Alturas heavy on exploration expertise in Peru

Alturas Minerals (ALT-V) swept into Toronto recently looking to draw the Street’s attention to Peru.

Last year’s electoral defeat of socialist presidential candidate Ollanta Humala to the more market-friendly Alan Garcia removed a significant obstacle in raising foreign capital, and it’s an advantage that Alturas — a junior exploring for gold in the country — is eager to capitalize on.

“Things have improved with the new government,” Alturas president and chief executive Miguel Cardozo says. “They’ve shown they will support investment, especially in mining.”

Paul Pearson, vice-president of exploration, says the new government has made massive strides on building infrastructure. That not only helps the industry in terms of logistics, but also with community relations, as now, perhaps more than ever, citizens are seeing the benefits of fostering a healthy mining industry.

Alturas would appear to be in a strong position to take advantage of the more stable environment.

In Cardozo, the company has a man at the helm with a deep understanding of Peruvian culture, but also, importantly, Peruvian geology.

Cardozo, a Peruvian, has the distinction of heading the Newmont Mining (NMC-T, NEM-N) exploration team that discovered Yanacocha — the largest gold resource in Latin America with over 60 million oz. gold.

With Alturas, he’s hoping to strike gold twice, and has used his knowledge of the land to acquire an array of properties that he thinks have the best chance to be the Americas’ next big find.

“We were ahead of all the exploration activity that intensified in the last couple of years because we’re a Peru-based company,” Cardozo says.

The company has three key projects that it will be zeroing in on this year: Huilacollo, Banos del Indio, and Utupara.

At Huilacollo, Alturas has just finished drilling 3,000 metres to test geochemical and geophysical targets. The project is situated roughly 970 km southeast of Lima and is described as a high-sulphidation epithermal gold system outcropping over a strike length of roughly 5 km.

Trench sampling yielded 38 metres grading 6.69 grams gold per tonne and near-surface intercepts of 1.24 grams gold over 84 metres.

Such high-sulphidation epithermal systems can be profitable at grades less than 1 gram gold, Alturas says, because they can be mined by open-pit methods and the dominantly oxide ore is heap leachable. That’s especially true in Peru, which hosts some of the lowest cash cost operations in the world.

Banos del Indio is also a high-sulphidation epithermal system, located 980 km southeast to Lima. There, rock chip sampling has returned values as high as 20.97 grams gold per tonne.

The best intersect from previous reverse-circulation drilling is 6.1 metres grading 10.7 grams gold, but no follow-up drilling has been done on the property since 1994.

Alturas will change all that with its plans to drill 2,000 metres in the first half of 2007.

Utupara, the final project targeted by Alturas for drilling, lies in the same Eocene-Oligocene copper-gold belt that hosts such deposits as Xstrata’s (XSRAF-O, XTA-L) Las Bambas and Southern Copper’s (PCU-N) Los Chancas.

Alturas says three different styles of mineralization have been delineated at Utupara: porphyry copper-gold, skarn and structurally controlled gold hosted by quartzite.

Rock chip sampling there has detected strong copper and gold anomalies over a 2.5 by 2.5-km area. The company plans to drill 3,000 metres in the first half of 2007 provided it receives all regulatory and social permits.

With the lion’s share of the roughly $3.4 million in the kitty going into the ground, the company should have a firmer grip on what it has underfoot by September.

“Once we have the results (from all three properties) we have to rank the projects and see which will get the most of our attention,” Cardozo says.

Adds Pearson: “That’s our philosophy and it’s proven successful in the past; choosing the best project and focusing on it.”

And if one of the projects turns out to be the next Yanacocha, will the team be interested in turning its exploration hats in for mining helmets?

“We’re exploration geologists, that’s what we do. We’ll leave the mine development to the mining engineers,” Pearson says.

With 33 million shares outstanding, Alturas’ shares traded recently at 48 in Toronto in a 52-week range of 44-78.