The Pachi project comprises a single 100 sq km cateo (exploration licence) located in the central-western Deseado Massif of Santa Cruz Province, Argentina.  The property lies less than 15km SE of Hunt Mining Corporation’s La Josephina deposits (125,000oz Au and 1.7Moz Ag) and just 5km south of Hunt’s El Gateado prospect. Provincial road Route 12 passes through the property, providing excellent access.

An important feature at Pachi is a silica-carbonate sinter horizon that sub-crops over 800 metres strike on the property.  Previous rock chip sampling of this horizon has returned up to 0.29g/t Au (with 58.7g/t Ag) and 68g/t Ag.

De Grey personnel visited the site in February 2011 and took several spot rock chip samples from outcrops of the sinter horizon.  Several of those samples returned elevated levels of mercury (to 5000ppb), arsenic and manganese, demonstrating that the sinter represents the fossil outflow zone of an epithermal system that carried significant metals.  More detailed sampling and mapping is expected to reveal vectors to the source hydrothermal feeder structure, a prime drill target for high-grade epithermal Au-Ag mineralisation.

Silica-carbonate sinter outcrop, Pachi

Pachi is held by an individual Argentine citizen with whom DEGA has a three year option to purchase agreement.  First year option payment is US$24,200, second year US$60,500, third year US$121,000.  De Grey is able to purchase the property at any time during the option period for cash payment of US$1,210,000 plus 1%NSR.  De Grey is also required to complete 500 metres of drilling in the first year provided that all required permits are achieved.

De Grey has scheduled detailed geological mapping and sampling to commence at Pachi as early as possible in the upcoming field season, expected mid-September 2011, with a view to drilling in early 2012.