Proceeds from a private placement are enabling
In late July, Far West became a market sensation after announcing the intersection of 60 metres averaging 2.47% copper and 0.33 gram gold per tonne. News of the discovery sent the stock soaring to $1.50 before the day’s close and, by presstime, another 77 had been tacked on, for a 6-week gain of 203%.
Banking on its newfound stardom, Far West has issued 6.2 million units at $1.30 apiece to raise gross proceeds of $8.1 million. When the financing was announced, the company was trading in the $1.60 range, accounting for the settlement price. A unit consists of a share and half a warrant, with a full warrant entitling the holder to buy another share for one year at $1.75, for a possible $5.4 million more in proceeds.
Net proceeds are earmarked for Candelaria, which covers 4,686 sq. km of the metallogenic belt after which it is named. Among the belt’s notable claims to fame is the Mantoverde deposit of
Under terms of an agreement with
Recently, Far West has been focusing on the 4c3, 4c9, 4d1, 4b1 and 4b3 areas, where broad gravity or magnetic highs were outlined in earlier airborne surveys. The mineralized interval itself came from 4c3, west of old mine workings, along the vertically dipping and north-trending Santa Teresita fault.
Geologically, the 4c3 area is underlain by hornfelsed volcanic rocks that are intruded by mafic-to-felsic plutons and dykes. The noted interval is in the intrusive rocks, which are altered to quartz, carbonate and sericite.
Mineralization begins 28 metres down and continues in oxides, which end at 120 metres downhole. About half the interval is a mixture of specular hematite, magnetite, limonite, chalcocite, copper oxides, quartz-veining and traces of chalcopyrite and bornite. The copper oxides are abundant in fractures but are also disseminated in the host rock, and individual grades vary from 0.27% to 15.25% over the 2-metre composite intervals; only one composite exceeded a gram of gold, averaging 1.37.
Two other holes, collared 705 and 1,700 metres north of hole 1, returned anomalous values only. The closer hole also pulled up strong quartz-sericite-carbonate alteration.
Far West likens the geological setting to Mantoverde, where copper mineralization is associated with specular hematitic breccia in a zone of brittle faulting belonging to the Atacama fault. The Atacama structure is associated with many iron-oxide deposits in the country.
At Target 4c9, which extends directly northeast of 4c3, three holes intersected zones of potassic and quartz-sericite alteration with associated pyrite and chalcopyrite. Copper assays ran up to 0.31% across 2 metres of core.
Results from four holes drilled at the 4d1 target were somewhat better, with 4 metres of one hole yielding 2.94% copper. Iron- and copper-oxides also are notable in several mine workings found in the area.
The 4d1 anomaly is associated with a splay off the Atacama fault, due south and on-trend with the fault system at Mantoverde. The splay is characterized by a broad package of mylonites.
Three holes drilled at the 4b1 and 4b3 targets intersected a sequence of intercalated calcareous sedimentary rocks and volcaniclastics, but results were disappointing. The best result came from the latter area, where 0.23% copper over 2 metres of disseminated copper was pulled from drilling.
Widespread “earthy” hematite is the predominant alteration mineral.
The 4b1 and 4b3 targets lie southeast of the historic Santo Domingo iron-oxide copper-gold district.
An upcoming drill program will focus on the 4c target areas.
In return for underwriting the placement, First Associates Investments, Canaccord Capital and Haywood Securities have been paid a 6.5% commission from the gross proceeds. First Associates is the lead underwriter.
The securities are subject to a 4-month hold period, meaning none can be traded on the open market until mid-January.
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