El Callao gold prospect — Teck, Kinross team in Venezuela

Within a year of acquiring several promising gold deposits in North America and Zimbabwe, Kinross Gold (TSE) has set its sights on Latin America.

At the annual meeting in Toronto, the company announced it is teaming up with Teck (TSE) to explore and develop several concessions in the historic El Callao gold district in Venezuela’s Bolivar state.

Under an agreement with CVG-Minerven, a Venezuelan Crown corporation, Kinross and Teck can each earn a half interest in two groups of properties: the Minerven 1, 2, 8 (part only) and 9, and the Choco 3 and 5. In return, the partners must pay $12 million in cash and $12 million in expenditures over three years. The interests will be subject to a sliding-scale royalty. With attention having recently been focused on the country’s Kilometre 88 region, many seem to have lost sight of the fact that, historically, El Callao has been the more prolific of the two areas. During the past 100 years, a series of mines there have yielded more than 6.3 million oz. gold. Six major mines accounted for most of the production, and one of those — Columbia — continues to yield 750 tonnes per day, with reserves reported at nearly 2.5 million oz.

Gold occurs in quartz veins hosted in wide, regionally extensive shear zones in altered mafic volcanic rocks. The veins range from one to several metres in width, and dip from 30 to 60 in a southerly direction.

The concessions contain three major past-producing mines — Chile, Laguna and Panama-A lode — which collectively yielded more than 1.5 million oz. Laguna and Chile were closed in 1944 and 1945, respectively, and have underground workings that extend to about 200 metres below surface. Based on limited shallow diamond drilling projections from underground workings, CVG-Minerven has estimated an additional reserve of 400,000 oz. in these two deposits. Most of the mineralization is contained in the western extension of the Chile mine. Few drill holes or modern exploration techniques have been used to test the strike and dip projection of these deposits. The partners are planning an aggressive surface and underground exploration program on the extensions of these deposits, as well as on other parts of the concessions. Teck will operate the project.

Other companies active in El Callao include Bolivar Goldfields (VSE), Labyrinth Resources (VSE) and Goldfields of South Africa.