Corner Bay acquires Arizona copper play

Corner Bay Minerals (TSE) is acquiring the Korn Kobb copper property in Arizona by making option and acquisition expenditures and paying a residual royalty on production to the vendor.

Corner Bay has, in turn, optioned 49% of the property to Gold Giant Minerals (VSE).

Korn Kobb is a 57-claim oxide copper property 35 miles northeast of Tucson and 20 miles south of the San Manuel mine. Reserves are in the order of 28 million tons grading 0.41% copper. Included in this amount are about 10 million tons of 0.47% copper (using a cutoff of 0.27% copper) which are minable by open-pit methods. The stripping ratio for the minable oxide reserve is 0.7-to-1.

Previous metallurgical tests suggest cathode copper can be produced by low-cost, open-pit mining plus heap leaching and solvent

extraction-electrowinning.

During a 15-month option period, Corner Bay must complete drilling and produce a feasibility study. It will be required to pay $40,000 upon signing the deal, followed by a further $40,000 within six months and a final $40,000 within one year. During the final month of the option period, if the company elects to proceed with the project, it must make acquisition payments of $50,000 quarterly for four years, for a total acquisition cost of $800,000. Royalty payments on production will also be required of Corner Bay, with the amount subject to changes in copper prices.

Corner Bay’s deal with Gold Giant allows the latter to earn a 49% interest by paying the vendor $80,000 and spending US$1 million on the property over the next 12 months. Corner Bay would be operator with a 51% interest.

Meanwhile, Magma Copper (NYSE) will begin drilling on the Cerro Verde copper property in Mexico’s Sonora state this summer. If Magma spends $1 million on exploration, completes a feasibility study and pays Corner Bay $300,000 over five years, the two companies will form a 50-50 joint venture to develop and mine the deposit.