Northern Orion firms up property holdings in Cuba and Argentina

With a treasury topped up by proceeds of a $40-million special warrant financing, Northern Orion Explorations (VSE) is in a healthy position to explore its Cuban and Argentine holdings.

The junior recently completed a 16-hole drill program on its 50%-held Delita gold property in Cuba. The program was carried out to confirm both the grade and thickness of the deposit, as well as provide a bulk sample for metallurgical tests.

The widely spaced holes tested 2,000 metres of strike length and returned an average grade of 4.19 grams gold and 33 grams silver per tonne over a true thickness of 12.7 metres.

A preliminary feasibility study estimates a geological resource of 18.9 million tonnes grading 2.87 grams gold and 22.7 grams silver. Within the resource are 4.7 million tonnes, minable by open-pit methods, grading 4.1 grams gold and 22 grams silver, as well as 1.9 million tonnes, minable by underground methods, grading 5.4 grams gold and 25 grams silver.

The Delita has been extensively explored and comprises three levels of underground workings.

A final feasibility study is expected this year, and preliminary work suggests the deposit could produce an annual 98,000 oz. gold and 560,000 oz. silver at an operating cost averaging US$190 per oz. gold over a mine life of 11 years.

Capital costs are estimated at US$45 million, with an additional US$8.7 million in contingency and US$6.2 million in indirect costs.

Northern Orion’s other Cuban project is its 50%-held Mantua copper-gold prospect. The property hosts a leached, gossanous cap containing a minable ore reserve of 2 million tonnes grading 1.44 grams gold and 11.5 grams silver. An underlying copper zone contains 15.2 million minable tonnes grading 1.35% copper, within a geological resource of 22.6 million tonnes averaging 1.01% copper.

Production is subject to a positive final feasibility study, which is expected to incorporate two years of gold-leaching, followed by nine years of copper mining.

In Argentina, at the company’s wholly owned San Jorge porphyry deposit, results from seven recent drill holes have extended the mineralization to depths of more than 300 metres, doubling the previously defined depth.

Results include: 302 metres of 0.37% copper and 0.22 gram gold for hole 8; 294 metres of 1.05% copper and 0.42 gram gold (including an interval grading 3.64% copper and 0.26 gram gold over 42 metres) for hole 9; 248 metres of 0.72% copper and 0.27 gram gold for hole 11; and 296 metres of 0.36% copper and 0.25 gram gold for hole 14.

Northern Orion is using information gleaned from the current 5,000-metre drill program to perform a prefeasibility study on San Jorge. A geological resource was previously estimated at 146 million tonnes grading 0.5% copper and 0.2 gram gold.

With a package of about 30 properties in Argentina, an important asset of Northern Orion is its 30%-held Aqua Rica project, situated in Catamarca province.

BHP Minerals holds the other 70% interest in the porphyry copper-gold project and is working to extend the deposit, which, to date, is defined over a distance of 1,800 metres in an east-west direction and 800 metres in a north-south direction. BHP is targeting a resource of more than 100 million tonnes containing copper, gold and molybdenum, with a grade exceeding 1% copper-equivalent.