Orosur Mining Inc. has signed an exploration and joint venture (JV) agreement (agreement) with private Argentinean company DESEADO DORADO S.A.S and its shareholders in relation to the El Pantano Gold Project in the Province of Santa Cruz, Argentina.
The agreement covers nine licences owned by Deseado, that combined, total 607 km2 in the prolific Deseado Massif region of Santa Cruz Province in southern Argentina, roughly 45 km from Anglo Gold’s Cerro Vanguardia mining camp.
The general terms of the agreement allow for the company to earn 100% equity in the project by investing US$3 million over five years in two phases:
- Phase 1, earn 51% by investing US$1 million over an initial three-year period.
- Phase 2, move to 100% ownership by investing an additional US$2 million over a subsequent two-year period and granting Deseado a residual 2% net smelter return royalty on the project.
The agreement will involve the company securing its position by direct ownership in the holding company, Deseado Dorado S.A.S. For added security of tenure, the company will commence with 100% ownership of Deseado.
Formalisation of the agreement ownership structure is expected to take several weeks. However, as the company’s geological team and directors have already made several visits to the project, desk top targeting work has already begun, thus allowing exploration work to commence promptly once the structure is finalised.
Location and geology
The project comprises nine contiguous exploration licences that total 607 km2.
Access to the project is by good, paved road several hours drive south from the regional city of Comodoro Rivadavia, and then roughly 50 km travel on good quality dirt roads west from the Tres Cerros Roadhouse.
The region is arid and sparsely populated, largely as a result of the near complete devastation of the region’s agricultural industry by ashfall from the 1991 eruption of Mt Hudson. Several large and widely spaced estancias remain and may be used as bases for field activities.
A major, national-scale power line runs parallel to the main highway, thus providing plentiful scheme power to the region, and there is sufficient surface and ground water supplies in the region to provide process water to mining operations.
The Deseado Massif is a large area (>60 000 km2) of mid to late Jurassic volcanic rocks in southern Argentina. The region has in recent decades been shown to host numerous high-grade tier-1 gold and silver deposits, the two largest being Anglo Gold’s Cerro Vanguardia mine and Newmont Mining’s Cerro Negro deposit. Other substantial projects include Yamana Gold’s Cerro Moro and Pan American Silver’s Manantial Espejo silver deposit.
Gold and Silver deposits in the Deseado Massif are generally low to intermediate sulfidation epithermal vein style. The most substantial deposits are generally constrained to the extensive areas of Jurassic volcanics and are dominated by major SE-NW structural corridors.
The project is almost completely dominated by Jurassic volcanic rocks that are known to be the primary host of gold and silver mineralisation across the Massif. Much of the area, however, is covered by late basalts, which when coupled with the project’s remote location has possibly contributed to a lower level of historical exploration that might otherwise have been expected given its attractive geology.
Preliminary field inspections undertaken by the company’s geological team have noted large erosional windows within the basalt cover that have exposed extensive areas of prospective volcanics, swarms of gold bearing quartz veins and areas of pervasive silicification all within a major SE-NW regional structure that is clearly evident on regional government airborne magnetic data.
Previous soil and rock sampling programmes have identified areas of gold anomalism, and the flat and easily traversed terrain and nature of soil development suggest the area to be amenable to very cost-effective exploration techniques.
The project is early stage but demonstrates lithological and structural components necessary for the development of gold and silver mineralisation.
The project and the terms of the JV agreement are in line with the company’s strategic plan of gaining access to very large parcels of highly prospective exploration ground in proven geological provinces, in safe, mining friendly jurisdictions, near to existing mines, at low cost.
With no upfront payments, a low commitment for the first phase, and a low-cost path to 100% ownership, El Pantano provides the company a substantial foothold in one of the world’s major gold provinces, with near term exploration plans able to be funded within the constraints of the company’s existing balance sheet.
Orosur CEO, Brad George, commented: “Signing of the El Pantano JV is the end result of a long period of negotiation and due diligence. A strong balance sheet, abatement of the COVID pandemic and the freeing up of our highly skilled South American commercial and geological team after the Anzá handover has provided Orosur an unique opportunity to examine new projects in key regions. The addition of El Pantano to Ariquemes, and our flagship project at Anzá, has transformed Orosur into a well-balanced, South American mineral explorer with an exciting future.”
Read the article online at: https://www.globalminingreview.com/exploration-development/15022022/orosur-mining-provides-argentina-update/
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