TSX-V:CCD

SIERRA TACA TACA PROSPECTS

NORTHWESTERN ARGENTINA
TACA TACA ARRIBA-LA SARITA PROSPECTS

IRON OXIDE-COPPER-GOLD
HIGH-SULPHIDATION GOLD
GRANITE HOSTED GOLD-COPPER VEINS
COPPER-GOLD PORPHYRY PROSPECTS

Location and Access

Sierra Taca Taca is located 30 km west of the village of Tolar Grande, some 300 km from the city of Salta. The cateo is reached by all-weather-road to the western edge of Salar Arizaro and the Taca Taca Abajo prospect of Lumina Copper Corp. From there access is by 4 x 4 trucks and all terrane vehicles (ATVs). Immediately north of the property is the railway between Chile and Argentina.

Introduction

The Taca Taca Arriba, La Sarita and Teck properties were visited for three days in early November of this year (2004). Preliminary exploration was undertaken in November (2003) and April (2004). The reports by Fabricaciones Militares, Gencor, RTZ and BHP were reviewed in the middle of November. A general summary of some observations and conclusions are outlined below with a suggested outline for the first stage of work to be done on these prospects.

Three styles of mineralization underlie the Taca Taca Arriba-La Sarita area. These include: porphyry copper-molybdenum, high-sulphidation gold and IOCG settings. Although previous work (Fabricaciones Militares, Gencor, RTZ and BHP) focused solely on the porphyry potential, indications of the presence of the two other styles had been intimated from information within the data base and from personal communications. Porphyry mineralization appears earliest followed by and possibly in part contemporaneous with high-sulphidation mineralization. The IOCG style of mineralization is the youngest and most widespread stage of mineralization. All three styles of mineralization are found on the Palladon and Salta Exploraciones ground and the IOCG stage is noted on the Teck ground.

The prospect area underlies the prominent northeast trending Sierra Taca Taca horst block located along the northwestern margin of Salar Arizaro. This horst is bounded and defined by prominent north northeast trending fault structures. It is host to a variety of styles of mineralization that include the known Taca Taca Abajo and Arriba porphyry copper-gold systems, Taca Taca Sur low-sulphidation system and the recently recognized high-sulphidation and IOCG settings. The main range is underlain by Late Eocene to Oligocene volcanic rocks of the Santa Ines Formation. To the immediate east are granitic rocks that have been mapped regionally as a Permo-Triassic complex although younger phases are present as numerous dykes and sills cut the Santa Ines volcanics. In part, these younger intrusions host the Taca Taca Arriba porphyry. East of the main Sierra Taca Taca range and separated from it by a prominent northeast trending graben, the dominant bed rock is comprised of Paleozoic granites intruded by a small stock (3 x 1.75 km) that hosts the 29-35 Ma Taca Taca Abajo porphyry. The graben separating the two intrusive complexes is underlain by red bed lacustrine-evaporite sediments of the informally named Oligocene-Miocene Siete Curvas basin. The Sierra Taca Taca horst is transected by northeast trending structures and by a major northwest trending transverse structure marked by numerous linear features, the Taca Taca Arriba and Abajo porphyries and by an aligned suite of Quaternary to recent rhyolite and basalt cones.

Porphyry Setting

Earliest stage of mineralization is marked by the Taca Taca Arriba porphyry setting which has been the main focus of exploration. The age of the porphyry is unknown but is likely of Late Tertiary age, similar to the Taca Taca Abajo porphyry dated at 29 Ma. The porphyry is hosted in granitic rocks that intrude the Late Eocene-Oligocene Santa Ines volcanics (personal communication SEGEMAR, 2004). The porphyry system is hosted in mainly altered quartz monzonite and comprises moderate to strongly developed stockworks of quartz-sericite (D-veins). Minor earlier quartz veins were noted. The dominant texture noted is pinkish, early argillic altered quartz monzonite cut by networks of white, quartz-sericite veins that locally coalesce into an intensely bleached, phyllic altered rock. Hematite is not common in most of the Taca Taca Arriba porphyry excepting in its most eastern parts. The porphyry measures some 2.5 x 2 km in dimensions. The area has been subject to 13 widely spaced drill holes, 9 core holes by Fabricaciones Militares and 5 reverse circulation holes by BHP. Mineralization encountered in these drill holes had grades of 0.33% copper over 30+ metres. Surface exposures are strongly leached with the widespread presence of jarosite, goethite and subordinate 'live hematite'. Pyrite casts are abundant. Secondary copper mineralization is restricted to widespread turquoise and chrysocolla. A secondary enrichment blanket averaging about 21 metres thick is reported. Gold values from the porphyry are low, all below 100 ppb and most in the background range. Much of this porphyry prospect remains untested.

High-Sulphidation Setting

A distinct zone, up to 300-400 metres wide, of highly bleached altered rocks defines the northwest margin of the Taca Taca Arriba porphyry. This zone is marked by the strong white colour anomaly noted on the satellite images and has, generally, been included as part of the Taca Taca Arriba porphyry. Examination of the southwestern and northeastern parts of this zone showed that it is, in whole or in part, comprised of a northeasterly trending, high-sulphidation alteration system traceable for 3 to 4 km across the Palladon ground into the Salta Exploraciones ground. Original host rock appears to be the feldspar and quartz-eye porphyry volcanics that make up the backbone of Sierra Taca Taca. North to northwesterly trending zones of high-sulphidation alteration were noted as alteration ledges and breccias within the altered quartz monzonite of the Taca Taca Arriba porphyry and as northwesterly trending lenses (to 30 m width) on the Salta Exploraciones ground to the immediate north. In one zone, fluorite was noted with the alteration. These alteration zones comprise strongly chalky altered volcanics with irregular lenses to masses in excess of 50 m thick of silicified rocks, commonly with the 'acid-leach' texture that typifies high-sulphidation systems. Primary (finely sugary) alunite, kaolinite and pyrophyllite have been identified in the hand specimen (and alunite by the acid vapour test), and the RTZ data base reports the presence of dickite, pyrophyllite and alunite (secondary) identified by PIMA, although the report does not give a location for these clay minerals. During the investigation of the Taca Taca Arriba porphyry, Gencor, RTZ and BHP analyzed a number of rocks for gold (amongst other metals). Although only low gold values were encountered (to 1,000 ppb), the location of most of the gold values in excess of 100 ppb are found within or proximal to the hypothesized trace of the high-sulphidation alteration system. As this high-sulphidation system has not been previously recognized and thus not explored for gold, this system marks a definitive target for follow-up exploration. The extent of this alteration system remains to be discovered and tested.

IOCG Setting

The third and youngest stage of mineralization that underlies Sierra Taca Taca can be classified as an IOCG setting. This IOCG mineralization on Sierra Taca Taca comprises three different, interrelated styles: regionally extensive veins, stockworks and breccias of specular hematite associated with potassic and albite alteration; veins and stockworks of hematite, quartz, jarosite and copper associated with potassic and argillic and phyllic alterations; and, a set of poorly exposed veins of hematite, chalcocite and gold (to 32g/tn).

The regionally extensive IOCG system is represented by an elongate north to north northeast trending 16 kilometre long belt of veins, stockworks and breccias that extend almost the whole of the length of the central part of Sierra Taca Taca. Mineralization along this belt comprises dominantly specular hematite (rarely pseudo morphed by magnetite) with subordinate amounts of fluorite and minor copper. Veins are stockworks to massive, trending NW and NE within north northeast structures. Mineralization is hosted mainly in the granitic rocks in proximity to the contact with the Santa Ines volcanic rocks. Widespread to intense potash alteration is present, including well developed veins of potash feldspar in the hematite veins and breccias. RTZ data reports that some of the pinkish altered feldspars are an albite alteration associated with fine-dust hematite rather than potash feldspar. Geochemically, this system carries little gold and is locally anomalous in cobalt, phosphorous and REE (lanthanum).

Where the regional IOCG vein, stockwork and breccia system crosses the eastern part of the Taca Taca Arriba porphyry, the system blossoms out into a broad, northeasterly trending zone measuring some 3.5-4 km long and ranging from 1 to 2.5 km in width. This zone marked by the presence of common to abundant veins, stringers, stockworks, and breccias of specular hematite. In the southwestern and northeastern parts of this zone, the veins and alteration are developed to a sufficient strength and extent to outline two zones that are suggestive of a hybrid style of IOCG porphyry mineralization. Both zones overlap with the Taca Taca Arriba porphyry. Mineralized veins comprise a sequence of hematite, hematite-jarosite-copper, hematite-jarosite-quartz, hematite-jarosite-quartz-copper and jarosite-quartz-copper. In the eastern part of the Taca Taca porphyry, veins of hematite-tourmaline (+/-copper) with potash feldspar selvages cut the phyllic alteration of the D-veins. Alteration associated with this hybrid IOCG porphyry setting includes potash feldspar, albite (?), phyllic and argillic assemblages. This hybrid IOCG porphyry style of mineralization has only been recently recognized and its significance remains to be documented. Both of the hybrid zones occupy areas in excess of 1 km2 and the distribution of mineralization, fracture intensity, alteration and extent remain to be documented. From the abundant presence of jarosite, it appears that surface leaching has been extensive. All copper mineralization noted has been of the insoluble residue copper species of chrysocolla and turquoise.

The third style of mineralization associated with the IOCG belt is represented by limited exposures of hematite-chalcocite-gold veins with gold values up to 32g/tn. The discovery pit for these veins is a small (40cm x 40cm) pit located near the break in slope of Sierra Taca Taca and the graben valley to its immediate east. This site is located at or near the boundary between the Teck and Salta Exploraciones cateo. Subsequent follow-up located a second small workings immediately within the Salta Exploraciones cateo with in excess of 20g/tn gold and other poorly exposed veins of similar nature (assays pending) within the Teck cateo but near the mutual boundary. The extent of these valley-graben margin veins is unknown as exposure is very poor. It is probably that these veins were discovered by los Indios by the recognition of small flakes of copper in the pediment.

The western Puna is a newly recognized IOCG belt of Tertiary age. The IOCG mineralization post dated the main porphyry setting (and most likely the high-sulphidation). Established IOCG mineralization in northwestern Argentina and the immediate area includes the 500 million tonne El Laco magnetite-hematite deposit in Chile and the Rio Grande-Arizaro copper-gold prospects in NW Argentina (Hitzman, personal communication 1999). The presence of El Laco is a testament of the order of magnitude that these systems can attain and the reason why they are prime targets for exploration.

Suggested Work Program

Salta Exploraciones has spent the equivalent of 50 man days (including office and travel) working on the property from the village of Tolar Grande on this prospect. Work was supported by trucks and quads owned by Salta Exploraciones. This work has outlined the presence of a significant high-sulphidation system, documented the extent and variations of a large-scale IOCG system and given a cursory investigation of the porphyry setting. The data from Taca Taca Arriba were reviewed in Salta and this information added to the interpretations above.

The property has three, possibly four potential targets of significance. The first stage of work should be directed to document the viability of each of the zones with respect to its economic potential and provide an outline for the follow-up stages.

  1. The high-sulphidation system is similar to other known high-sulphidation systems and represents a bona fide target for continued exploration. Work on this should include:
    1. Location and sampling of all high-sulphidation areas on the property. It is known that this zone extends to the north and is suspected to continue to the west towards the western side of Sierra Taca Taca. Silicified zones have been noted from previous work in areas of volcanic rocks to the northwest of Taca Taca Arriba and to the south, on La Sarita Sur controlled by Salta Exploraciones.
    2. High-sulphidation alteration is known to cut the porphyry.
    3. Map the entire system

  2. The IOCG system will require mapping at both regional and property scale. It is known that these systems have the potential to contain very large tonnages of metal and that not all IOCG systems are fertile. The regional setting and detailed setting of the IOCG system should be established to determine if the structural setting points of any focus points for the origin of this system, in particular in the area of Taca Taca Arriba and points to the east (on Salta Exploraciones and Teck ground), where the 16 km long vein-stockwork-breccia system intersects the cross-structure that hosts and defines the locus of the Taca Taca Arriba and Abajo porphyries, the Pleistocene basalt and rhyolite cones and domes and the prominent west northwest linear and fault structures that define this part of the Sierra Taca Taca.
  3. The high-grade gold veins located along the border of Salta Exploraciones and Teck ground needs to be evaluated. Extensive prospecting is recommended to determine the presence of additional gold bearing veins. A program consisting of mechanical trenching is recommended to expose these veins their orientation and widths are unknown.
Dr. Thomas A Richards
Salta, Argentina
Nov 19, 2004
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