Drill Program Commences on Campo Viejo Argentine Silver Prospect
Salta Exploraciones SA (SALTA), a 50% owned subsidiary of Cascadero Copper, entered into an option agreement with Silex Argentina (SILEX), a 100% owned subsidiary of Golden Minerals Company (AUM-TSX; GDMN.PK) regarding a property called Campo Viejo. In early August 2009, Golden Minerals initiated a 1,100 metre core drilling program at Campo Viejo to test several surface mineralized structures to determine continuity of surface mineralization to depth. Exploration by SALTA on Campo Viejo was carried out from 2005 to 2007. The property consists of 3,000 hectares and is located in northwestern Argentina approximately eight kilometres north of and adjoins Golden Minerals' El Quevar Project, part of which, Castro-Quevar is also subject to an option agreement between SALTA and SILEX. See Cascadero news release dated August 24th 2009.
Campo Viejo is hosted within the core of the Quevar stratovolcano complex in the eastern part of the regionally extensive Nevado de Quevar caldera complex. Grey dacite and andesite occupies the margins of the stratovolcano, and its core region is underlain by volcanic and hypabyssal quartz-eye, biotite with feldspar dacite. The dacitic rocks occur mainly as pyroclastics, with flows dykes and domes.
The central part of the Quevar stratovolcano is underlain by an high-sulphidation alteration and mineral system that measures some 10 km north-south and to 5 km east-west. The whole of the upper parts of the high-sulphidation alteration assemblage is exposed in over a 1,000 metre cross-section in the central part of Quevar. The highest levels of the mountain are underlain by kaolin, massive to porous alunite, opal and native sulphur that represent the upper-most parts of a high-sulphidation system. The lower levels of exposure within the Quevar stratovolcano comprise the alteration assemblage of kaolin, illite, alunite, quartz (opal, massive and common vuggy-silica) and barite. Precious metal mineralization is directly associated with the lower alteration assemblages. This relationship infers that the whole of the high-sulphidation alteration system should exist below the present level of erosion.
Mineralization within this alteration zone is more intense in its southern parts. Early stage mineralization includes an assemblage of quartz, pyrite, cassiterite and calcite followed by pyrite, an assemblage of argentite, silver sulphosalts, galena and stannite and is associated with advanced argillic alteration. A later stage is typified by zinc and pyrite. Nevado de Quevar is part of the Bolivian silver-tin mineralization system marked by the giant Cerro de Potosi silver-tin mines. Quevar appears to represent the most southerly known of this mineral belt.
Earliest evidence of mineral exploitation is evidenced by Inca-Jesuit workings. Two small silver mines began operation in 1939 but there is no documentation of production. In the mid-1980s to late 1980s, Utah de la Americas and BHP respectively explored the area. SILEX is currently working on SALTA's Quevar II and Castor properties to the south. According to a recent Golden Minerals news release core drilling results at Quevar II and Castor are promising.
Prospecting in the late 1990s discovered a number of highly anomalous silver showings previously unrecognized. Silver values to 8,000 ppm as grab samples were discovered in vuggy alunite-quartz lenses, pods and masses, commonly but not invariably associated with barite and anomalous mercury. Many of these alunite-silica systems grade out into argillic and into pure acid-leach silica systems, both of which assayed values of silver. Of interest, there appears to be an inverse relationship between the silver and the lead, although lead remained highly anomalous. The area that presently constitutes the western part of the Campo Viejo prospect was included in SALTA's reconnaissance exploration.
Previous values obtained from the Campo Viejo zone of mineralization included a number of silver assays to 90 ppm taken from a prominent ledge of acid-leach alunite and silica. Of interest, from all the previous samples taken by SALTA from the Nevado de Quevar area, anomalous gold has been noted only from the Campo Viejo area, where values of 260 ppb to 1,000 ppb occur in surface grab samples from outcrop. The central and northern parts of the Nevado de Quevar alteration system have not been subject to systematic prospecting and the Campo Viejo claim covers most of this ground.
DETAILS OF SILEX-SALTA OPTION AGREEMENT
On October 27th 2008, SALTA and SILEX entered into an option agreement whereby SILEX can earn a 60% interest in Campo Viejo over a period of four years by paying US$600,000 ($50,000 paid) and spending US$1 million on exploration which includes 1,000 metres of drilling. Once SILEX provides notice of the expenditure and the investment (First Call), SILEX may at its sole discretion form a 60/40 joint venture with SALTA; or, SILEX may acquire an additional 20% interest in Campo Viejo by preparing a feasibility study within 3 years of the exercise of the First Call in the Option Agreement. If SILEX chooses the latter option then it will make a onetime payment to SALTA of US$250,000. In addition, if SILEX chooses to form a 60/40 Joint Venture, SALTA has a 90-day period to agree to the Joint Venture or to convert its 40% interest to a 3% net smelter return royalty (NSR) on precious metal and a 1% net smelter return royalty (NSR) on base metal. SILEX has the right to purchase 50% of the precious metal NSR for US$2 million and 50% of the base metal NSR for US$1 million within 3 years of commencement of production. To keep its NSR purchase rights in full force SILEX shall make annual payments to SALTA of $US100,000 the total of which shall be deducted from the first NSR payment if SILEX exercises its purchase right in the first three (3) years.
Exploration on Campo Viejo from 2005, including mapping, prospecting, and geochemical sampling was supervised and directed by Dr. Tom Richards PhD., P.Geo, who is the qualified person for Cascadero's and SALTA's Argentine exploration program. The field work was conducted and supported by Salta personnel. All samples were transported to SALTA's office in the city of Salta then packaged and shipped for sample preparation to ACME Analytical Laboratories in Mendoza and Santiago, Chile and then flown to ACME Analytical in Vancouver for assay.
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