Luca Mining (TSXV: LUCA) is reporting high-grade gold mineralization below existing workings that could expand the resource and output at its Tahuehueto mine in Mexico.
Drill hole DDH26-SU-01 cut 7.6 metres grading 14.27 grams gold per tonne, 46.64 grams silver, 0.33% copper, 2.57% lead and 1.19% zinc from 80.9 metres depth. Drill hole DDH26-SU-03 returned 13.2 metres grading 6.66 grams gold, 17.18 grams silver, 0.04% copper, 0.25% lead and 0.65% zinc from 42.7 metres downhole.
“Luca continues to realize positive success with the drill bit and is intersecting high-grade intercepts of mineralization along the Creston vein system at multiples greater than current head grades (about 4 grams gold-equivalent),” Canaccord Genuity mining analyst Phil Kerr said in a note on Friday.
“Furthermore, today’s new highlight drill holes come from just 30 metres below Level 23, which hosts established underground infrastructure.”
The drilling comes after gold prices surged about 65% last year and spurred investor interest in producers with room to grow high-grade resources close to existing infrastructure. Mexico’s mining policy shifts in recent years, including a halt to new mining concessions and tighter federal oversight of the sector, have made expanding resources around existing operations increasingly important for companies operating in the country.
2025 start
Shares in Luca Mining fell 0.3% to C$1.72 apiece on Friday in Toronto, valuing the company at C$471 million ($346 million).
Tahuehueto, in the north-central state of Durango and part of the Sierra Madre Occidental mining belt, has had a long development history through several owners. Luca completed construction of its 1,000-tonne-per-day mill and brought the underground mine into commercial production in 2025. Tahuehueto is about 1,165 northwest of Mexico City.
The underground operation targets gold-silver mineralization with copper, lead and zinc credits hosted in epithermal vein systems across the district.
“We see the ongoing exploration success validating Luca’s geologic model,” Kerr said. “[It] supports mine life sustainability through resource growth, and proximity to existing underground infrastructure suggests an opportunity to work new zones into the operation’s near term mine plan.”
Exploration increase
Luca’s board has approved a 40% increase, $1 million, to the 2026 exploration budget at Tahuehueto, which now totals $3.5 million. The company has identified 14 prospective vein targets. So far it has completed 28 underground drill holes totalling about 6,750 metres and 19 surface holes for roughly 3,650 metres across the Creston vein and nearby Santiago targets as part of this year’s program.
The assays released support an interpretation that high-grade mineralization occurs in brecciated quartz-sulphide veins within the Creston structure and remains open down plunge, the company said.
“The results validate our Tahuehueto geological model and highlight the opportunity to expand high-grade mineral resources within development distance of existing infrastructure,” Paul D. Gray, Luca’s vice-president of exploration, said in a release.
“With both underground and surface rigs active, and an expanded drill budget, we are well positioned to continue defining high-grade mineralization and demonstrating the broader scale of the Tahuehueto system.”
