VANCOUVER — Development potential is coming into focus for Toronto-based explorer Ecuador Gold and Copper (TSXV: EGX) at its flagship Santa Barbara gold–copper porphyry deposit along the Zamora belt in southeastern Ecuador. On March 24 Ecuador Gold released an updated resource at Santa Barbara — which sits in the company’s 83 sq. km Condor project — that will form the basis for a preliminary economic assessment (PEA) due out by the end of April.
Santa Barbara’s new resource incorporates another seven holes over 4,000 metres completed through the end of January, upgrades material to the indicated category, and adds inferred ounces.
Resources at Santa Barbara South and North have been combined into a single block model and total 365 million indicated tonnes grading 0.51 gram gold per tonne and 0.1% copper, for 6 million contained oz. gold and 804.8 million contained lb. copper. Inferred resources add 178 million tonnes grading 0.4 gram gold and 0.1% copper for 2.3 million contained oz. gold and 392 million contained lb. copper. All resources assume a 0.25 gram gold cut-off grade.
Vice-president of exploration Mit Tilkov noted in a release that phase-two drilling generated resources and targets, while “surface mapping and geochemistry indicate potential to increase resources north and southwest of the Santa Barbara North zone and east and southeast of the best intersections to date in the southern part of the deposit. I believe that we may be on the fringes of a significant gold–copper porphyry system that would warrant further drilling in 2015.”
Porphyry mineralization at Santa Barbara is developed in basaltic–andesitic volcanics and associated with dioritic porphyry intrusives. The geological unit is the same as that which hosts Kinross Gold’s (TSX: K; NYSE: KGC) Fruta del Norte gold deposit to the north. According to recent technical documents, Santa Barbara is also similar to AngloGold Ashanti’s (NYSE: AU) porphyry gold discoveries at La Colosa in Colombia.
Ecuador Gold is awaiting results of Santa Barbara’s PEA before planning its next drill program. In the meantime, the company is mapping and sampling across more targets at Condor. Mapping has doubled the known strike length of an altered diorite porphyry north of the El Hito deposit, which hosts 161 million tonnes grading 0.31% copper for 1.1 billion contained lb.
Ecuador Gold has identified more targets north of the Chinapintza vein district, as well as expansion potential around its Santa Barbara resource.
Ecuador Gold has benefited from a number of warrant excercises over the past four months. Long-time private financial supporter Aura International Services has exercised 23.3 million warrants since December for gross proceeds to Ecuador Gold of US$1.75 million. Aura holds a 52% equity stake in the company.
Ecuador Gold has traded within a 52-week window of 2¢ and 14¢, and closed at 8.5¢ per share at press time. The company has 195.4 million shares outstanding for a $16.6-million market capitalization.