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July 07, 2009
2nd Phase Drill Program Planned - Centauro Project, Chihuahua State, Mexico

Highlights
- 1,500 m drill contract in 5 to 6 drill holes to start late July / early August
- 2008 drilling intersected 1.93 g/t Au and 64 g/t Ag over 7.5 m in CEN-08-10 in wide zones (up to 92 m) of strongly anomalous gold/silver values
- Relogging / geological compilation has defined areas for Phase 2 drilling

July 7, 2009 - Bridgewater, NS - Silver Spruce Resources Inc. (TSXV: SSE) is pleased to update ongoing exploration on the Centauro, Mexico, gold-silver (Au/Ag) project. Results of 2008 drilling which drilled 3,960 metres in 14 holes (CEN-08-1 to 14) and tested the alteration zone over a 2.3 kilometre strike length and 1 kilometre width were reported in late 2008 and early 2009 (see news releases - Oct. 7 and Dec. 9, 2008 and Jan. 20, 2009).

The highlight from the 2008 drilling was a gold/silver intersection of 7.5 m at 1.93 g/t Au and 64 g/t Ag at the top of hole CEN-08-10, in a 92.1 metre zone, from 3 to 95.1 m, which assayed 237 ppb Au and 8.4 g/t Ag. The hole collared in mineralization so the full width of the intersection remains unknown as does its orientation and true width. Acanthite, a silver-bearing mineral, and native gold were identified (see news release Dec. 9, 2008). The closest drill hole CEN-08-11, which gave gold / silver values of 104 ppb Au and 2.0 g/t Ag over 20.5 m and 52 ppb Au and 2.9 g/t Ag over 23.5 m, is located 550 metres to the southeast and no drilling has tested the area to the north along strike. The gold / silver values are associated with the strong silicification in the silica breccia defined in the 2009 work. The mineralization / alteration appears to be dipping to the east / northeast, basinward and this is a prime area for further drill testing.

Work for 2009 to date consisted of relogging the 2008 core, geological mapping and field checking and geological compilation. This work has resulted in a better understanding of the geological setting of the alteration package and mineralized zones and has defined areas requiring further diamond drilling, which will be targeted in the 2009, 2nd phase program.

The Centauro property is dominated by a thick sequence of conglomerates with a calcareous mud to sand matrix, interbedded with calcareous siltstones and sandstones which dip moderately to the west (Figure 1). On Centauro hill, the silicified Mesa, the conglomerates are locally decalcified, silicified and brecciated. Based on field mapping and the 2008 drilling program, the alteration system is separated into three distinct packages: a) unaltered, basal calcareous conglomerate and associated calcareous sediments which outcrop to the west and north of the Centauro Mesa, and which, with the altered units following, comprised the original sedimentary sequence in the area. All 2008 drill holes intersect these units at depth suggesting the feeder for the alteration/silicification is not located directly beneath the Mesa; b) decalcified / weakly silicified, polymictic conglomerate altered through hydrothermal activity but containing clasts which are coherent and have similar lithologies and size as the calcareous conglomerates. These units are cut by kaolin veins (as secondary injection of kaolin) and show moderate argillic alteration. The contact between the basement conglomerates and the decalcified conglomerates is relatively sharp; and c) silicified breccias characterized by extreme silicification and brecciation of the original conglomerate. This unit is extremely resistant to erosion and outcrops along the top of the Centauro Mesa and to the east and northeast of the mesa. All units are crosscut by hornblende-bearing porphyritic diorites and andesitic subvolcanic units. The diorites are fresh to intensely altered and are crosscut by fresh andesites (displaying a defined chilled margin) which outcrop to the west of the Mesa. This suggests several episodes of igneous activity, both before and after epithermal / hydrothermal activity.

The plumbing system for the alteration on the Centauro Mesa appears to not be directly below the mesa, but may be located to the northeast for the following reasons: 1) poorly to unaltered calcareous conglomerate (basement) was intersected in all drill holes at depth; 2) silicification and alteration appear to dip shallowly to the northeast; 3) strong silicification is also exposed further to the east (E silica zone); 4) silica breccia fabrics dip consistently to the northeast; and 5) argillic alteration intensifies to the northeast.

The regional structural style is indicative of classic Mexican, Basin and Range geometry, and it is reasonable to assume that extensional features, favorable loci for intrusions and conduits for hydrothermal fluids, trending approximately North‐South, exist between topographic highs. It is likely that one of these extensional features exists to the east of the Centauro mesa and this is a target for further drilling.


Figure 1. Looking north to Centauro Mesa showing the three, variably altered, conglomerate zones

Field mapping has also defined the area to the north of the mesa and to the east of CEN-08-1, the northernmost drill hole in the 2008 program as another area of prime interest. Strongly silicified zones in the calcareous siltstones and limestone conglomerates in this area carry breccia veins with antimony (stibnite), and disseminated arsenic (realgar and orpiment) mineralization over an area at least 400 m wide across strike. DDH CEN-08-1 was located further to the west and did not test this area. Gold in soil geochemical anomalies were strongest on Line 6 in the area and the highly anomalous mercury values in both the soils and rock samples indicate that we are still very high in the system, most likely above any bonanza vein system.

Skarn mineralization as calc-silicates, with garnet, epidote, hematite and minor copper mineralization, indicating that buried porphyries exist to the north of Centauro, has been noted to the west of El Pozo, to the south of Juan Pablo, the two hills just to the north of Centauro mesa. This area has never been tested by drilling.

All of the 2008, widely-spaced, drill holes, except CEN-08-8 and 12, intersected elevated gold and silver values over appreciable widths indicating that the system has good potential to host a significant gold/silver deposit. Trace element chemistry, especially mercury, indicates that drilling has most likely been testing the top of the system with the best potential lying at depth.

Dr. Greg Arehart, a professor at the University of Nevada in Reno, and a recognized expert in epithermal and Carlin-type gold deposits, has visited the Centauro Property as a consultant to Silver Spruce, most recently since the 2009 exploration work. He comments: "The general epithermal trend is Hg, As, Sb, Tl, Ba, Ag near the paleosurface, precious metals (Au, Ag) and As below, grading to Ag-base metal deeper zones. The trace element geochemistry, the intense silicification and other geologic features of the project, lead me to believe that we are still at the top of the system. Clearly the alteration package is more complex than originally thought and the additional information obtained in the 2009 work, requires changes in the model, but overall the model remains robust with two major untested target areas"

The phase 2, drill program, to test the two areas of highest potential, is planned to begin in late July or early August 2009, once the contract has been awarded.

About the Centauro Property
The Centauro property is a block of six claims (1,420 hectares), located in the southern part of Chihuahua State, Mexico. It is just north of the Durango State boundary and lies approximately 25 kilometres to the west of Highway 45, Mexico's main north-south highway. The property is subject to an option agreement with a Mexican geologist, whereby Silver Spruce can earn a 100% interest in the property subject to a 3% NSR with a 2% buyback for US$2 million. Compilation maps showing the drill locations, and geology plus pictures and the QA / QC protocols can be viewed on the company website www.silverspruceresources.com.

All analyses were carried out at the Activation Laboratories (Actlabs) facility in Ancaster, Ontario. The drill core samples were sawed, under company supervision, at the field office in Jiminez, Chihuahua State. One half of the core was sampled, mainly at one to three meter intervals, and sent to Minerales Laboratory S.A. de C.V. in Mazatlan for sample preparation, as approved by Actlabs. Pulps were forwarded to Actlabs in Ancaster for analysis. The samples were analyzed either by fire assay (one assay tonne) or neutron activation techniques for gold plus an ICP technique for other elements. Every twenty-fifth sample was also analyzed by fire assay (one assay tonne) for gold and an atomic absorption technique for silver at the Minerales Laboratory in Mazatlan for quality assurance/quality control (QA/QC) purposes. A QA/QC program is in place to increase confidence in the results generated.

ABOUT SILVER SPRUCE
Silver Spruce is a junior exploration company originally focused on uranium in the Central Mineral Belt (CMB) and elsewhere in Labrador, Canada. With interests in more than 8,000 claims totaling more than 2,000 square kilometers in Labrador, Silver Spruce is the second largest landholder in one of the world's premier emerging uranium districts. The company also has gold/silver projects in Mexico and the island of Newfoundland, and base metal projects in central and western Newfoundland making Silver Spruce a leading explorer in Canada and Mexico.

This release has been approved by Peter Dimmell, P.Geo., Vice President of Exploration, Silver Spruce Resources Inc., who is a Qualified Person (QP) as defined in National Instrument 43-101.

For Further Information Contact:

SILVER SPRUCE RESOURCES
HEAD OFFICE
Gordon Barnhill, CFO & Director
Phone: 902.527.5700
Fax: 902.527.5711
E-mail: gbarnhill@silverspruceresources.com
Web: www.silverspruceresources.com

INVESTOR RELATIONS
Hugh Oswald, Ascenta Capital Partners Inc.
Phone: 604.684.4743 ext. 243
Toll Free: 1.866.684.4743 ext. 243
E-mail: hugh@ascentacapital.com
Web: www.ascentacapital.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The Corporation seeks Safe Harbour.
 
 

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