4 m mineralized horizon discovered west of El Largo in mid-1998.
Additional drill roads south of Reforma have been constructed to the San Raphael (2.5 km), and La Lucha (3 km) occurrences. Campaign of systematic drilling on Reforma, La Naranjo and La Suriana deposits continuing. Presently spending around $1.3 million/month on drilling, road-cutting and support services.
Land acquisition continues with the agreement to purchase from Minera Parral y Anexas and others a 100% interest in the La Suriana, Maria de los Angeles, Arcelia and Carmina concessions in the Campo Morado Project Area.
GCN #139 21Jul98
GCN #116 17Jun98 (New Estrella de Oro Discovery)
Press Release January 12, 1998
GCN #225 24Nov97
GCN #165 27Aug97 (Drill Hole Map and tabulated results)
GCN #112 11Jun97 (Map w/new discoveries)
LAMR April, 1997
NMN v83#8 04/21/97
NMN v83#6 04/07/97
GCN #58 24Mar97 (Nice set of figures, incl. plan maps of drilling)
MBD January, 1997
GCN #238 10Dec96
PointCast PR Newswire 6Dec96
NMN v82 #40 12/02/96
GCN #218 12Nov96
E&MJ November, 1996
GCN #172 5Sep96
NMN v82#28 09/09/96