Since signing an earn-in agreement with Salazar Resources (TSXV: SRL) last September, Adventus Zinc (TSXV: ADZN) has updated the resource on its El Domo copper-gold-zinc deposit at the Curipamba project in Ecuador and launched an 18,000-metre drill program.
The two companies plan to explore for volcanogenic massive sulphide (VMS) as well as hydrothermal gold-silver style deposits on the 215.4 sq. km project in west-central Ecuador. The work program this year will also consist of infill and definition drilling at El Domo and test the volcanic strata between the El Domo VMS deposit and other nearby targets, such as El Gallo, 420 metres south.
“Curipamba always had terrific regional exploration potential, but Salazar was cash-constrained,” Christian Kargl-Simard, Adventus’ president and CEO, says in an interview. “With our earn-in transaction, the project finally has sufficient capital to complete regional exploration.”
Adventus and Salazar updated El Domo’s resource at the end of January, with indicated resources (open pit and underground) measuring 8.8 million tonnes grading 1.62% copper, 2.42% zinc, 0.27% lead, 2.34 grams gold per tonne and 48 grams silver per tonne. There are another 2.6 million inferred tonnes (open pit and underground) averaging 1.29% copper, 1.51% zinc, 0.14% lead, 1.09 grams gold and 29 grams silver.
“The hope is to double or triple the resource at those kinds of grades, which would create hundreds of millions of dollars of value,” Kargl-Simard says. “We’re drilling areas discovered in 2007 and 2008 that have never been drilled.”
Last year, Salazar drilled 10,000 metres. One step-out hole returned 16.6 metres of 3.66 grams gold, 117.40 grams silver, 4.88% copper and 5.36% zinc.
One of the targets that has generated the most excitement is in an area of the project called Sesmo, which has several high-grade historic channel samples, including 15 metres of 39 grams gold and 741 grams silver, which has never been drilled. Other channel samples from Sesmo returned 10 metres of 9.54 grams gold and 634 grams silver, and 3 metres of 12.30 grams gold and 469 grams silver.
“We’ll be drilling Sesmo and several other high-grade surface showings in the region for the first time starting in early March, so we’re very excited about what results can come out of this drilling, because it’s truly a lottery ticket,” Kargl-Simard says.
Sesmo is one of over a dozen previously known precious metal-rich targets at Curipamba, which include Cade, Cade 1, Cade Sur, Roble, Roble 1, Roble Este, El Gallo, Sesmo Sur, Agua Santa and La Vaquera.
The Cade targets, 100 to 600 metres west of El Domo, returned a rock-chip sample of 7 metres grading 9.80 grams gold and 409 grams silver, while at the Roble targets, 100 metres north of El Domo, channel sampling of outcrops along a mineralized trend yielded a 3.6-metre sample grading 15.12 grams gold, 258 grams silver, 0.56% copper, 5.25% zinc and 3.25% lead.
At the El Gallo target, south of El Domo, channel samples from outcrops along a mineralized trend in a creek bed yielded a 17-metre sample grading 11.2 grams gold and 505 grams silver.
Included in the work program this year will be an airborne electromagnetic geophysical survey, which will serve as a guide for regional drilling, as well as generate regional reconnaissance targets.
Under the agreement with Salazar, Adventus is earning a 75% stake in the project by spending US$25 million over five years. A feasibility study is expected within three years, after which Adventus would fund all of the development and construction expenses to commercial production. Once in production, Adventus will receive 95% of the cash flow from the project until it recoups its full investment.
In addition, Adventus and Salazar have formed a separate and exclusive exploration alliance to explore for zinc-related deposits outside the Curimpamba project area.
“We have a great relationship with Salazar Resources,” Kargl-Simard says. “Salazar operates for us in Ecuador, but Adventus brings the capital market presence, that is, marketing, industry relationships, capital-raising ability and development expertise.”
Strategic shareholders of Adventus include Altius Minerals (TSX: ALS), with 27%; Greenstone Capital, with 18%; and Resource Capital Funds, with 16%.
While Adventus is well backed financially, Salazar Resources has clout in Ecuador and its president and CEO, Fredy Salazar, has a track record in South America.
From 1990 to 1998, he worked as the regional exploration geologist for Newmont Overseas Exploration, where he reviewed and evaluated over 100 gold prospect submittals.
He was also instrumental in Aurelian Resources’ acquisition of the Fruta del Norte property, and was their head of exploration.
Fruta del Norte is now owned by Lundin Gold (TSX: LUG).
Kargl-Simard notes that given Salazar is an Ecuadorian company, Adventus has a strategic advantage and the partnership helps exploration. “Fredy has operated in Ecuador, Northern Peru and Colombia since the 1980s … and has codiscovered many of the known deposits in Ecuador,” he says. “Due to this relationship, we have had an inherent advantage operating in the country, being somewhat insulated and with a good perspective.”
El Domo — which Salazar found in 2008 — is near the towns of Las Naves and Ventanas in west-central Ecuador’s Bolivar province in a juvenile volcanic-magmatic arc of the Paleocene-Eocene Macuchi Terrane, which hosts at least two other volcanogenic massive sulphide deposits, the company says.
The sulphide mineralization at El Domo mostly occurs at the contact between a felsic volcanic dome and overlying volcaniclastic strata, and is generally flat-lying.
The mineralization has been traced for 800 metres from north–south and between 350 metres and 500 metres east–west.