Overview
Malbex is exploring for gold in Argentina (2 projects) and Peru (1 project). The Company's two Argentinean projects are Del Carmen and Despoblados. Del Carmen is the flagship project, with an initial NI 43-101 compliant inferred resource on the Rojo Grande gold-silver oxide discovery of 25.4 million tonnes grading 1.00 g/t gold and 13.3 g/t silver for 816,600 ounces of contained gold and 10.9 million ounces of contained silver. Malbex is budgeting approximately $8 million for the 2011/2012 field season at Del Carmen, including drilling, geophysics, phase 2 metallurgical testing and other exploration activities. In Peru, Malbex is budgeting approximately $0.6 million for the earlier stage Grace project.
The Argentina properties are located in pro-mining San Juan province in the northwest of the country and encompass a total of 18,730 hectares (Del Carmen accounts for 15,129 hectares). There is excellent access to the properties, which are 4-5 hours drive from San Juan City in the prolific El Indio Gold Belt. The Belt contains more than 35 million ounces of gold in past production and current reserves in just three mines, including Barrick's Veladero and Pascua-Lama deposits. In 2010, Veladero produced 1.12 million ounces of gold at total cash costs of US$256.
Malbex holds a 100% interest in these properties through agreements with the Instituto Provincial de Exploraciones y Explotaciones Mineral (IPEEM), an arm's length agency of the San Juan provincial government. The 5 1/2 -year agreements run from September 2008, and are convertible into 30-year renewable exploitation licenses with a 3% royalty to the province and a 2% royalty to IPEEM.
San Juan is the most pro-mining jurisdiction in Argentina, as demonstrated by the commissioning of the Veladero (Barrick), Gualcamayo (Yamana) and Casposo (Troy Resources) mines in recent years and approval for the construction of the Pascua-Lama mine (Barrick).
