470/December 6, 1996 INVESTOR’S DIGEST Issue 23/96

GEORGE WERNIUK

Samex hunting ‘elephants’ in Bolivia

Eight properties in southwest Bolivia could produce gold, silver and base metals from bulk tonnages of low grade ore.

The Canadian mineral exploration business has undergone a dramatic change over the last couple of years. There has been a flood of new companies, old companies under new names, almost unlimited funds for exploration, and expansion to almost every corner of the globe.

Samex Mining Corp. (SXG-VSE, $1.95 phone 1-800-828-1488) has undergone a corporate metamorphosis and jumped on the global bandwagon.

Originally known as Paragon Resources Ltd., its name changed to Samex in September 1995 as its focus changed from oil, gas and uranium in western Canada to gold and base metals in Bolivia.

Samex has assembled a portfolio of properties, some of which may host "elephant" deposits. The properties with the best potential are getting the initial exploration dollars. Work so far has been encouraging, but will require a lot more exploration.

Samex has financed its work by private placements without any problems. A full evaluation of the properties will take time, so it’s a speculative buy for the long term. But individual drill holes could move share prices up quickly, a plus for short term speculators.

Samex’s Bolivian land package was put together beginning in 1993 when a private company, South American Mining and Exploration, assembled a team of professionals from North and South America with expertise in exploration, mining, finance and public company management.

This team examined more than 100 mineral prospects, and acquired and explored several mineral properties in Bolivia before the current flurry of exploration activity in that country. Before its acquisition by Samex, South American Mining and Exploration had raised $2 million to fund its activities.

Today Samex has eight properties, all in southwestern Bolivia, with the potential to produce gold, silver and base metals from bulk tonnages of low grade ore. Three properties are being explored or have been worked on this year.

Santa Isabel is a 4,854 hectare property on which a seven hole reconnaissance drill program was completed this year.

One hole was mineralized along its full 339.5 metre length, grading an average of 1.64 per cent zinc. Two other holes also hit economic mineralized zones. The results suggest that Santa Isabel hosts a large polymetallic system similar to the deposits at Butte, Montana and Bingham, Utah.

The richness of the Butte deposit is illustrated by the fact that it has produced over the last 130 years, more than 20 billion pounds of copper, five billion pounds of zinc, 3.7 billion pounds of manganese, 855 million pound of lead, 800 million ounces of silver, three million ounces of gold and significant quantities of other metals.

Samex’s geological staff has visited the Butte deposit as part of a study to guide the reconnaissance drilling at Santa Isabel.

Drilling to date has tested only a small part of Santa Isabel; further drilling is under way in search of the system’s mineralized core.

The Walter property, also in southwestern Bolivia, covers 13 kilometres of strike length along a regional trend of gold, silver and base metal mineralization. The deposit was found in the early 1990s and explored by the previous owners. Underground drifting defined ore reserves of 323,000 tonnes along a 200-metre deep portion in the two kilometre Walter South-Central zone.

A program of underground sampling, road building, trenching and drilling started earlier this year on the Walter property to delineate further reserves and provide bulk samples for bench testing the ore. The work has intersected a series of new mineralized veins.

The Walter property has excellent potential to host a large tonnage gold-polymetallic deposit.

The Yarenti gold and antimony project, also in southwest Bolivia, has sedimentary rock-hosted gold that was discovered earlier in the year. The drill program was completed in June, with several holes intersecting stratabound mineralization. Due to the complicated geology of the host rock layers, the company will focus its attention on other properties for the time being.

Work in the new year will consist of geophysical surveys on the Santa Isabel, Wara Wara, Agua De Castilla, and the Escapa properties. Geophysics at Escapa will begin in January.