Cornerstone options Newfoundland ground to major

A major copper producer plans to explore the Princess property on Newfoundland’s Bonavista Peninsula for its potential to host volcanic red-bed copper and/or epithermal porphyry copper-gold mineralization.

The Canadian arm of Phelps Dodge (PD-N) recently signed an joint-venture agreement to earn up to a 70% interest in the 72.25-sq.-km. property from Cornerstone Resources. While not yet listed on a Canadian exchange, the Newfoundland-based junior is a reporting issuer to the province’s securities division.

Cornerstone considers its exploration effort in Newfoundland “part of a pioneering effort,” because the search for red-bed copper is new to the region. Previous exploration typically focused on volcanogenic massive sulphides and gold, primarily in the central portion of the island.

“We got the property by grubstaking a local prospector who made the initial discovery,” said Glen McKay, chief operating officer. “We already had drill targets when Phelps Dodge took an interest in the display we had at the Atlantic Rock Room during last year’s PDAC [Prospectors & Developers Association of Canada] convention.”

Discussions between the two parties will culminate in an exploration option, share purchase and operating agreement, to be signed at this year’s PDAC convention. To earn its interest, Phelps Dodge must spend $2.5 million on exploration, make cash payments of $637,500 and invest a similar amount in the purchase of the junior’s shares.

The Princess property, situated within the Avalon zone, is underlain by a conformable sequence of undeformed, subaerial Late Precambrian clastic sediments and bimodal volcanics.

Several showings have been identified over the property, mostly within a 4-by-4-by-5-km area. Of particular interest, Cornerstone says, is a series of showings consisting of chalcocite and secondary copper minerals, which occur as disseminations and in quartz and quartz-carbonate veinlets hosted by mafic volcanics and clastic sediments. These showings are believed to be structurally controlled.

The junior holds several properties considered to have potential to host redbed copper deposits, and two of these are described as geologically similar to Princess. Exploration programs are planned for these and other properties this year under the direction of consulting geologist Christopher Hitchings.