Stewart R. Wallace — 1919–2009 - Society of Economic Geologists

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EXPLORATION REVIEWS 46 SEG NEWSLETTER No 78 JULY 2009 ... from 45 Exploration Reviews (Continued) The most entertaining news in the Spanish exploration-mining scene is the fight for Kinbauri Gold and its El Valle copper-gold skarn deposit located in the Rio Narcea gold belt of northern Spain. On one side is a proposed JV between Kinbauri and Glen Eagle Resources to (re)construct the El Valle mine, which previously had been operated by Rio Narcea Gold Mines. And on the other side is a proposed takeover for the whole of Kinbauri by Orvana Minerals Corp., which operates the Don Mario polymetallic mine in Bolivia. At time of writing, we were waiting for the opening bell of round 3, which includes a court action brought on by Jaguar Financial Corporation against Kinbauri to restrain the potential Glen Eagle transaction. Wow! Stay tuned. Permitting at the Rio Tinto mine is progressing, according to EMED Mining. The company recently submitted “ex - panded and refined project documents” to the Spanish regulatory authorities. SWEDEN Gold-Ore Resources Ltd. now considers the development of the Bjorkdal mine, located in the eastern part of the Skellefteå district, to be substantially complete and in commercial production. The company has implemented an expansion in both the open pit and underground workings, and is targeting annualized production of 50,000 oz of gold per year in 2009. Bjorkdal is described by the company as an intrusion-related gold system. Avalon Minerals Ltd. announced an A$1M underwritten rights issue to fund a new drilling campaign at the Viscaria copper deposit in the Norbotten area close to the Kiruna iron mine. Viscaria is a copper-iron greenstone-hosted deposit, interpreted to be a VMS deposit. IGE Nordic AB announced a NI 43- 101 compliant mineral resource estimate for the Rönnbäcken nickel project in northern Sweden. Total indicated and inferred resources at the project are 247.8 Mt at 0.114% Ni in sulfides. The company is now targeting a resource of 320 to 375 Mt of 0.10 to 0.15% Ni in sulfides. TURKEY Eldorado Gold Corp. announced that an internal review of the Kı lada gold mine operations in U ak province identified opportunities to increase production by 30 to 40% and lower unit costs by up to 15%. The mine’s gold inventory presently stands at 5.5 Moz of reserves and 10.4 Moz of resources. Additionally, construction at the Efemçukuru low tointermediate sulfidation epithermal deposit, near Izmir, is continuing. Startup of production is forecast for mid-2010. Anatolia Minerals Development Ltd. has raised approximately C$120M this spring in a public offering and project debt financing. The majority of the funds will be used to complete construction of the Çöpler Au-Ag mine in central Turkey, near Erzıncan. A significant portion of the money will be used to better define the extent and amount of gold mineralization in the sulfide zone of the porphyry deposit. Anatolia plans to drill upward of 12,000 m in the program. Ariana Resources began trial mining at the Sındırgı low sulfidation epithermal vein deposit. The company continues to explore the numerous veins in the district. Aldridge Minerals Inc. is proceeding with metallurgical testing of its Yenipazar VMS deposit, located near Yozgat in west-central Turkey. Koza Altın continues to mine gold at three small, low-sulfidation epithermal deposits: Ovacık and Küçükdere in the Izmir-Balıkesir area of western Turkey, and Mastra, near Gümü hane in northeastern Turkey. LATIN AMERICA Regional Correspondent: Mark I. Pfau (SEG 2001) Tellurian Exploration, Inc. Missoula, Montana E-mail: markpfau@fastmail.fm Country Correspondents: Angelo Peri (SEG 1992) – Argentina and Chile Erme Enriquez (SEG 1985) – Mexico Minera Canasil, S.A. de C.V. E-mail: eenriquez@canasil.com.mx Regina Baumgartner (SEG 2001) – Peru ECUADOR and COLOMBIA Firms with exploration and development projects in Ecuador suffered a setback last April 2008 when the Constituent Assembly issued a mandate halting all mining activity until the new law was enacted. The law has since been approved, in January of this year, and resumption of exploration activities is still pending, after being delayed by the national elections. Correa won again, no surprise there. Nonetheless, undersecretary of mines, Jose Serrano, offered to promptly issue permits to resume operations while speaking to participants of the 2009 Prospectors and Developers Association of Canada (PDAC), held in Toronto last March. Permits are expected to be inhand by mid-June. Several companies are anxiously awaiting resumption of exploration and development activity in Ecuador, including Cornerstone (Macará strategic alliance with Newmont), Corriente (Mirador), Kinross (Fruta Del Norte), Dynasty Metals and Mining (approval granted for Zaruma in April), IAMGOLD (Quimsacocha) and Nortec Ventures, who are waiting on TSX approval of their offer to purchase the assets of Ascendant Copper Corp. Details will follow in the next SEG Newsletter. Colombia is once again moving ahead with serious mineral exploration, particularly in precious metals. This comes as a result of the environmental ministry’s resolution of the year-old forest reserves moratorium in early May. The immediate beneficiary is Anglogold Ashanti’s 12 Moz La Colosa gold project, which triggered the showdown. Attempts to contact Greystar (Angostura) and Colombia Goldfields (Marmato Mountain) about the status of these projects proved difficult as of this writing, due to so many of the senior staff of these companies being currently in Colombia. However, Greystar just awarded the feasibility study of Angostura (11.55 Moz) to GRD Minproc. ARGENTINA In the Andean Cordillera of northern Argentina, near the border with Bolivia, Soltera Mining Corp. carried out geochemical sampling in its El Torno gold property. The property hosts a series of large, Au-bearing veins extending intermittently for 14 km within metamorphosed Ordovician rocks. The central parts of the vein system have been worked since the Inca Period and there are more than 1,000 m of underground galleries. A 2,100-m drilling program in 1997 showed that a 2-m-thick zone on the west side of the vein carries up to 37 g/t gold, and suggested that there is potential for several million ounces along the full length of the vein. Samples of the host rock have also shown up to 112 g/t gold. Soltera carried out a stream sediment sampling that covered about 100 km 2 , outlining a series of anomalies along the vein system together with
JULY 2009 No 78 SEG NEWSLETTER 47 several anomalies in the country rocks up to 2 km away from the main vein. A second survey focused on the identified anomalies covering an area of about 15 km 2 confirmed the presence of a major gold anomalous zone about 5 km north-south and up to almost 2 km wide centered on the vein system and extending beyond the vein into the country rocks on either side. Soltera believes that these structural controlled anomalies suggest that gold is dispersed throughout the host rocks forming important exploration targets for possible open-pit mineralization. In Argentina`s Catamarca province, Yamana Gold is in the final stages of getting environmental approval for its Agua Rica copper-gold project. Yamana acquired Agua Rica when it took over Northern Orion Resources in 2007. The property contains 21.8 billion pounds of copper and 13.3 Moz of gold. Agua Rica sits close to Xstrata Plc’s Bajo la Alumbrera mine, in which Yamana owns a minority stake. In the southernmost Argentina Santa Cruz province, Minera Andes’ San José mine raised its output in the first quarter to 1.30 Moz silver and 16,560 oz gold, from 968,00 0oz silver and 12,140 oz gold. The mine’s cash costs in the recent period has dropped 28% and 21%respectively to US$4.99/oz silver and US$357/oz gold. Minera Andes also started drilling at its Celestina and Martes 13 gold exploration projects. The company said it will explore 10 epithermal veins at Celestina and carry out a 1,500 to 2,000-m drilling program at Martes 13 focusing on recently identified targets. Pan American Silver has officially inaugurated its Manantial Espejo goldsilver mine. The company expects Manantial Espejo to churn out 4.3 Moz of silver and 60,000 oz of gold in 2009 with an estimated mine life of 10 years. The mine poured its first gold-silver doré in December, and has produced 415,000 oz silver and 7,000 oz gold through February 2009. CHILE After more than a year of negotiations, the governments of Chile and Argentina reached an agreement on tax regime and key permits for Barrick Gold`s Pascua Lama project, which sits in the border of the two countries. Crushing will take place in Chile, and processing in Argentina. Water for the operation will come primarily from Argentina. Pascua Lama has reserves of 18 Moz Au and 718 Moz Ag for its estimated 25-year mine life. Start up capex now stands at US$2.8 to 3 billion. In the Maricunga gold belt of northern Chile, Exeter Resources has updated the resources at its Caspiche project to 450 Mt grading 0.65% g/t Au in the inferred category, and also contains 376 Mt at 0.25% Cu sulfide and 2.4 Mt grading 1.3% Cu oxide. Barrick Gold agreed to transfer exploration rights in the Maricunga belt to Andina Minerals in exchange for 2.5% of Andina’s common shares and US$1.5M in additional shares in a year. Barrick also will be entitled to a 1.5% net smelter return royalty on any metal produced at the concessions granted to Andina. The properties in question surround Andina’s Volcán gold project and increase the company’s concessions from 9,800 ha to 24,840 ha. The estimated resources of t Volcán project are 242 Mt grading 0.85 g/t gold in inferred category, using a 0.5 g/t cutoff. Chile’s state copper producer, Codelco, is planning to carry out two drilling programs for a total of 16,000 m in its Inca de Oro project, located in Region III, northern Chile. Inca de Oro is considered by some locals as the natural replacement for the nearby Salvador mine, which is scheduled for closure once sulfides are mined out by the end of 2011. The state miner had aimed to auction off Inca del Oro but postponed the plan due to poor market conditions caused by the global financial slowdown. Codelco also announced the discovery of a new Cu deposit, El Americano, near its Andina mine, located in Region V, central Chile. The world’s largest copper producer, Codelco produced 390,000 t in the first quarter. Freeport-McMoRan Exploration Corporation completed a 7-hole, 1,300m reverse circulation drill program at Coro Mining Corp‘s Llancahue prospect, located 38 km southwest of Talca in central Chile. Llancahue is part of their Talca belt exploration agreement. One of the holes was designed to test exposed copper mineralization at the edge of a cover area, and intersected 100 m at 1.375% Cu, 0.015% Mo, and 3.8 g/t Ag from 10 to 110 m. The other holes were drilled over outcrop alteration with associated geochemistry anomalies, and intersected propylitic al - teration without copper mineralization. MEXICO Esperanza Silver Corp has begun a preliminary economic assessment study of its wholly owned Cerro Jumil gold project located in the Morelos state. Measured and indicated resources are of the order of 22.227 million tonnes (Mt) @ 0.85 g/t Au and 0.6 g/t Ag or 642,000 oz of gold equivalent. The project will be an open pit, heap-leach operation for recovery of gold and silver. Good luck to Esperanza Silver on this new phase of this property! Farallon Resources Ltd. announced that it has reached commercial production, starting on the first day of April, at its G-9 mine located within the Campo Morado mining district in the Guerrero state. The mine is now operating at full design capacity of 1,500 TPD. G-9 mine measured and indicated resources at a cutoff of 5% Zn are of the order of 2.180 Mt @ 3.00 g/t Au, 209.1 g/t Ag, 1.48% Cu, 1.32% Pb and 11.0% Zn. The focus going forward is on improving operational efficiencies in both the mine and mill, with particular emphasis on improving mill recoveries. Goldcorp Inc. has announced that the Peñasquito property construction of mine and mill remain on schedule. The first phase of the sulfide process plant remains on track for commencement of construction in mid-2009, with production of first metals concentrates anticipated in late 2009. Mining activity at the site has been very successful, with mining rates now averaging over 500,000 TPD and over 3 Mt of sulfide ore added to stockpiles. Exploration activity at Peñasquito is focused on a number of compelling regional targets, including delineation drilling at Noche Buena and initial drill tests at El Quemado and Gallos Blancos. MAG Silver Corp. announced the Resource Estimate for the Valdecañas vein, located in the Zacatecas state. The Indicated Resources are on the order of 2.95 Mt @ 879 g/t Ag, 2.22 g/t Au, 2.39% Pb and 4.15% Zn. The inferred resource for Valdecañas FW and HW veins and the stockwork zone has been estimated to 7.21 Mt @ 458 g/t Ag, 1.54 g/t Au, 1.89% Pb and 3.14% Zn. The total contained metals in the indicated resource are 83 Moz of silver, 210,000 oz of gold, 155 million pounds of lead, and 269 million pounds of zinc. The inferred resources contain an additional 106 Moz of silver, 356,000 ounces of gold, 301 million pounds of lead and 498 million pounds of zinc. Minera Juanicipio S.A. de C.V., a 56/44 joint venture between Fresnillo plc and MAG, reported excellent preliminary metallurgical results of combined recoveries in the lead and zinc concentrates of 96% silver, 88% gold, 90% lead and 82% zinc from selective flotation tests. Minefinders Corporation Ltd. announced that it has to page officially inaugurated 48 ... EXPLORATION REVIEWS
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Stewart R. Wallace — 1919–2009 - Society of Economic Geologists

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