March 16, 2016 – Vancouver, British Columbia – Gainey Capital Corp. (TSXV: GNC) (OTCQX: GNYPF) (“Gainey” or the “Company”) is pleased to provide an update regarding important progress on the Company’s exploration activities at its highly acclaimed, 192-km2 El Colomo property located in the Sierra Madre Occidental Trend in Western Mexico and mineral-processing at its fully operational, 300-tpd processing centre located in Huajicori, Mexico. Gainey has maintained a low monthly burn rate over the past 24-months while gold prices have dropped as low as USD$1050/oz. this year. Gainey continues to be a strong exploration and mineral-processing company and has continued to find significant opportunity during the difficult precious metals market over the past several years.
Exploration Program: Gainey reported positive results from its initial mapping and sampling programs at El Colomo, which showed high-grade gold and silver from mineralized structural zones as well as lower grade mineralization with potential bulk tonnage in the host wall rock.
Gainey discovered a new high-grade mineral zone at El Colomo that carries a vein structure of 4 to 7 km in length, which may be the northern extension of an area of known mineralization called the “Golden Corridor.” Analytical results from the structure include 24.50-gpt gold / 1,300.00-gpt silver. The Company will begin detailed mapping of this particular mineralized zone and will announce details as the program is finalized.
Drill Program: Results from Gainey’s mapping and sampling programs have helped to identify priority drill targets for Gainey’s Phase 1 drill program that is to commence Q2 2016. 5 high-priority mineralized zones have been identified at El Colomo and Gainey plans on drilling between 2,200 to 5,800 meters in these areas this year.
Gainey’s renowned geologists: Larry Segerstrom, Director and QP of Gainey, and Rafael Gallardo, Senior Geologist of Minera Cascabel S.A. de C.V. (“Cascabel”), have signed-off on 21 priority drill targets totalling 5,800 meters, which could be divided into various tranches. These targets are within mineralized zones at El Colomo, which include:
- La Higuerita, with highlight assays of 33.30-gpt gold / 1,550.00-gpt silver and 20.00-gpt gold / 895.00-gpt silver;
- La Nueva Victoria, with highlight assays of 9.73-gpt gold / 155.00-gpt silver and 3.54-gpt gold / 261.70-gpt silver;
- El Arrayan, with highlight assays of 12.35-gpt gold / 938.00-gpt silver and 2.68-gpt gold / 248.10-gpt silver;
- La Peñita, with highlight assays of 24.50-gpt gold / 1,300.00-gpt silver and 2.36-gpt gold / 138.30-gpt silver; and,
Detailed highlights from Gainey’s sampling program can be found here: GAINEY SAMPLES UP TO 33.30 GPT GOLD AND 1,550 GPT SILVER AT THE ‘GOLDEN CORRIDOR’
Drilling Companies: Gainey is in negotiations with several successful drilling companies that have extensive experience with the geological structures that are prominent throughout Gainey’s El Colomo property. Gainey plans to engage a drilling team within the next 30 days in order to devise and begin executing a strategic drilling program.
Mineral Processing: Gainey continues to grow its operations at it’s wholly owned, 300-tpd processing centre. The Company will continue to sample and process mineralized materials for local mining groups like: Goldplay, Nayarit Mining, El Escobar, etc. The 50/50 profit-sharing agreements between Gainey and these groups offer the potential for near-term revenues. Profits received by Gainey will be used to supplement the Company’s exploration and drilling programs. Gainey will continue to look for more sampling and processing opportunities while the precious metals market recovers.
In addition, Gainey plans on sampling its own mineralized material from its El Colomo property by Q2 2016, which could offer ongoing revenues to fund future exploration and development initiatives.
Corporate Development: The recent surge in gold and silver prices has attracted significant interest from prominent mining and investment groups. These groups have visited Gainey’s El Colomo property for the following reasons:
- 192-km2 land package in a potentially high, gold and silver, mineralized zone;
- Significant assay results from detailed sampling program (noted above);
- Strong working agreement with the local Indian communities;
- No security issues in this region of Mexico; and,
- Infrastructure in place (water, power, labour force, roads, etc.)
Ocean Partners: Gainey has been working with Ocean Partners on an Off-Take Agreement (the “Agreement”) for the purchase of Gainey’s concentrate. Gainey will announce the terms of this Agreement in the near future. Ocean Partners of Connecticut, USA offers a complete range of trading services for miners, smelters, refiners and metal consumers around the world and provides numerous off-take agreements for some of the largest mining companies in Mexico, making them a very strategic group for Gainey to partner with.
David Coburn, CEO of Gainey, commented, “We’re pleased to announce that Gainey continues to find great opportunities at its El Colomo property despite the difficult precious metals market over the last several years. Gainey has taken full advantage of the current market conditions to develop a competitive and extensive drill program with some of the most renowned drilling companies in mining and exploration. Local communities, as well as local and federal governments throughout Mexico, have exhibited profound support in expediting Gainey’s exploration activities. Gainey remains to be a prominent exploration and mineral-processing company with a solid reputation in Mexico. We continue to move our projects forward in the most strategic and cost-effective manner and will continue to consistently create long-term shareholder value for many years to come.”