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TODAY'S DISCOVERY, TOMORROW'S FUTURE
Creating shareholder wealth by advancing gold projects through the exploration and mine development cycle.
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my computer and typing skills are sub par at best, i think our internet comes through our barb wire fences and as that link didn't work for me, here is the story
major producers are now prepared to pay hard money for “potential” as opposed to drilled out reserves and resources of high grade gold
Goldcorp Takeover Of Andean Resources Spurs Interest In Argentina`S Santa Cruz Province
by Richard Badauskas
Goldcorp`s (NYSE:GG, TSX:G) friendly takeover of Andean Resources (ASX:AND, TSX:AND) for C$3.6 billion, topping an earlier bid by Eldorado Gold (NYSE:EGO, TSX:ELD, ASX:EAU), has intensified interest in Santa Cruz Province, often referred to as the Nevada of Argentina for its pro-mining environment and excellent potential for new discoveries.
Andean Resources’ principal asset is the Cerro Negro precious metals project, located in the Santa Cruz province of Argentina, which currently hosts an 43-101 compliant indicated and inferred resource of 3.1 million ounces of gold and 25 million ounces of silver.
The project is contained within an area of 215 km² and has developed partially drilled resources on three open vein systems at Vein Zone, Eureka and Baja Negro, with at least four additional targets under development and more postulated.
A recently completed preliminary feasibility study outlined the potential to produce 350,000 ounces of gold per year, at a cost of $200 per ounce, giving an IRR (Internal Rate of Return) of 40%. Capital costs came in at US$280 million, with all production sourced only from the Eureka and Vein zones.
Goldcorp says that Cerro Negro is a high grade, near surface system, that presents gold production at low capital cost that can be brought on stream quickly. They go on to say that the project is a world class epithermal system, with the potential to double or triple in size over a short development period. Simply based on the price paid, one can speculate that Goldcorp expect to do a lot better than they have indicated in their press release announcing the takeover proposal. This deal highlights the fact that major producers are now prepared to pay hard money for “potential” as opposed to drilled out reserves and resources of high grade gold.
The takeover also highlights the major potential within Santa Cruz to produce large gold and silver resources.
The main geologic feature in the province is known as the Deseado Massif which stretches over an area of 400 km x 240 km. In 1989 exploration work produced the first major discovery at Cerro Vanguardia vein field, hosting 7 million ounces of gold and 104 million ounces of silver, now controlled by a joint venture between AngloGold Ashanti (NYSE:AU) and Formicruz.
Since that time other groups have developed mines, with Coeur d’Alene (NYSE:CDE, TSX:CDM) at Mina Martha producing a total of 28,000 ounces of gold and 21 million ounces of silver to the end of 2009. Pan American Silver (NASDAQ:PAAS) putting the Mantial Espejo Mine into production, with resources of 0.4 million ounces of gold and 45.8 million ounces of silver, and Hochschild Mining (LSE:HOC) producing from the San Jose Mine, with 0.5 million ounces of gold and 33.4 million ounces of silver.
Corporate market valuations across the very lightly explored Santa Cruz province can vary dramatically based on results and the state of property development. Nonetheless, one of the company’s listed below could be the next Andean Resources.
Extorre Gold Mines (TSX:XG, OTCQX:EXGMF) is capitalized at C$400 million, and holds a high grade gold and silver project at Cerro Morro, which is located some 250 kms south west of Cerro Negro and has produced a NI 43-101 statement for 612,000 indicated gold equivalent ounces at 32.3 g/t and inferred 390,000 ounces of gold equivalent at 6.1 g/t. XG is planning to commence mining from open pit and underground resources at a rate of 100,000 gold equivalent (gold and silver) ounces per year, in late 2012. Multiple high grade targets have been defined for drilling within a 20 km² area and 4 drill rigs are running at a rate of 6,000 meters per month. XR has cash of C$15 million to support current drilling and development programs.
Patagonia Gold (AIM:PGD) is capitalized at £123.2 million and holds very prospective ground near Cerro Negro. PGD holds 7,351 km² of leases in Santa Cruz province and is the largest landholder in the area. The La Paloma block hosts the Lomada de Levia Project with NI 43-101 compliant resource of 235,073 ounces of gold. PGD plans a small heap leach to produce 21,000 ounces per year as it develops multiple targets and drills for definition of further resources. The nearby Cap Oeste Project (COSE) hosts a NI 43-101 compliant measured and indicated 655,930 ounces of gold equivalent resource with multiple open targets. Feasibility studies are planned for 2011 to 2012, with the intention of a start to mining in 2014. An additional project known as La Manchuria, located 50 kms from the planned mine plant is being drilled to produce an NI 43-101 compliant resource in the current quarter.
Mariana Resources (AIM:MARL) is capitalized at £34.5 million. MARL is an explorer in the early stages of developing a number of discoveries at Las Calandrias, where it is drilling out a large tonnage bulk mineable prospect contained within a 10.5km² volcanic structure. At Calandria Sur a major intersection recorded 102 m @ 1.2 g/t gold, and at Calandria Norte MARL is exploring bonanza silver and gold veins within a breccia trend identified over 450 meters and open in all directions. Multiple additional targets are scattered across the property. At Sierra Blanca MARL is drilling on high grade gold and silver veins, and is also drilling on targets at Los Amigos The company controls 160,000 hectares of leases throughout Santa Cruz.
De Grey Mining (ASX:DEG) is capitalized at A$12.4 million. DEG is a pure grass roots “green fields” explorer that has recently secured control of 14 projects contained within 2,200 km² of leases in Santa Cruz province. Projects were selected after aeromagnetic data and initial ground sampling identified structural corridors that may carry precious metals, including a project called Boleadora, which is located 30 kms from Cerro Negro, and covers 527 km². Sampling and mapping of outcropping mineralized breccias will commence in the next quarter and lead to selection of drill targets.
Other advanced exploration plays in the area are held by Minera IRL (TSX-V:IRL, LSE:MIRL) at Don Nicholas, which hosts an Indicated Resource of 1,078,000 tonnes at 5.8 g/t for 200,700 ounces of gold and an Inferred Resource of 1,075,000 tonnes at 4.6 g/t for 158,400 ounces of gold. Minera IRL picked up the asset through the acquisition of Hidefield Gold.
Hunt Mining (TSX-V:HMX) at La Josefina, Argentex (TSX-V:ATX, OTCBB:AGXM) at Pinguino, and Mirasol Resources (TSX-V:MR) at the Virginia silver vein field.
by Richard Badauskas
Goldcorp`s (NYSE:GG, TSX:G) friendly takeover of Andean Resources (ASX:AND, TSX:AND) for C$3.6 billion, topping an earlier bid by Eldorado Gold (NYSE:EGO, TSX:ELD, ASX:EAU), has intensified interest in Santa Cruz Province, often referred to as the Nevada of Argentina for its pro-mining environment and excellent potential for new discoveries.
Andean Resources’ principal asset is the Cerro Negro precious metals project, located in the Santa Cruz province of Argentina, which currently hosts an 43-101 compliant indicated and inferred resource of 3.1 million ounces of gold and 25 million ounces of silver.
The project is contained within an area of 215 km² and has developed partially drilled resources on three open vein systems at Vein Zone, Eureka and Baja Negro, with at least four additional targets under development and more postulated.
A recently completed preliminary feasibility study outlined the potential to produce 350,000 ounces of gold per year, at a cost of $200 per ounce, giving an IRR (Internal Rate of Return) of 40%. Capital costs came in at US$280 million, with all production sourced only from the Eureka and Vein zones.
Goldcorp says that Cerro Negro is a high grade, near surface system, that presents gold production at low capital cost that can be brought on stream quickly. They go on to say that the project is a world class epithermal system, with the potential to double or triple in size over a short development period. Simply based on the price paid, one can speculate that Goldcorp expect to do a lot better than they have indicated in their press release announcing the takeover proposal. This deal highlights the fact that major producers are now prepared to pay hard money for “potential” as opposed to drilled out reserves and resources of high grade gold.
The takeover also highlights the major potential within Santa Cruz to produce large gold and silver resources.
The main geologic feature in the province is known as the Deseado Massif which stretches over an area of 400 km x 240 km. In 1989 exploration work produced the first major discovery at Cerro Vanguardia vein field, hosting 7 million ounces of gold and 104 million ounces of silver, now controlled by a joint venture between AngloGold Ashanti (NYSE:AU) and Formicruz.
Since that time other groups have developed mines, with Coeur d’Alene (NYSE:CDE, TSX:CDM) at Mina Martha producing a total of 28,000 ounces of gold and 21 million ounces of silver to the end of 2009. Pan American Silver (NASDAQ:PAAS) putting the Mantial Espejo Mine into production, with resources of 0.4 million ounces of gold and 45.8 million ounces of silver, and Hochschild Mining (LSE:HOC) producing from the San Jose Mine, with 0.5 million ounces of gold and 33.4 million ounces of silver.
Corporate market valuations across the very lightly explored Santa Cruz province can vary dramatically based on results and the state of property development. Nonetheless, one of the company’s listed below could be the next Andean Resources.
Extorre Gold Mines (TSX:XG, OTCQX:EXGMF) is capitalized at C$400 million, and holds a high grade gold and silver project at Cerro Morro, which is located some 250 kms south west of Cerro Negro and has produced a NI 43-101 statement for 612,000 indicated gold equivalent ounces at 32.3 g/t and inferred 390,000 ounces of gold equivalent at 6.1 g/t. XG is planning to commence mining from open pit and underground resources at a rate of 100,000 gold equivalent (gold and silver) ounces per year, in late 2012. Multiple high grade targets have been defined for drilling within a 20 km² area and 4 drill rigs are running at a rate of 6,000 meters per month. XR has cash of C$15 million to support current drilling and development programs.
Patagonia Gold (AIM:PGD) is capitalized at £123.2 million and holds very prospective ground near Cerro Negro. PGD holds 7,351 km² of leases in Santa Cruz province and is the largest landholder in the area. The La Paloma block hosts the Lomada de Levia Project with NI 43-101 compliant resource of 235,073 ounces of gold. PGD plans a small heap leach to produce 21,000 ounces per year as it develops multiple targets and drills for definition of further resources. The nearby Cap Oeste Project (COSE) hosts a NI 43-101 compliant measured and indicated 655,930 ounces of gold equivalent resource with multiple open targets. Feasibility studies are planned for 2011 to 2012, with the intention of a start to mining in 2014. An additional project known as La Manchuria, located 50 kms from the planned mine plant is being drilled to produce an NI 43-101 compliant resource in the current quarter.
Mariana Resources (AIM:MARL) is capitalized at £34.5 million. MARL is an explorer in the early stages of developing a number of discoveries at Las Calandrias, where it is drilling out a large tonnage bulk mineable prospect contained within a 10.5km² volcanic structure. At Calandria Sur a major intersection recorded 102 m @ 1.2 g/t gold, and at Calandria Norte MARL is exploring bonanza silver and gold veins within a breccia trend identified over 450 meters and open in all directions. Multiple additional targets are scattered across the property. At Sierra Blanca MARL is drilling on high grade gold and silver veins, and is also drilling on targets at Los Amigos The company controls 160,000 hectares of leases throughout Santa Cruz.
De Grey Mining (ASX:DEG) is capitalized at A$12.4 million. DEG is a pure grass roots “green fields” explorer that has recently secured control of 14 projects contained within 2,200 km² of leases in Santa Cruz province. Projects were selected after aeromagnetic data and initial ground sampling identified structural corridors that may carry precious metals, including a project called Boleadora, which is located 30 kms from Cerro Negro, and covers 527 km². Sampling and mapping of outcropping mineralized breccias will commence in the next quarter and lead to selection of drill targets.
Other advanced exploration plays in the area are held by Minera IRL (TSX-V:IRL, LSE:MIRL) at Don Nicholas, which hosts an Indicated Resource of 1,078,000 tonnes at 5.8 g/t for 200,700 ounces of gold and an Inferred Resource of 1,075,000 tonnes at 4.6 g/t for 158,400 ounces of gold. Minera IRL picked up the asset through the acquisition of Hidefield Gold.
Hunt Mining (TSX-V:HMX) at La Josefina, Argentex (TSX-V:ATX, OTCBB:AGXM) at Pinguino, and Mirasol Resources (TSX-V:MR) at the Virginia silver vein field.
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