History
Modern day exploration work in the Cajamarca mining region dates back to the 1983 joint venture between BRGM and Newmont Mining Corporation that led to the discovery of the Yanacocha deposit. Yanacocha started production in 1993 and quickly became, and has remained, South America’s largest gold producer.
Colpayoc Project Exploration History
The first known exploration programs over the Colpayoc area were completed between 1994 and 1998 by Newcrest Peru S.A. (“Newcrest”), Granges Inc. (“Granges”), and Balaclava Mines Inc. (“Balaclava”). From 2007 to 2013, Estrella Gold Corporation (“Estrella”) conducted an exploration program on the Colpayoc property that provided the basis for two NI 43-101 technical reports stating a mineral resource: 1) the SRK Report (2010) (“SRK Report”); and 2) the Turner Report (2011) (“Turner Report”). Exploration programs conducted by these previous operators were focused on three zones: Daylight (previously known as the Northern Porphyry), Montura (previously known as the Southern Porphyry) and Rayo Grande.
Colpayoc Historic Drill Programs
Newcrest, Balaclava and Estrella conducted drilling campaigns at Colpayoc totaling 3,600 meters of core drilling (Newcrest and Estrella) and 500 meters of reverse circulation (“RC”) drilling (Balaclava). The Au-porphyry occurrence in the Daylight Zone was the primary target of these drill campaigns.
Geology and Mineralization
Regional Geology
The El Ferrol Claim, formerly part of the Colpayoc Project, lies on the Miocene metallogenic belt of central and northern Peru which extends more than 900 km along the Cordillera Occidental. Most of the mineral occurrences along this belt of deposits are hosted by shelf carbonates and clastic sedimentary rocks of Mesozoic age and by overlying volcanics and coeval intrusive rocks. Base- and precious-metal mineralization was closely associated with the eruption of calc-alkalic volcanic rocks and emplacement of coeval dikes and stocks of Miocene age.
The Cordillera Occidental follows the northwesterly Andean structural trend through the Department of Cajamarca as shown by faults, fold axes and a linear trend of eight porphyry deposits along a 100 km extent from Michiquillay to La Granja. The northeasterly-trending Yanacocha-Chicama Structural Corridor is defined by an alignment of structural elements that includes the Yanacocha Mine complex.
The geology of this segment of the Cordillera Occidental in northern Peru features a sequence of Mesozoic marine sedimentary rocks measured at more than 2,000 meters thick overlain by a thick and extensive sequence of volcanic rocks of the Calipuy Group of Eocene to late Miocene age. The area of volcanic rocks includes several volcanic fields of pyroclastic, flow and domal rocks of rhyolitic to andesitic composition including the nearby Yanacocha Volcanic Field. Most of the volcanic rocks are widely altered in the vicinity of the region’s numerous mineral deposits and mining operations.
The Cajamarca region hosts multiple porphyry and epithermal deposits located along the Chicama-Yanacocha Structural Zone, a major control on magmatic activity in the region. The Yanacocha mine complex is the most prominent of these; the Colpayoc property lies 15 km southwest of the nearest Yanacocha deposit.
Geology of the El Ferrol Claim
Geology of the Yanacocha District, Department of Cajamarca (INGEMMET, 1998)
The El Ferrol Claim, formerly part of the Colpayoc Project, is underlain by a Cretaceous marine sedimentary sequence including massive, thick bedded limestone in outcrop which has been folded into a northwest trending syncline verging both northwest and southeast.
Folding was followed by, or contemporaneous with, a mid-Miocene magmatic event that emplaced a granodioritic intrusive complex into the limestone sequence. Ground magnetics outline an area roughly two kilometers in diameter that indicate the intrusive is present at depth underlying much of the southern portion of the property. Historic scout drilling by Newcrest demonstrates that some areas along the perimeter of the magnetic anomaly (granodiorite intrusion) have formed exoskarn alteration in the host limestone.
Geology of the Colpayoc Project, Cajamarca District, Peru. (From Turner, 2011; map does not represent current property limits)
Deposit Type
The Colpayoc property hosts gold (copper) porphyry deposits with associated skarn and replacement mineralization that is typical of the metallogenic environment in northern Peru. The porphyries of the Cajamarca region occur as a series of high-level intrusive apophyses and related zones of tectonism and brecciation that have been exposed to hydrothermal solutions and emplacement of multiple zones of stockwork fractures.
The Colpayoc property porphyry system is similar to gold-enriched porphyry systems found throughout northern Chile, Peru and Colombia. The Cerro Corona Au-porphyry (Goldfields) and Michiquillay Cu-Mo-Au porphyry (Southern Copper) are both within a 40-kilometer radius of Colpayoc. Michiquillay contains >1,100 million tonnes at 0.57% Cu, 0.013% Mo and 0.07 g/t Au (ProInversión, 2015). A zone with the highest average gold grades (0.35 g/t Au) is associated with high copper grades (0.9 – 1.0% Cu). (Note: proximity to these known porphyry deposits is not necessarily indicative of the mineralization found on the Colpayoc property.)
Transaction and Royalties
The titleholder of concession ‘El Ferrol No. 18’ is Sociedad Minera Chetilla S.R.L., a Peruvian corporation (the “El Ferrol Owner”). The Company, through its Peruvian subsidiary Mineros Invirtiendo en Peru S.A.C., has an exclusive earn-in agreement (the “El Ferrol Agreement”), signed July 24, 2021, to acquire a 100% interest in this concession by making an aggregate payment of $250,000 in the following amounts on or before the following dates:
- $50,000 following the date of registering the El Ferrol Agreement (the “Effective Date”); (PAID)
- $50,000 one (1) year from the Effective Date; (PAID)
- $75,000 two (2) years from the Effective Date; (PAID) and
- $75,000 three (3) years from the Effective Date. (PAID)
(All amounts are USD unless otherwise stated.)
In addition, upon acquisition of the earned interest, The Company shall be deemed to have granted the owner a one percent (1%) net smelter returns (the “El Ferrol Royalty”) from the ‘El Ferrol No. 18’ concession but is is entitled to (but not required to) buy back the full El Ferrol Royalty within nine (9) years after acquisition by making a payment of $500,000 to the El Ferrol Owner.
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