Options Executed to Acquire Two Historical
Mine Areas
PERTH,
Australia, Nov. 15, 2023 /CNW/ - Hot Chili Limited
(ASX: HCH) (TSXV: HCH) (OTCQX: HHLKF) ("Hot Chili" or the
"Company") is pleased to announce that the Company has entered into
Option Agreements to acquire 100% interest in two historical copper
mine areas; Marsellesa and Cordillera, located near Hot Chili's
Costa Fuego Copper-Gold Project ("Costa Fuego" or "the Project") in
the coastal range of the Atacama Region, Chile
Marsellesa and Cordillera are located approximately 10km
southwest of Costa Fuego's planned central processing hub (refer
accompanying Figures 1 to 4).
Both mine areas have been privately held and historically
exploited for shallow copper oxide and copper sulphide material but
have never previously been drill tested.
The Marsellesa mine area is laterally extensive, measuring
400m in length and 200m in width, with mine workings exposing
multiple zones of shallowly-dipping, strata-bound (manto-style),
copper mineralisation.
Lying approximately 1km west of Marsellesa, the smaller
Cordillera mine workings expose outcropping porphyry copper
mineralisation with well-developed stockwork and sheeted A and B
style porphyry veining.
First-pass Reverse Circulation (RC) drilling is planned to
commence at Marsellesa and Cordillera in the coming week, following
completion of drilling at the Company's Corroteo exploration
target, located 5km southeast of the Cortadera porphyry copper-gold
deposit.
These latest project additions, including the Cometa project (as
announced 28th August
2023), provide a pipeline of opportunities and additional
optionality for the discovery of new mineral resources for the
Company's Costa Fuego copper hub.
Hot Chili continues to pursue further regional consolidation as
the Company advances its growth strategy for Costa Fuego.
The Company's recently published Preliminary Economic Assessment
entitled Costa Fuego Copper Project – NI 43-101 Technical Report
Preliminary Economic Assessment with an effective date of
June 28, 2023 (the "PEA")1
establishes Costa Fuego as a low-risk, long life copper project
benefiting from a low start-up capital and a high annual copper
equivalent2 metal production profile of over 100 kt for
a 16-year mine life, including 95 kt copper and 49 koz gold during
primary production (first 14 years) at C1 Cash Cost3 of
US$1.33/lb (estimated net of
by-product credits).
Hot Chili is focussed on up-scaling Costa Fuego's resource base
and potential study scale towards a 150,000 tpa copper production
profile, in order to further enhance project returns ahead of the
delivery of the Costa Fuego Pre-Feasibility Study ("PFS").
The material terms of the executed Marsellesa Option
Agreement are as follows:
- Hot Chili's subsidiary Sociedad Minera La Frontera SpA
("Frontera") has executed a definitive option agreement with
Hermanos Pefaur SpA, the holder of a 100% interest in the
concession comprising Marsellesa, for the grant to Frontera of an
option to acquire a 100% interest in the Marsellesa concession
("Marsellesa Option").
- Non-refundable cash payment of US$100,000 to Pefaur upon grant of the Marsellesa
Option.
- Non-refundable cash payment of US$100,000 within 12 months from the grant of the
Marsellesa Option.
- Non-refundable cash payment of US$150,000 within 24 months from the grant of the
Marsellesa Option.
- Option may be exercised within 36 months of the date of grant
of the Marsellesa Option for a final non-refundable cash payment of
US$1,000,000.
- Pefaur will also be granted a 1% NSR royalty over the
Marsellesa concession on exercise of the Marsellesa Option.
Frontera will have a right of first refusal to buy-back the NSR
royalty.
The material terms of the executed Cordillera Option
Agreement are as follows:
- Hot Chili's subsidiary Sociedad Minera La Frontera SpA
("Frontera") has executed a definitive option agreement with Mr
Arnaldo Del Campo ("ADC") the holder
of a 100% interest in the concessions comprising Cordillera, for
the grant to Frontera of an option to acquire a 100% interest in
the Cordillera concessions ("Cordillera Option").
- Non-refundable cash payment of US$100,000 to ADC upon grant of the Cordillera
Option.
- Non-refundable cash payment of US$200,000 within 24 months from the grant of the
Cordillera Option.
- Option may be exercised within 48 months of the date of grant
of the Cordillera Option for a final non-refundable cash payment of
US$3,700,000.
- Within the Cordillera concessions, ADC will also be granted a
1% NSR royalty over any material extracted from underground
operations, and a 1.5% NSR royalty over any material extracted from
open pit operations, on exercise of the Cordillera Option. Frontera
will have a right of first refusal to buy-back the NSR
royalties.
__________________________________
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1 The PEA is
preliminary in nature and includes 3% inferred mineral resources
that are considered too speculative geologically to have the
economic considerations applied to them that would enable them to
be categorized as mineral reserves, and there is no certainty that
the PEA will be realized. Mineral resources that are not
mineral reserves do not have demonstrated economic viability. See
Page 6 for additional cautionary language.
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2 CuEq considers
assumed commodity prices and average metallurgical recoveries from
testwork. See page 9 for complete mineral resource disclosure of
Costa Fuego.
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3 See page 7 for full
non-IFRS measures discussion.
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Hot Chili is well positioned with A$21.8
million in cash (as of 30th September 2023), and a near-term focus on
regional land consolidation and rapid definition of additional high
grade and bulk tonnage copper resources for Costa Fuego.
The Company looks forward to providing further updates as
exploration drilling activities progress across Corroteo,
Marsellesa and Cordillera.
This announcement is authorised by the Board of Directors for
release to ASX and TSXV.
Hot Chili's Managing Director and Chief Executive Officer Mr
Christian Easterday is responsible
for this announcement and has provided sign-off for release to the
ASX and TSXV.
For more information please contact:
Christian Easterday
Managing Director – Hot
Chili
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Tel: +61 8 9315
9009
Email:
admin@hotchili.net.au
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Penelope Beattie
Company Secretary – Hot
Chili
|
|
Tel: +61 8 9315
9009
Email:
admin@hotchili.net.au
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Harbor Access
Investor & Public
Relations (Canada)
|
|
Email:
graham.farrell@harbor-access.com
Email:
jonathan.paterson@harbor-access.com
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or visit Hot Chili's website at
www.hotchili.net.au
Qualifying Statements
Technical Report
Certain scientific, technical and
economic information contained in this news release is derived from
the PEA. For readers to fully understand such information, they
should read the PEA technical report prepared in accordance with
National Instrument 43-101 – Standards of Disclosure for Mineral
Projects ("NI 43-101") (available on www.sedarplus.ca or at
www.hotchili.net.au) in its entirety, including all qualifications,
assumptions, limitations and exclusions that relate to the
information set out in this news release. The PEA is intended
to be read as a whole, and sections should not be read or relied
upon out of context. The technical information in this news release
is subject to the assumptions and qualifications contained in the
PEA.
Qualified Persons – NI 43-101
The PEA was compiled by
Wood Australia Pty Ltd with contributions from a team of
independent qualified persons (within the meaning of NI 43-101).
The scientific, technical and economic information contained in
this news release pertaining to Coast Fuego is based on the PEA,
which was prepared by the following independent qualified persons
(within the meaning of NI 43-101):
- Ms Elizabeth Haren (MAUSIMM (CP)
& MAIG) of Haren Consulting – Mineral Resource Estimate
- Mr Dean David (FAUSIMM (CP)) of
Wood Pty Ltd – Metallurgy
- Mr Piers Wendlandt (PE) of Wood
Pty Ltd – Market Studies and Contracts, Economic Analysis
- Mr Jeffrey Steven (PE) of Wood
Pty Ltd – Capital and Operating Costs
- Mr Anton von Wielligh (FAUSIMM) of ABGM Consulting Pty Ltd –
Mine Planning and Scheduling
- Mr Edmundo Laporte (PE) of GAC –
Environmental Studies, Permitting and Social or Community
Impact
- Mr Dave Morgan (PE) of Knight
Piésold – Project Infrastructure (TSF)
The independent qualified persons have verified the information
disclosed in the PEA, including the sampling, preparation,
security, and analytical procedures underlying such
information.
Disclosure regarding mine planning and infrastructure has been
reviewed and approved by Mr Grant
King, FAUSIMM, Hot Chili's Chief Operations Officer, and a
qualified person within the meaning of NI 43-101.
The scientific and technical information in this new release,
other than such information derived from the PEA, has been reviewed
and approved by Mr Christian
Easterday, MAIG, Hot Chili's Managing Director and Chief
Executive Officer, and a qualified person within the meaning of NI
43-101.
Competent Persons – JORC
The information in this
announcement that relates to Exploration Results for the Marsellesa
and Cordillera projects is based upon information compiled by Mr
Christian Easterday, the Managing
Director and a full-time employee of Hot Chili Limited whom is a
Member of the Australasian Institute of Geoscientists (AIG). Mr
Easterday has sufficient experience that is relevant to the style
of mineralisation and type of deposits under consideration and to
the activity which he is undertaking to qualify as a 'Competent
Person' as defined in the 2012 Edition of the 'Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore
Reserves' (JORC Code). Mr Easterday consents to the inclusion in
the report of the matters based on their information in the form
and context in which it appears.
The information in this announcement that relates to Mineral
Resources for the Costa Fuego Project is based on information
compiled by Ms Elizabeth Haren, Mr
Dean David, Mr Piers Wendlandt, Mr Jeffrey Steven, Mr Anton von Wielligh, Mr
Edmundo Laporte and Mr Dave Morgan. Ms Haren is a full-time employee of
Haren Consulting Pty Ltd and a Member and Chartered Professional of
The Australasian Institute of Mining and Metallurgy and a Member of
the Australian Institute of Geoscientists. Mr David is a full-time
employee of Wood Pty Ltd and a Fellow of The Australasian Institute
of Mining and Metallurgy. Mr Wendlandt is a full-time employee of
Wood Pty Ltd and a Registered Professional Engineer in the
State of Colorado. Mr Steven is a
full-time employee of Wood Pty Ltd and a Registered Professional
Engineer in the State of British
Columbia. Mr von Wielligh is
a full-time employee of ABGM Consulting Pty Ltd and a Fellow of the
Australasian Institute of Mining and Metallurgy. Mr Laporte is a
full-time employee of GAC and a registered Professional Engineer in
Alberta, Nova Scotia and Ontario, Registered Member of the Society for
Mining, Metallurgy & Exploration and a Chartered Professional
Engineer in Australia. Mr Morgan
is a full-time employee of Knight Piésold Pty Ltd and a Member of
the Australasian Institute of Mining and Metallurgy and Chartered
Professional Engineer.
Ms Haren, Mr David, Mr Wendlandt, Mt Steven, Mr von Wielligh, Mr Laporte and Mr Morgan have
sufficient experience, which is relevant to the style of
mineralisation and types of deposits under consideration and to the
activities undertaken, to qualify as a Competent Person as defined
in the 2012 Edition of the 'Australasian Code of Reporting of
Exploration Results, Mineral Resources and Ore Reserves'.
Disclaimer
Neither the 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 news release.
Cautionary Note for U.S. Investors Concerning Mineral
Resources
NI 43-101 is a rule of the Canadian Securities
Administrators which establishes standards for all public
disclosure an issuer makes of scientific and technical information
concerning mineral projects. Technical disclosure contained in this
news release has been prepared in accordance with NI 43-101 and the
Canadian Institute of Mining, Metallurgy and Petroleum
Classification System. These standards differ from the requirements
of the U.S. Securities and Exchange Commission ("SEC") and resource
information contained in this news release may not be comparable to
similar information disclosed by domestic United States companies subject to the SEC's
reporting and disclosure requirements.
All amounts in this news release are in U.S. dollars unless
otherwise noted.
Non IFRS Financial Performance Measures
"C1 Cash Cost"
is not a performance measures reported in accordance with
International Financial Reporting Standards ("IFRS"). These
performance measures are included because these statistics are key
performance measures that management uses to monitor performance.
Management uses these statistics to assess how the Costa Fuego
Project compares against its peer projects and to assess the
overall effectiveness and efficiency of the contemplated mining
operations. These performance measures do not have a meaning within
IFRS and, therefore, amounts presented may not be comparable to
similar data presented by other mining companies. These performance
measures should not be considered in isolation as a substitute for
measures of performance in accordance with IFRS.
Forward Looking Statements
This news release contains
certain statements that are "forward-looking information" within
the meaning of Canadian securities legislation and Australian
securities legislation (each, a "forward-looking statement").
Forward-looking statements reflect the Company's current
expectations, forecasts, and projections with respect to future
events, many of which are beyond the Company's control, and are
based on certain assumptions. No assurance can be given that these
expectations, forecasts, or projections will prove to be correct,
and such forward-looking statements included in this news release
should not be unduly relied upon. Forward-looking information is by
its nature prospective and requires the Company to make certain
assumptions and is subject to inherent risks and uncertainties. All
statements other than statements of historical fact are
forward-looking statements. The use of any of the words "believe",
"could", "estimate", "expect", "may", "plan", "planned",
"planning", "potential", "project", "projections", "should",
"up-scale", "will", "would" and similar expressions are intended to
identify forward-looking statements.
The forward-looking statements within this news release are
based on information currently available and what management
believes are reasonable assumptions. Forward-looking statements
speak only as of the date of this news release. In addition, this
news release may contain forward-looking statements attributed to
third-party industry sources, the accuracy of which has not been
verified by the Company.
In this news release, forward-looking statements relate, among
other things, to: the Company's timing and ability to enter into a
definitive agreement with respect to the Option; the completion of
the conditions to exercise the Option; receipt of all regulatory
approvals in respect of the Option, including the approval of the
TSXV (if required); prospects, projections and success of the
Company and its projects; the ability of the Company to expand
mineral resources beyond current mineral resource estimates; the
results and impacts of current and planned drilling, to extend
mineral resources and to identify new deposits, including at
Marsellesa, Cordillera and Corroteo; the Company's ability to
convert mineral resources to mineral reserves; opportunities for
growth in mineral projects; the timing and outcomes of future
planned economic studies; the Company's ability to up-scale the
Project to 150,000 tpa of copper production; the timing and
outcomes of regulatory processes required to obtain permits for the
development and operation of the Costa Fuego Project as
contemplated in the PEA and/or future planned economic studies;
whether or not the Company will make a development decision and the
timing thereof; the ability of the Company to consolidate
additional landholdings around its Project; estimates of cost; and
estimates of planned exploration across multiple Corroteo,
Marsellesa and Cordillera.
Forward-looking statements involve known and unknown risks,
uncertainties, and other factors, which may cause the actual
results, performance, or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. A number of factors could cause actual results to
differ materially from a conclusion, forecast or projection
contained in the forward-looking statements in this news release,
including, but not limited to, the following material factors: the
ability of the Company to complete the conditions to exercise the
Option; obtaining all regulatory approvals for the completion of
the Option; operational risks; risks related to the cost estimates
of exploration; sovereign risks associated with the Company's
operations in Chile; changes in
estimates of mineral resources of properties where the Company
holds interests; recruiting qualified personnel and retaining key
personnel; future financial needs and availability of adequate
financing; fluctuations in mineral prices; market volatility;
exchange rate fluctuations; ability to exploit successful
discoveries; the production at or performance of properties where
the Company holds interests; ability to retain title to mining
concessions; environmental risks; financial failure or default of
joint venture partners, contractors or service providers;
competition risks; economic and market conditions; and other risks
and uncertainties described elsewhere in this news release and
elsewhere in the Company's public disclosure record.
Although the forward-looking statements contained in this news
release are based upon assumptions which the Company believes to be
reasonable, the Company cannot assure investors that actual results
will be consistent with these forward-looking statements. With
respect to forward-looking statements contained in this news
release, the Company has made assumptions regarding: future
commodity prices and demand; availability of skilled labour; timing
and amount of capital expenditures; future currency exchange and
interest rates; the impact of increasing competition; general
conditions in economic and financial markets; availability of
drilling and related equipment; effects of regulation by
governmental agencies; future tax rates; future operating costs;
availability of future sources of funding; ability to obtain
financing; and assumptions underlying estimates related to adjusted
funds from operations. The Company has included the above summary
of assumptions and risks related to forward-looking information
provided in this news release to provide investors with a more
complete perspective on the Company's future operations, and such
information may not be appropriate for other purposes. The
Company's actual results, performance or achievement could differ
materially from those expressed in, or implied by, these
forward-looking statements and, accordingly, no assurance can be
given that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do so, what
benefits the Company will derive therefrom.
For additional information with respect to these and other
factors and assumptions underlying the forward-looking statements
made herein, please refer to the public disclosure record of the
Company, including the Company's most recent Annual Report, which
is available on SEDAR+ (www.sedarplus.ca) under the Company's
issuer profile. New factors emerge from time to time, and it is not
possible for management to predict all those factors or to assess
in advance the impact of each such factor on the Company's business
or the extent to which any factor, or combination of factors, may
cause actual results to differ materially from those contained in
any forward-looking statement.
The forward-looking statements contained in this news release
are expressly qualified by the foregoing cautionary statements and
are made as of the date of this news release. Except as may be
required by applicable securities laws, the Company does not
undertake any obligation to publicly update or revise any
forward-looking statement to reflect events or circumstances after
the date of this news release or to reflect the occurrence of
unanticipated events, whether as a result of new information,
future events or results, or otherwise. Investors should read this
entire news release and consult their own professional advisors to
ascertain and assess the income tax and legal risks and other
aspects of an investment in the Company.
Mineral Resource
Statement
Costa Fuego Combined Mineral Resource (Effective Date
31st March 2022)
1 Mineral Resources are reported on a
100% Basis - combining Mineral Resource estimates for the
Cortadera, Productora and San Antonio deposits. All figures
are rounded, reported to appropriate significant figures, and
reported in accordance with the Joint Ore Reserves Committee Code
(2012) and the Canadian Institute of Mining, Metallurgy and
Petroleum (CIM) Standards on Mineral Resources and Reserves,
Definitions and Guidelines prepared by the CIM Standing Committee
on Reserve Definition, as required by National Instrument
43-101.
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2 The
Productora deposit is 100% owned by Chilean incorporated company
Sociedad Minera El Aguila SpA (SMEA). SMEA is a joint venture (JV)
company – 80% owned by Sociedad Minera El Corazón Limitada (a 100%
subsidiary of Hot Chili Limited), and 20% owned by CMP Productora
(a 100% subsidiary of Compañía Minera del Pacífico S.A
(CMP)).
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3. The
Cortadera deposit is controlled by a Chilean incorporated company
Sociedad Minera La Frontera SpA (Frontera). Frontera is a
subsidiary company – 100% owned by Sociedad Minera El Corazón
Limitada, which is a 100% subsidiary of Hot Chili
Limited.
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4 The
San Antonio deposit is controlled through Frontera (100% owned by
Sociedad Minera El Corazón Limitada, which is a 100% subsidiary of
Hot Chili Limited) and has an Option Agreement with a private party
to earn a 90% interest.
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5 The
Mineral Resource estimates in the tables above form coherent bodies
of mineralisation that are considered amenable to a combination of
open pit and underground extraction methods based on the following
parameters: Base Case Metal Prices: Copper US$ 3.00/lb, Gold US$
1,700/oz, Molybdenum US$ 14/lb, and Silver US$20/oz.
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6
Metallurgical recovery averages for each deposit consider Indicated
+ Inferred material and are weighted to combine sulphide flotation
and oxide leaching performance. Process recoveries: Cortadera and
San Antonio – Weighted recoveries of 82% Cu, 55% Au, 82% Mo and 37%
Ag. CuEq(%) = Cu(%) + 0.56 x Au(g/t) + 0.00046 x Mo(ppm) +
0.0043 x Ag(g/t). Productora – Weighted recoveries of 84% Cu, 47%
Au, 47% Mo and 0% Ag (not reported). CuEq(%) = Cu(%) + 0.46 x
Au(g/t) + 0.00026 x Mo(ppm). Costa Fuego – Recoveries of 83% Cu,
53% Au, 69% Mo and 23% Ag. CuEq(%) = Cu(%) + 0.52 x Au(g/t) +
0.00039 x Mo(ppm) + 0.0027 x Ag(g/t).
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7 Resource Copper Equivalent (CuEq)
grades are calculated based on the formula: CuEq% = ((Cu% × Cu
price 1% per tonne × Cu_recovery) + (Mo ppm × Mo price per g/t ×
Mo_recovery)+(Au ppm × Au price per g/t × Au_recovery)+ (Ag ppm ×
Ag price per g/t × Ag_recovery)) / (Cu price 1% per tonne × Cu
recovery). The base case cut-off grade for mineral resources
considered amenable to open pit extraction methods at the
Cortadera, Productora and San Antonio deposits is 0.21% CuEq while
the cut-off grade for mineral resources considered amenable to
underground extraction methods at the Cortadera deposit is 0.3%
CuEq.
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8 Mineral resources are not mineral
reserves and do not have demonstrated economic viability. These
Mineral Resource estimates include Inferred Mineral Resources that
are considered too speculative geologically to have economic
considerations applied to them that would enable them to be
categorised as Mineral Reserves. It is reasonably expected that the
majority of Inferred mineral resources could be upgraded to
Measured or Indicated Mineral Resources with continued
exploration.
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9 The
effective date of the estimate of Mineral Resources is March 31st,
2022. Refer to ASX Announcement "Hot Chili Delivers Next Level of
Growth" ("Resource Announcement") for JORC Code Table 1 information
related to the Costa Fuego Resource Estimate (MRE) by Competent
Person Elizabeth Haren, constituting the MREs of Cortadera,
Productora and San Antonio (which combine to form Costa Fuego). Hot
Chili confirms it is not aware of any new information or data that
materially affects the information included in the Resource
Announcement and all material assumptions and technical parameters
stated for the Mineral Resource Estimates in the Resource
Announcement continue to apply and have not materially
changed.
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10 Hot
Chili Limited is not aware of political, environmental or other
risks that could materially affect the potential development of the
Mineral Resources.
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Appendix 1. JORC Code Table 1 for Marsellesa and Cordillera
Landholdings
Section 1 Sampling Techniques and Data
Criteria
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JORC Code
explanation
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Commentary
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Sampling
techniques
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Nature and quality
of sampling (e.g., cut channels,
random chips, or specific specialised industry standard
measurement tools appropriate to the minerals under
investigation, such as down hole gamma sondes, or
handheld XRF instruments, etc.). These examples should
not be taken as limiting the broad meaning of sampling.
Include reference to
measures taken to ensure sample
representivity and the appropriate calibration of any
measurement tools or systems used.
Aspects of the
determination of mineralisation that are
Material to the Public Report.
In cases where
'industry standard' work has been done
this would be relatively simple (e.g. 'reverse circulation
drilling was used to obtain 1 m samples from which 3 kg
was pulverised to produce a 30 g charge for fire assay').
In other cases more explanation may be required, such
as where there is coarse gold that has inherent sampling
problems. Unusual commodities or mineralisation types
(eg submarine nodules) may warrant disclosure of
detailed information.
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No known drilling has
been completed on the Marsellesa or
Cordillera Landholdings.
For soil samples,
maximum 1 kg sample collected from 20 cm
below surface and sieved down to 2 mm.
Samples transported to
La Serena sample preparation facility
by Company employees and tested ME-MS61 (multi-element
geochemistry) and Au-AA23 (gold assay).
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Drilling
techniques
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Drill type (eg core,
reverse circulation, open-hole
hammer, rotary air blast, auger, Bangka, sonic, etc) and
details (eg core diameter, triple or standard tube, depth of
diamond tails, face-sampling bit or other type, whether
core is oriented and if so, by what method, etc).
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No known drilling has
been completed on the Marsellesa or
Cordillera Landholdings.
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Drill sample
recovery
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Method of recording
and assessing core and chip sample
recoveries and results assessed.
Measures taken to
maximise sample recovery and
ensure representative nature of the samples.
Whether a
relationship exists between sample recovery
and grade and whether sample bias may have occurred
due to preferential loss/gain of fine/coarse
material.
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No known drilling has
been completed on the Marsellesa or
Cordillera
Landholdings.
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Logging
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Whether core and
chip samples have been geologically
and geotechnically logged to a level of detail to support
appropriate Mineral Resource estimation, mining studies
and metallurgical studies.
Whether logging is
qualitative or quantitative in nature.
Core (or costean, channel, etc) photography.
The total length and
percentage of the relevant
intersections logged.
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No known drilling has
been completed on the Marsellesa or
Cordillera
Landholdings.
Soils were
qualitatively logged, including weathering and
texture.
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Sub-
sampling techniques
and sample
preparation
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If core, whether cut
or sawn and whether quarter, half or
all core taken.
If non-core, whether
riffled, tube sampled, rotary split, etc
and whether sampled wet or dry.
For all sample
types, the nature, quality and
appropriateness of the sample preparation technique.
Quality control
procedures adopted for all sub-sampling
stages to maximise representivity of samples.
Measures taken to
ensure that the sampling is
representative of the in situ material collected, including
for instance results for field duplicate/second-half
sampling.
Whether sample sizes
are appropriate to the grain size of
the material being sampled.
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No known drilling has
been completed on the Marsellesa or
Cordillera Landholdings.
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Quality of
assay data and laboratory
tests
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The nature, quality
and appropriateness of the assaying
and laboratory
procedures used and whether the
technique is
considered partial or total.
For geophysical
tools, spectrometers, handheld XRF
instruments, etc,
the parameters used in determining the
analysis including instrument make and model,
reading
times, calibrations
factors applied and their derivation,
etc.
Nature of quality
control procedures adopted (eg
standards, blanks, duplicates, external laboratory checks)
and whether acceptable levels of accuracy (ie lack
of
bias) and precision
have been established.
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ME-MS61 was used for
multi-element geochemistry due to the
low detection limit of this technique. ME-MS61 is considered a
total method for elements of interest (Copper, Gold, Silver,
Molybdenum, and Cobalt)
Laboratory standards
were used to determine data quality.
Samples are resubmitted if the laboratory standards fail
quality
control checks.
A reduced to Pole (RTP)
magnetic survey has been completed
over the Marsellesa Landholding. The survey was completed in
November 2007 by Argali Geofisica on a line spacing of 200 m
(E-W lines) on the PSAD56 grid.
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Verification
of sampling
and
assaying
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The verification of
significant intersections by either
independent or
alternative company personnel.
The use of twinned
holes.
Documentation of
primary data, data entry procedures,
data verification,
data storage (physical and electronic)
protocols.
Discuss any
adjustment to assay data.
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Electronic copies of
the analysis reports are available. They
are also stored in the company AcQuire database, along with
the laboratory standards.
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Location of
data points
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Accuracy and quality of
surveys used to locate drill holes
(collar and down-hole
surveys), trenches, mine workings
and other locations used in Mineral Resource estimation.
Specification of the
grid system used.
Quality and adequacy of
topographic control.
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Soil sample data
located using a Garmin hand-held GPS.
Data location is recorded in WGS84 Zone 19S.
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Data spacing and
distribution
|
Data spacing for
reporting of Exploration Results.
Whether the data
spacing and distribution is sufficient to
establish the degree of geological and grade continuity
appropriate for the Mineral Resource and Ore Reserve
estimation procedure(s) and classifications applied.
Whether sample
compositing has been applied.
|
Soil samples were
located on a grid oriented north-south on
a 400 m line spacing and 200 m sample spacing.
|
Orientation
of data in
relation to
geological
structure
|
Whether the
orientation of sampling achieves unbiased
sampling of possible
structures and the extent to which
this is known,
considering the deposit type.
If the relationship
between the drilling orientation and the
orientation of key mineralised structures is considered to
have introduced a sampling bias, this should be assessed
and reported if material.
|
Soil sample points were
located near-perpendicular to
assumed strike of geological formations.
|
Sample
security
|
The measures taken
to ensure sample security.
|
Soil samples were
transported by company employees
directly to the laboratory on completion of the program.
|
Audits or
reviews
|
The results of any
audits or reviews of sampling
techniques and data.
|
None
completed.
|
Section 2 Reporting of Exploration Results
Criteria
|
JORC Code
explanation
|
Commentary
|
Mineral tenement
and land tenure status
|
Type, reference
name/number, location and
ownership including agreements or material issues
with third parties such as joint ventures,
partnerships,
overriding royalties, native title
interests, historical sites, wilderness or national
park and environmental settings.
The security of the
tenure held at the time of
reporting along with any known impediments to
obtaining a licence to operate in the area.
|
Geophysical survey and
soil sampling was completed only on the
Marsellesa landholding (Marsellesa 1/5).
|
Exploration done
by other parties
|
Acknowledgment and
appraisal of exploration by other parties.
|
Exploration and mining
on the Marsellesa and Cordillera
tenements have been completed by private parties.
Drilling on surrounding
tenements was completed by Compania
Minera del Pacifico
(CMP).
|
Geology
|
Deposit type,
geological setting and style of mineralisation.
|
The Marsellesa
landholding contains a Fe-Cu mineralised body,
with calcic alteration (actinolite-epidote) extending to the
south
along a NW-SE corridor. Total extent is more than 1,500 m. The
trend is intruded by fine to medium grain diorite and
porphyries
of dacite-andesitic composition.
The Cordillera
landholdings contain porphyry copper
mineralisation with well-developed stockwork and sheeted A
and
B porphyry
veining..
Surface mapping
projects are ongoing across both landholdings.
|
Drillhole
Information
|
A summary of all
information material to the understanding of the exploration
results including a tabulation of the following information for all
Material drill holes:
easting and northing
of the drill hole collar
elevation or RL
(Reduced Level – elevation above sea level in metres) of the drill
hole collar
dip and azimuth of
the hole
down hole length and
interception depth
hole length.
If the exclusion of
this information is justified on the basis that the information is
not Material and this exclusion does not detract from the
understanding of the report, the Competent Person should clearly
explain why this is the case.
|
Drilling by CMP on
surrounding landholdings in listed below (collar
locations only, no information on downhole surveys and
assays).
|
HOLEID
|
X (PSAD_56)
|
Y (PSAD_86)
|
Z (PSAD_86)
|
DEPTH
|
PMEX-079
|
316817
|
6810211
|
1070
|
414.75
|
PMEX-080
|
315611
|
6810548
|
1017
|
387.65
|
PMEX-081
|
315118
|
6810568
|
984
|
440.35
|
PMEX-082
|
315180
|
6809688
|
970
|
398.6
|
PMEX-083
|
315826
|
6809662
|
1011
|
514.3
|
PMEX-084
|
316611
|
6809670
|
1055
|
404.35
|
PMEX-086
|
316825
|
6809165
|
1020
|
408.35
|
PMEX-088
|
315893
|
6809155
|
973
|
461.6
|
PMEX-090
|
316615
|
6810569
|
1093
|
290.8
|
Data aggregation
methods
|
In reporting
Exploration Results, weighting averaging techniques, maximum and/or
minimum grade truncations (eg cutting of high grades) and cut-off
grades are usually Material and should be stated.
Where aggregate
intercepts incorporate short lengths of high-grade results and
longer lengths of low grade results, the procedure used for such
aggregation should be stated and some typical examples of such
aggregations should be shown in detail.
The assumptions used
for any reporting of metal equivalent values should be clearly
stated
|
No known drilling has
been completed on the Marsellesa or
Cordillera Landholdings.
|
Relationship
between mineralisation widths and intercept
lengths
|
These relationships
are particularly important in the reporting of Exploration
Results.
If the geometry of
the mineralisation with respect to the drill hole angle is known,
its nature should be reported.
If it is not known
and only the down hole lengths are reported, there should be a
clear statement to this effect (eg 'down hole length, true width
not known')..
|
No known drilling has
been completed on the Marsellesa or
Cordillera Landholdings.
|
Diagrams
|
Appropriate maps and
sections (with scales) and tabulations of intercepts should be
included for any significant discovery being reported These should
include, but not be limited to a plan view of drill hole collar
locations and appropriate sectional views.
|
Refer to figures in the
announcement.
|
Balanced
reporting
|
Where comprehensive
reporting of all Exploration Results is not practicable,
representative reporting of both low and high grades and/or widths
should be practiced to avoid misleading reporting of Exploration
Results.
|
All assayed soil
samples reported within the Marsellesa and
Cordillera
landholdings.
|
Other substantive
exploration data
|
Other exploration
data, if meaningful and material, should be reported including (but
not limited to): geological observations; geophysical survey
results; geochemical survey results; bulk samples – size and method
of treatment; metallurgical test results; bulk density,
groundwater, geotechnical and rock characteristics; potential
deleterious or contaminating substances.
|
A Reduced to Pole (RTP)
magnetic survey has been completed
over the Marsellesa Landholding. The survey was completed
in
November 2007
by Argali Geofisica on a line spacing of 200 m (E
-W lines) on the PSAD56
grid.
|
Further
work
|
The nature and scale
of planned further work (eg tests for lateral extensions or depth
extensions or large-scale step-out drilling).
Diagrams clearly
highlighting the areas of possible extensions, including the main
geological interpretations and future drilling areas, provided this
information is not commercially sensitive.
|
Additional work
currently being planned across the Marsellesa and
Cordillera
landholdings, including but not limited to detailed litho-
structural mapping, additional extensional and soil
geochemistry,
and preliminary
exploration drilling.
|
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