Alacrán Project (AZS 100%): Silver-Gold-Copper
Teck resources earning initial 51% interest with right to go to 65% interest
Azure Minerals earned a 100% interest in the Alacrán Project between 2015 to 2016 from Minera Teck S.A. de C.V. (Teck), a 100%-owned subsidiary of Canada’s largest diversified resource company, Teck Resources Limited.
Teck exercised its claw-back right in December 2016, is currently earning back into the project and is the project operator. Work conducted during 2017 and 2018 represent the first two years of activity in a total four-year program comprising the first Option which will entitle Teck to earn back a 51% share of the project by sole-funding US$10 million of exploration expenditure, and making cash payments to Azure totalling US$500,000.
Upon reaching an initial 51% interest in the project, Teck may exercise the second Option to further increase its interest to 65% by sole funding an additional US$5 million in expenditures over a further two years, and making cash payments to Azure totalling an additional US$1.5 million. In this case, Azure will retain a contributing 35% interest in the Alacrán project. Grupo Mexico retains a 2% NSR royalty.
Alacrán is ideally located within the Laramide Copper Province, North America’s most prolific copper-producing district, and is close to several large operating copper mines, including being only 12km from the world class, giant Cananea Copper Mine. Alacrán offers significant potential for hosting large porphyry copper deposits (Teck’s principal focus) and high-grade precious metal deposits.
Azure’s exploration work on the project in 2015 and 2016 discovered two significant epithermal silver and gold deposits – Mesa de Plata and Loma Bonita – which together host resources of 32Moz silver and 150,000oz gold.
Mesa de Plata
Silver mineralisation at Mesa de Plata is hosted in flat-lying, silicified volcanic rocks and residual quartz (vuggy silica) which form a prominent ridge. Mineralisation starts at surface with true thicknesses of up to 60 metres and extends throughout the deposit with excellent internal continuity.
The JORC Mineral Resource, 100% of which is in the Measured and Indicated categories, comprises 27.4 million ounces of silver, with the near-surface High Grade Zone containing 15.5 million ounces of silver at a grade of 275g/t.
Table 1: Mesa de Plata Mineral Resource (ASX: 1 December 2016)
The Loma Bonita silver-gold deposit is located 200 to 500 metres east of the Mesa de Plata silver deposit. Significant widths of silver and gold mineralisation are hosted in silicified volcanics and vuggy silica, commencing at or near to surface. The JORC Mineral Resource comprises approximately 5Moz of silver and 150,000oz of gold and mineralisation remains open in all directions.
Table 2: Loma Bonita Mineral Resource (ASX: 21 December 2016)
At Cerro Alacrán historical and recent drilling, has intersected significant widths of supergene and primary copper mineralisation, demonstrating that potential exists for the delineation of a large, porphyry-associated copper deposit.
To date, drilling (33 historical and 16 recent diamond core holes) has tested an area of approximately 1,500m x 1,000m, with most holes intersecting supergene copper mineralisation and some deeper holes entering into the primary mineralisation zone. Supergene mineralisation consists of copper oxides and chalcocite and the underlying primary sulphide mineralisation is predominantly chalcopyrite.
The overall size and grade and the areal and depth extents of the Cerro Alacrán supergene and primary copper mineralisation are yet to be defined, remaining open and untested in all directions and at depth, and further drilling is required.
The confirmation of significant widths of copper mineralisation at Cerro Alacrán in a district which hosts many large copper mines and deposits, supports Azure’s belief that this prospect is significantly underexplored and that further exploration, including geophysics and additional drilling, will identify more mineralisation.