New estimate boosts oxide copper resource at Apoquindo

Vancouver – A concerted drilling effort by Apoquindo Minerals (AQM-V) has increased the resources at its namesake copper oxide project in Chile by some 30%.

The Apoquindo project consists of two deposits, Elenita and Madrugador, that are 18 km apart in the Antofagasta coastal range of northern Chile. In 2008 Apoquindo punched 140 holes totalling 22,380 metres into Madrugador and 128 holes totalling 20,590 metres in Elenita.

The $11-million effort has now paid off in a new resource estimate. Together, Elenita and Madrugador host 31.93 million measured and indicated tonnes grading 0.8% copper as well as 6.21 million inferred tonnes grading 0.7% copper, using a 0.2% copper grade cut-off. The new resource boosts Elenita’s resource count by 41% and increases Madrugador’s resources by 17%.

Apoquindo also calculated the tonnage and grade of an in-pit resource at each site. Using a copper price of US$1.50 per lb., an Elenita pit holds 17.29 million tonnes grading 0.92% copper. A US$1.50 per lb. copper pit at Madrugador contains 9.63 million tonnes averaging 0.7% copper.

After drilling 15 twin holes at Elenita to validate historical data, Apoquindo drilled another 113 holes expanding the deposit to the south, east, and northeast. The deposit is amenable to conventional open-pit mining but underground methods may be more appropriate for its deepest portions, especially since historical underground workings already exist.

At Madrugador, Apoquindo’s first 21 holes validated data from historical drill holes. The rest of the 140-hole program expanded and selectively infilled missing areas at Madrugador Sur, then developed new mineralized zones including Madrugador Norte and Brac II. The deposit remains open in several directions and at depth.

Both Elenita and Madrugador are manto-style deposits, which are typical to the Antofagasta region. Hydrothermal solutions flowing from dioritic dikes and sills emplaced stacked mantos and hydrothermal breccias in andesitic volcanic and volcaniclastic horizons of Jurassic age. There are several medium and large stratabound copper deposits near Apoquindo that are in production, including Anglo American’s (AAUK-Q, AAL-L) Mantos Blancos mine and Antofagasta Minerals’ Michilla mine.

Apoquindo is now using reverse circulation drill samples for metallurgical testing, conducting bottle and column tests. As soon as these results are available the company plans to complete a scoping study for the oxide project. The company believes Apoquindo already hosts sufficient resources to sustain 15,000 to 20,000 tons of annual copper cathode production over some ten years.

In the three days following news of the increased Apoquindo resource the company’s share price gained 15¢ to close at 37¢. Apoquindo has a 52-week trading range of 22¢ to $1.45 and has 34 million shares outstanding.

The company also managed to re-negotiate its purchase agreement for Elenita, reducing its 2009 payments to US$1 million from US$4.2 million. The US$3.2-million difference has been deferred to late 2010 and 2011.