PROJECTS / Oro Polymetallic Project, New Mexico

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The 6.9 sq. km Oro Project comprises eight patented mining claims and 89 BLM mineral claims which cover the majority of the historic Eureka Mining District in Grant County, New Mexico and is located approximately 40 km SW of the Silver City porphyry copper district.

The Oro claims overlie a large Larimide-age, intrusive-related gold, silver and base metal center located in the Little Hatchet Mountains. The company has identified multiple prospective drill targets throughout a 2 kilometre long mineralized corridor largely untested by modern exploration.

Initial exploration on the project included geological mapping, surface sampling and a five-hole, 1645 metre diamond drill program, conducted over a nine month period in 2009-10. This work identified the exploration potential for three deposit types at Oro, recommendations for IP geophysics to assist drill targeting and a minimum of six core holes to test these additional targets.

Southern Silver’s work on the project to date has identified strong surface alteration and distinct geochemical zoning in rock and bio-geochemical samples throughout the property. Anomalous gold, base-metals and arsenic occur in association with intervals, often tens of metres thick, of silicification, pyritic sulphides, and variable skarn alteration and hornfels in two of the five Phase I core holes which tested the property.

History

In 1877, the discovery of lead, copper, and silver created the Eureka Mining District. By 1880, several high-grade base and precious metal mines were in operation in the district, but were mined sporadically due to hostile local inhabitants and fluctuating silver prices.

Production began at the Oro Project shortly after the discovery of lead, silver, and copper in 1877 and continued sporadically through the early 1960’s. The New Mexico Bureau of Mines estimates production from the Eureka District between 1880 and 1961 at 2.9 million pounds of lead, 1.7 million pounds of zinc, 0.5 million pounds of copper, 0.45 million ounces of silver and 5,000 ounces of gold. Reported grades are in the range of 20 oz/ton (685 g/t) Ag, 4% combined Zn and Pb, and up to 0.04 oz/ton (1.4g/t) Au. Smaller amounts of high grade mineralization were reported to have assayed up to 5.5% Cu and 840 oz/ton Ag.

The early phase of mining in the Eureka Mining District lasted until the 1920s, when a decrease in metal prices made the mines uneconomic. Limited work has been done in the region since then, with the most recent records of exploration and mining dating to the early 1960s. Historical records indicate that low metal prices were again responsible for the cessation of mining activity in the area in 1960, and that untested targets remain in the vicinity of the old mine workings, particularly at the American Mine, now part of the Oro claim group. Commenting on the New Mexico project, Lawrence Page, president, said, “The presence of historical base and precious metal mines from the late 19th and early 20th centuries, coupled with a relative lack of modern exploration in the area, make the Oro Project an exciting potential location of future discovery”.

The Oro Project hosts a 2+ kilometre NW-trending long structural corridor with intrusion-related disseminated gold. Carbonate-replacement and vein hosted Pb+Zn+Ag+Au as well as high grade precious metals along NE-trending cross structures.