Noranda keeping busy at El Morro

Noranda (NRD) is continuing its exploration efforts at Metallica Resources‘ (MR-T) El Morro copper-gold prospect in northern Chile.

The El Morro property contains three separate areas of copper-gold porphyry style mineralization: El Morro, La Fortuna and El Negro.

In September, Noranda released the first resource estimate for El Morro, delineating an inferred resource in the La Fortuna area of 410 million tonnes grading 0.61% copper and 0.56 gram gold per tonne (5.5 billion lbs. contained copper and 7.4 million oz. contained gold), using a cut-off grade of 0.4% copper.

Metallica reports that additional remote-sensing imaging combined with magnetic and induced-polarization surveying have identified several more exploration targets that “could have a major impact on the potential economics of the project, should they represent additional porphyry style mineralization.”

Noranda has slightly revised its focus for a drilling campaign that is due to get underway in January and will centre on the La Fortuna area.

The company will test for: an extension of La Fortuna to the north, northwest and at depth with about 6,000 metres of diamond drilling; known mineralization and geophysical targets that remain open on the El Negro area with about 1,500 metres of diamond drilling; and new remote-sensing and geophysical targets with about 5,000 metres of reverse-circulation drilling.

Noranda may also carry out follow-up drilling on the above targets, if the results warrant it.

Metallica also reports that an Environmental Impact Declaration for the El Morro project was submitted to the Chilean authorities in October, and that it has received notice that Chile’s supreme court has found in favor of Metallica in its ownership dispute over a small portion of ground acquired by Metallica in 1998 through staking.

Metallica now unconditionally controls this disputed ground, which is included in the option agreement with Noranda.

Noranda can earn a 70% interest in the El Morro property by spending US$10 million on exploration and paying US$10 million to Metallica by September 2005. The major may be required to provide 70% of Metallica’s share of development costs at an interest rate of Noranda’s cost of financing plus 1%.