Southwestern Resources (SWG-T) has inked a deal to sell its 50% stake in the Poracota gold property in Peru to Compania de Minas Buenaventura FOR $7.15 million over three years.
Teck Cominco (TEK-T) holds the remaining half-interest in the property, which lies 15 km west of Buenaventura’s Orcopampa mine, which produces 150,000 oz. of gold per year.
Under the deal, Buenaventura has paid Southwestern $159,000, and will make staged payments of $318,000, $477,000 and $6.2 million over the term of the agreement.
Buenaventura also has an option to pick up another 25% of the project from Teck Cominco for an additional US$3 million over 3 years. The company has committed to spend at least US$400,000 in the first year of the option, and must spend no less than US$1 million in the second year and US$1.6 million in the third year to maintain its option.
Poracota is situated 160 km northwest of Arequipa. Numerous zones of gold-rich pyrite mineralization and native gold have been identified in a hydrothermally altered 35-sq-km area with the margins of a volcanic collapse structure or caldera.
So far, four zones — Poracota B, Sombreruni, C Zone and Puma, have been found to contain gold values in excess of 1 gram gold per tonne at surface.
Widely spaced drilling on Poracota B has defined an inferred resource of 14.5 million tonnes running 2.26 grams gold in an interpreted stratabound, gold-bearing lens. The lens is hosted by a thicker 30-to-100-metre alteration zone, one of several stacked zones said to have potential to host significant gold values. The gold mineralization is open down dip and along strike to the south.
To the south 4 km, at the Puma zone, limited sampling returned an average gold grade of 1.3 grams, with the highest value hitting 3.8 grams. Gold mineralization is hosted by highly silicified volcanic breccias exposed over a vertical extent of 50 metres.
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