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   Argentex Mine, Patagonia


Argentex Mine - 2008 January

Montevideo and Buenos Aires
Montevideo and Buenos Aires
It was supposed to be a two-day visit to Buenos Aires, Argentina. Just a hop from Montevideo, Uruguay across the Rio Plata, the river separating the two capitol cities. Gregg and I would carry one of the airplane instruments to get it repaired in Buenos Aires (BA), and have dinner with an old friend, Bob Moriarty.
Bob was in BA to meet up with Argentex president Ken Hicks, as were other folks including Cal Everett and Greg McCoach, to visit one of the Argentex (OTCBB Stock Symbol: AGXM) mining properties in southern Argentina. "Why don't you come out and write an article on the Argentex property?" Bob asked. Bob cleared it with Ken, and suddenly our two-day stop extended into the week-end, a whirlwind of travel with a dozen neat people.
I can spell "quartz" but the only mines I had seen before this trip were abandoned open pits that our group had skirted while horseback riding in the southwestern USA, and an old mica mine that I had passed on a hike in the same region, where shards of mica still shimmered on the ground. I was green as can be, but fortunately the rest of the group visiting the Argentex Pinguino ("penguin") property were quite knowledgeable and happy to answer questions.
Bob in BA
all smiles with Bob in BA
all smiles in BA
Pinguino is located in the Santa Cruz province, the southernmost province of Argentina apart from the little tip of South America which is the Tierra del Fuego province. You may have heard of Santa Cruz in 1991, when the Hudson volcano, west of Argentina in southern Chile, erupted. The skies in Santa Cruz were darkened for two days. Poisonous ash travelled as far as the southern Atlantic Ocean, and blanketed the ground in parts of the Santa Cruz province, killing wild animals and an estimated one third of the local sheep herds.
More than fifteen years later in spite of the at times howling winds, you can still find traces of ash in the scrubby vegetation. But as we bounced along the camino we spotted lama, ostrich, wild horses, armadillo and even skunk. We had flown from Buenos Aires to Santa Cruz to see the Pinguino property, and we were travelling the last hour of our ten-hour trip by four-wheel drive.
site visit
site visit
An oil company had been on the site previously, and had run seismic lines, creating very straight dirt roads that we now used to go between several sites. As the sun rose and the earth heated up, the wind picked up to the point that on the last three site visits strong gusts occasionally made it hard to remain standing. Hats went flying on a several stops, and the trucks were parked into the wind at each stop like heaving-to in a sailboat, so the doors wouldn't get ripped off when we opened them. Argentex is considering harnessing the wind to provide power at the site, and it makes good sense considering the current oil prices.
After visiting ten different sites within the Pinguino property we returned to Campamento Piche ("Camp Armadillo"), the base camp. I was happy to find that I had not actually lost my hearing while in the field, although the wind had made me think so, but my lips were dry and chapped and my skin wind- and sun-burnt though I had worn a hat. It was easy to imagine how brutal winter would be, and hard to imagine the drill workers and geologists laboring in this weather. in the trench, again
in the trench, again
And yet worked they had, taking thousands of soil samples from existing trenches, performing geophysical tests over 40 kilometers, and drilling 10,000 meters of sample core since 2004. Other mining companies had been on the site before, but Argentex is the first to carry out a detailed mapping program using satellite images, soil samples, core samples, and electric current tests to produce a comprehensive map.
The previous day in Buenos Aires, president Ken Hicks and technical advisor Diego Guido had given a presentation to the group, with enough information to make my head spin. Both exuded optimism as they described the property, alternating in the hot seat and handling questions confidently and without hesitation. Two clearly valuable Argentex folks were also present; one of the three directors, Jenna Hardy, and another company advisor, Patrick Downey.
site visit
driving to next site
The Santa Cruz properties encompass 202,000 acres (81,000 hectares), representing in land mass just 5% of the properties held by Argentex. Pinguino is one of the Santa Cruz properties. The land is flat with few hills and low green-grey vegetation and rocks. In the past there was some sheep farming, but today there are only abandoned buildings and the Argentex camp site. There are very few trees. Water for the drill has to be trucked to the site, a task that has been assigned to the drill equipment contractor.

In April-May 2006, they drilled the first pozos (exploratory holes) in Marta Centro, a site within Pinguino, revealing large deposits with several metals. Since then they have drilled 10,000 meters, and plan to continue drilling until the end of of the summer season in Patagonia, which is April/May 2008. That means they will get the results in October/November this year to improve the map of the property. Which means they could start mining as early as 2009.
Santa Cruz landscape
Santa Cruz landscape
At this point they are still determining how much they have, but it looks promising, with several significant deposits. They have found nearly 60 km of veins. All drilled holes to date have hit some combination of precious metals (Gold, Silver), base metals (Lead, Zinc, Copper), and Indium. There is a very good Silver vein at Marta Norte.
The most interesting part is that this is the first indium-rich discovery in Patagonia. Indium is a soft, silvery-white metal used primarily in liquid crystal displays (LCDs), which are used for cell phones, computer screens and high-definition TVs. Indium is also used in LEDs, laser diodes and a new breed of thin-film solar panels.
There are six countries currently exporting indium including China, which accounts for more than 30% of the global indium production. Worldwide production is currently over 1,000 tons per year, a little less than half from from mining, and the remainder from recycling. The price shot from US$94/kg in 2002 to over $1,000/kg in 2005.
140 grams per ton is the average grade of the best indium mine in history, Toyoha, in Japan. This mine is now closed, and other mines produce a maximum of 50g/ton. Penguino appears to promise an average of more than 50 grams per ton.
removing the sample
removing the core sample
We watched the guys run the drill for a few minutes, and watched a worker remove the core from the tube. We visited several named work sites at Pinguino: we reviewed cores from drill holes at Marta Norte, Marta Noroeste, and Marta Centro; trenches at Kasia, Ivonne, and Ivonne Sur; and we stopped to see the Tranquilo Fault, a geological feature the Argentex folks believe to be key in the formation of deposits. At our arrival to the base camp, before we headed out to the field, we had reviewed a sample in its entirety, laid out on tables for inspection and logging.
The process of analyzing core samples is pretty straight-forward. The company needs to know how much of which minerals are in the sample, and how to extract the good stuff. Each bar is three meters long. All pieces greater than 10 centimeters are measured for quantity of deposit, and inspected for faults, or breaks. This information is entered in a database. Then the sections are cut in half, one half being labeled and stored, and the other shipped off for assays - tests which determine how much of which minerals are in the sample. If the sample is interesting enough, metallurgic tests can then tell how best to extract the minerals from that particular type of kind of sample. core sample
core sample in box at camp
There are currently thirty-five people working on site including equipment operators, geologists, assistants to the geologists, and camp staff. Once they start mining the project could employ as many as 600 people. Argentex has an agreement with the National University of La Plata, so several geology students (Mariano, Conrado, Paula and Hector) were on site as assistants to the geologists. During the winter season Mariano and Conrado do analysis and other desk work while studying in La Plata. The equipment operators are hired by the company that owns the drilling equipment. We were driven into the camp by Orlando, an equipment operator from a northwestern city in Argentina, whose wife is expecting a son in two weeks. The camp staff are hired locally, and there is a mensual, a man that lives on the property year-round, who keeps some sheep and horses.
lunch at Campamento Piche
Back at Campamento Piche lamb, steak and sausage were waiting, along with fresh green salad, potato salad, bread, and a choice of desserts including tiramisu and fruit salad. Although this was a dry camp, the table was set for the occasion with bottles of red wine. Small scrubby trees and the camp tents kept the wind from ripping through as it had in the field, but sand was still blown onto the table from time to time. Or maybe it was just falling out of my hair and clothes.
Talk fell to wine, soccer and fruit trees. Four hours of peppering the Argentex team with questions, and reviewing core samples and surface structures seemed to have satisfied everyone. Exploration at Pinguino has yielded exciting results and promises more of the same. Detailed information is on the Argentex web site: