Noranda cuts copper-gold

Drilling by Noranda (NOR-T) has encountered significant copper-gold mineralization at the El Morro porphyry property in north-central Chile.

The major, which can earn a 70% interest in the property from Metallica Resources (mr-t), intersected 70 metres of chalcocite mineralization averaging 1.15% copper and 0.35 gram gold per tonne. The hole was drilled in the La Fortuna zone as part of a 4,300-metre, 16-hole program. Three additional holes at La Fortuna averaged 0.48% copper over 58 metres of chalcocite mineralization.

Eleven of the 16 holes were drilled in the El Morro area, where previous drilling by Metallica cut 192 metres of 0.77% copper and 0.29 gram gold. Although Noranda was unable to duplicate the intercept, it did intersect persistent secondary chalcocite mineralization grading between 0.2% and 0.5% copper over widths of up to 200 metres.

The remaining holes were drilled in the Camp zone, near La Fortuna, and encountered only anomalous mineralization.

In all, Noranda failed to intersect any porphyry-style mineralization, though it intends to continue drilling in the next field season.

The Toronto-based major is required to pay US$300,000 in cash by Sept. 1, 2000, in addition to exploration expenditures. As well, it has agreed to spend at least US$1 million on exploration and buy US$1 million in Metallica shares before Sept. 1, 2001, and spend US$3 million per year in the three following years. By Sept. 1, 2005, Noranda must make a final cash payment of US$10 million and complete a feasibility study.