Southwestern Gold active in Argentina, Peru

Denver — Faced with the impending South American winter, partners Southwestern Gold (SWG-T) and Consolidated Jaba (JBA-V) are hurrying to complete soil sampling on the Tecka layered mafic intrusion in southern Argentina’s Chubut province.

The joint venture has collected more than 1,500 samples in an attempt to find platinum-palladium mineralization similar to the Stillwater complex in Montana and the Bushveld complex in South Africa. The partnership consists of 1,918 sq. km of exploration concessions and 875 sq. km of concession applications. The Argentine government, in a recent study, has established the presence of platinum group metals in the area.

Situated in the Patagonia region, Tecka is more than 100 km long and up to 3 km thick, making it one of the largest unexplored intrusions on the continent. And although poor outcrops are hampering the investigation, field investigations indicate an east-dipping intrusive complex that includes a basal ultramafic zone, a transitional zone, and a more mafic upper zone. Ultramafic rocks consist of peridotite and pyroxenite, whereas the maffic complex is dominated by gabbro and by lesser anorthosite and norite.

Sulphide mineralization appears to be widespread, though the most significant zone was found in the transition between the ultramafics and mafics in the central portion of the complex, where fine-grained layered sulphides contain chalcopyrite and pyrrhotite.

More recently, a second sulphide zone was discovered higher in the sequence. The partners are currently awaiting results from trenching and sampling in the area.

Southwestern can earn 71% of the project by spending US$3 million over three years, though, at present, Jaba controls 55%, and Southwestern, 45%.

Meanwhile, Southwestern is busy exploring several projects in southern Peru.

– Winter — Drilling will soon begin at the Winter project, which has already been subjected to an induced-polarization survey. The 2,900-ha project is held jointly with Southern Peru Copper (PCU-N), which can earn a 65% interest by spending US$630,000 on exploration over four years and paying US$1 million to Southwestern.

– Los Chancas — At the adjacent Los Chancas property, Southwestern has outlined a resource of 200 million tonnes averaging 1% copper and 0.07% molybdenum, plus 0.12 gram gold per tonne. Mineralization consists of a supergene chalcocite blanket overlying primary sulphides, including chalcopyrite and bornite. A prefeasibility study is under way.

– Minaspata — Drilling is also planned for the Minaspata gold project, which is equally owned by Southwestern and Cambior (CBJ-T), though Barrick Gold (ABX-N) has an option to earn 51% by spending US$1.5 million on exploration over three years and paying US$500,000 in cash. The major can boost its stake to 60% by funding a bankable feasibility study. To date, three high-sulphidation gold targets have been defined by field sampling.

– Bambas West — The year’s work at the Bambas West project, a 50-50 joint venture with Inco (N-T), will concentrate on two zones of copper-zinc mineralization. Inco will cover the next US$1 million in exploration expenditures, which will consist of trenching and ground geophysics.

The two targets — Minascassa and Lince — are in the northwestern extension of the Tintaya-Bambas porphyry-skarn belt. The Minascassa skarn, which measures 5 km in length, is hosted in limestones adjacent to a high-level quartz-feldspar porphyry. Sampling ranges up to 9.1% zinc and 1.2% copper.

The Lince target contains zinc mineralization that can be traced for more than 2.7 km in two zones. In the northern part of the property, mapping has outlined 1,500 metres of replacement mantos, whereas the southern zone contains a 1,200-metre body of zinc-copper mineralization with values of up to 8.5% zinc.

– Accha — At the Accha zinc project, Southwestern and partner Pasminco have reached the prefeasibility stage, and further metallurgical tests are planned.

The Australian company can earn a 51% interest in the project in return for spending US$5 million by May 2002. To date, it has spent US$3.1 million and outlined an indicated and inferred resource of 9 million tonnes grading 9% zinc. The mineralization consists of oxides and has been deemed minable by open-pit methods; also, previous metallurgical tests indicate recoveries of 90% can be achieved by heap leaching.

The partners intend to expand the resource to the west, where one drill hole encountered 24.2 metres grading 8.8% zinc at a depth of 280 metres.

– Puno — At the Puno gold project, Southwestern’s partner is Newmont Mining (NEM-N), which is spending US$1.5 million on exploration to earn a half-interest. Drilling is to begin soon.

Southwestern owns a 45.6% stake in diamond explorer Canabrava Diamond (CNB-V) and 19.1% of Aurora Platinum (ARP-V). The latter is active in Ontario and Quebec.