Shares of Chakana Copper (TSXV: PERU) gained 78% on their first day of trading and the release of assays from five shallow drill holes at the company’s Soledad copper-gold-silver project in central Peru, 260 km northwest of Lima.
Soledad hosts multiple high-grade, quartz-tourmaline-sulphide breccia pipes that outcrop in the Cordillera Negra and western ranges of the Andes, 35 km south of Barrick Gold’s (TSX: ABX; NYSE: ABX) Pierina gold-silver mine in the country’s prolific Miocene metallogenic belt.
The company has drilled the project since August and listed in February through a reverse takeover of Remo Resources. After starting at 50¢ per share, the junior explorer, whose chairman is renowned geologist Douglas Kirwin, shot to a high of 91¢ before closing at 89¢ — a 39¢ gain.
“The strong response to the listing seems to underscore the market’s appetite for high-grade, copper-gold projects in a favourable mining jurisdiction, such as Peru,” Chakana Copper’s president and CEO, David Kelley, tells The Northern Miner.
So far, drilling has focused on one of nine known breccia pipes (Breccia Pipe No. 1), where the company has drilled from a central platform at different azimuth and dip angles to define the geometry and grade profile of the pipe.
The assay results come from five holes and include a 69-metre intercept from surface grading 3.15 grams gold per tonne, 11.3 grams silver per tonne and 0.39% copper, including 22 metres starting from 47 metres downhole of 3.89 grams gold, 21.3 grams silver and 1.18% copper in drill hole 17-24.
Drill hole 17-22 returned 21 metres from surface grading 4.87 grams gold and 32.9 grams silver, and 33 metres of 5.31 grams gold, 66.1 grams silver and 0.39% copper from 43 metres downhole. Drill hole 17-25 cut 30 metres from surface of 3.50 grams gold and 8 grams silver, and 5 metres of 10.05 grams gold, 22.1 grams silver and 0.74% copper from 48 metres downhole.
“Drilling on the project continues to go very well,” Kelley writes in an email from Peru. “The results … provide further confirmation of the excellent grades in copper, gold and silver, and even some interesting zinc and lead numbers.
“It’s important for people to realize that the pipes are vertical bodies with cylindrical to oval shapes, and they have to be drilled from all angles to accurately define the geometry and grade variation,” says Kelley, who was a member of the joint discovery team of the Zuun Mod molybdenum-copper deposit in Mongolia, the Wayamaga gold deposit in French Guiana and the High Lake East deposit in Nunavut.
“Holes with shallower angles drilled from surface will have shorter intercepts, but these intercepts are still important, as they provide control for defining the volume potential. With additional drilling we will be testing our hypothesis that higher-grade mineralization concentrates at the margins of the breccia, and that the pipes are getting larger at depth.”
The company has drilled 8,600 metres of an original program of 16,660 metres, and is earning a 100% stake in the project over four years under an option agreement with project generator Condor Resources (TSXV: CN). The deal includes a 2% net smelter return royalty.
Kirwin, a member of the joint discovery team of the Hugo Dummett deposit at Oyu Tolgoi in Mongolia and a corecipient in 2004 of the Prospectors and Developers Association of Canada’s inaugural Thayer Lindsley Award for the most significant international mineral discovery, was asked his opinion of the property by some of his friends in January 2017.
He was impressed by the gold and copper drill intercepts, the tourmaline breccia pipe-style mineralization and the fact that there were a number of targets ready to drill right away, and recommended that they try to acquire the project.
While breccia pipe targets tend to be relatively small tonnages, he said in an interview with The Northern Miner in late 2017, they can be very high grade, and tourmaline pipes often have a series of vertical extents of greater than a kilometre. They also occur in clusters, and the team knows of at least 12 around Soledad.
Results from two of five holes drilled into Soledad in August and September returned highlights of 147 metres from surface grading 2.51 grams gold, 48.6 grams silver and 0.77% copper, with the top 44 metres of the hole cutting 3.92 grams gold and 29.6 grams silver in hole 17-17. The second hole, 17-18, returned a 209-metre intercept from surface grading 2.22 grams gold, 69.6 grams silver and 0.96% copper. Within the 209-metre intercept was a 74-metre interval of 3.31 grams gold, 65.5 grams silver and 1.1% copper.
In October, Chakana Copper reported assays from the other three holes. Hole 17-20 returned 113 metres from surface grading 1.17% copper, 3.58 grams gold per tonne and 51.5 grams silver. A second hole, 17-19, penetrated a blind breccia zone from 88 metres to 230 metres southwest of previous drilling. The hole returned two mineralized intervals of 37 metres with 2.20% copper, 0.80 gram gold and 136.1 grams silver, and 25.3 metres grading 1.64% copper, 1.72 grams gold and 221.4 grams silver.
The company hopes to retrieve drill information down to 600 metres and produce an inferred resource on two of the nine pipes that have been found over 2 square kilometres. Separation between the pipes at surface ranges from 300 to 500 metres.
Typical breccia pipes can be oval-shaped and between tens of metres and hundreds of metres across, Kelley says. The biggest ones are in the Los Bronces-Rio Blanco district in Chile, where large tourmaline breccia deposits of the same style as Soledad are found.
The most spectacular, Kelley says, is the Los Sulfatos deposit, which is owned and being developed by Anglo American (LON: AAL; US-OTC: AAUK). Los Sulfatos has an inferred resource of 1.2 billion tonnes grading 1.46% copper and 0.02% molybdenum. Other tourmaline breccia deposits in the district, he says, include Sur Sur and Donoso.