The first drill hole on the Huancaylla property in Peru has returned a 380.6-ft. intersection grading 1.13% copper, starting at surface.
The hole was abandoned because of lost circulation at 380.6 ft. in mineralization grading 1.36% copper and 0.017 oz. gold per ton. Cyprus Amax Minerals (NYSE) is earning a half interest in the property from Southwestern Gold (TSE) by funding all exploration, as well as completing a bankable feasibility study. Cyprus must pay Southwestern US$5 million if the property does go into production, and it can buy an additional 20% interest by financing all development costs and paying Southwestern a further US$7.5 million.
Southwestern discovered copper-gold mineralization on the property during a regional exploration program. Mineralization is hosted in limestones covered by thin overburden, and rock chip sampling pits covering an area measuring 3,000 ft. by 1,600 ft. returned an average of 2.04% copper, 0.76 oz. silver and 0.012 oz. gold. Geophysical surveys indicate the zone covers an even larger area.
Cyprus has two drill rigs operating on the property, and assay results from additional holes are pending.
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