Herencia Resources plc is a resources company listed on the Alternative Investment Market (‘AIM’) of the London Stock Exchange with a focus on developing the Paguanta Project in northern Chile and advancing other project opportunities with the aim of adding value for shareholders.
The Paguanta Project comprises the Patricia zinc-silver-lead-gold Mineral Resource and the Doris copper-silver and La Rosa copper targets. The Total Mineral Resource at Patricia stands at 3.5Mt at 4.6%Zn, 1.46%Pb, 93g/t Ag and 0.23g/t Au (2% Zn cut-off).
During 2011 Herencia plans to undertake a Feasibility Study into the Patricia Mineral Resource and complete 15,000m of diamond drilling at Patricia, Doris and La Rosa. The Company is also actively pursuing quality JV opportunities within South America.
Herencia has the backing of some major resources identities including Nyrstar, the world’s biggest zinc smelting group, who hold 10% equity in Herencia.
09/01/12
Drilling Update06/01/12
Issue of Equity05/12/11
Issue of Options02/12/11
Drilling Commences at Guamanga Project02/12/11
Director/PDMR Shareholding & Issue of Equity
02/03/11
MD Michael Bohm is confident that the Patricia resource will continue to grow: “Every time we drill we find high grade mineralisation where we expected to find it – but also where we didn't expect to find it!”
07/10/10
The shares surged over 25% by midday on AIM after news that drilling on the flagship Paguanta project increased tonnage by 33%, and upped zinc, lead and silver grades substantially. MD Micheal Bohm said the upgrade augurs well for the planned mining operation, initially targeting 400,000 tonnes of ore per annum.
17/09/10
The Chilean zinc-lead-gold-silver project has seen a significant resource upgrade, and for the first time, Herencia included a gold grade estimation to provide possible revenue credit.
10/09/10
The stock has gained considerable traction on London’s AIM market this week. The latest exploration result propelled it over 60% to a 2-year high in Friday's trading.
15/07/10
Mike Bohm spoke in detail about Herencia Resources' (LON: HER) new major investor and why he was not prepared to sign an off-take agreement for the zinc from the firm’s Paguanta project in Chile.
09/02/12
Herencia Resources reports high grade drill results from Patricia zinc-lead-silver project07/02/12
Herencia Resources' Guamanga could be 'company making' asset, says WH Ireland09/01/12
Herencia Resources plans to test deeper targets at Guamanga copper-gold project02/12/11
Herencia Resources kicks off drilling campaign at Guamanga copper-gold project21/11/11
Herencia Resources impressed with drill results from Patricia zinc-lead-silver-gold project
10/12/2010
26/11/2008
Herencia Resources plc is a well funded, multi commodity, multi project exploration and development company listed on the Alternative Investment Market (‘AIM’) of the London Stock Exchange. The Company’s primary focus is on developing its Paguanta zinc-silver-lead-gold Project and exploring its new Guamanga Copper-Gold Project in northern Chile.
Herencia has commenced a Feasibility Study into the proposed Patricia Mine (Zn, Pb, Ag and Au), with the goal of bringing Paguanta into production by fourth quarter, 2012. Drilling of the exciting "Doris" copper-silver prospect and the 'La Rosa' porphyry-copper target plus infill/step out drilling of the Patricia Mineral Resource are all scheduled throughout 2011 with positive exploration results having already been returned from recent drilling activities at Pagunata.
Herencia is also earning a 51% interest in its new Guamanga Copper-Gold Project which has a mineralisation style appearing to correspond to a potential Iron Oxide Copper Gold (IOCG) system and is located only 15 kilometres from Anglo America's large Mantoverde Mine.
Herencia has the backing of the global zinc group Nyrstar.
Patricia
The Paguanta project area consists of 14 licences covering an area of 39 sq kilometres. The area is on the northern part of the main Chilean porphyry copper belt, which houses some of the world’s largest copper mines. The Paguanta Project comprises:
•The 'Patricia' zinc-silver-lead-gold Mineral Resource
•The 'Doris' high grade copper-silver prospect
•The 'La Rosa' porphyry-copper prospect
The Company announced the results of a Scoping Study (late 2008) into the economic and technical viability of developing the Patricia deposit, completed by Golder Associates (the global resources and engineering consulting group). The results of the Scoping Study were encouraging with highlights including:
•An underground mining inventory of 1.66Mt @ 6.1% Zn, 2.0% Pb, 154g/t Ag and 0.26g/t Au
•An open pit mining inventory of 1.43Mt @ 2%Zn, 0.9% Pb and 48ppm Ag
•Initial potential mine life of approximately 5.5 years at 500,000 tpa
•Opportunity to increase mine life with further drilling (see drill hole results below)
•Capital Cost of US$55.6M (inclusive of all underground mine development and new processing plant equipment costs)
•Site Operating Costs of US$55.32/t
•Substantial positive sensitivity to any potential increase in tonnage and grade
Significantly, the mineralisation remains open at depth and strong potential for depth extension at increased grade. The three deepest diamond drill holes in the resource envelope returned the following high grade results:
•DDH015 – 6m @ 9.8% Zn, 4.7% Pb, 349g/t Ag and 0.67g/t Au
•DDH024 – 14m @11.9% Zn, 1.1% Pb and 95g/t Au
•DDH033 – 3m @ 5.4% Zn, 3.1% Pb and 150g/t Ag
The above grades are significantly higher than the Mineral Resource Estimate (see below) and the presence of gold is an additional positive outcome. Gold has been recovered in both bulk samples (up to 1.5g/t) and in many of the mineralised drill intercepts.
Well funded drilling programs through 2011 are in progress to test the significant potential for depth and strike extensions to the known mineralisation at Paguanta and a Feasibility Study is in progress.
In April 2010, leading global zinc smelting group Nyrstar International BV ("Nyrstar") took a 10.4% stake in the Company by investing £750,000 and accepted a board seat at Herencia. Nyrstar are supportive of plans to move the Paguanta Project toward development.
Mineral Resource
The Paguanta Project comprises a Mineral Resource Estimate (Indicated and Inferred) upgraded in September 2010 of:
3.51Mt at 4.6% Zn, 1.5% Pb, 93g/t Ag and 0.2g/t Au (at a 2% zinc cut-off)
1.42Mt at 7.7% Zn, 2.4% Pb, 146g/t Ag and 0.3g/t Au (at a 4% zinc cut-off)
This Mineral Resource Estimate complies with recommendations in the Australian Code for Reporting of Mineral Resources and ore Reserves (2004) by the Joint Ore Reserves Committee (JORC) of the AusIMM.
Location
The Paguanta Project Area is located approximately 120 km east northeast of Iquique and approximately 30 km west of Chile’s border with Bolivia. Vehicular access from the highway was first established in 2004 and the road journey is now 195 km from Iquique, the regional capital. A sealed national highway is located just 20 km north of the project area.
Regional Geology
Paguanta is located near the Cerro Colorado porphyry copper mine at the northern end of the Domeyko fault system, which stretches over more than 1,000 km in northern Chile and hosts a number of important copper deposits.
The immediate area around Paguanta is highly mineralised with an open-cast copper mine at Cerro Colorado (BHP Billiton) 40km south-west of the project exploiting a supergene deposit of 228 Mt grading 1% copper. Other porphyry copper prospects currently being explored are at Mocha (Codelco), Queen Elizabeth (Anglo American) and Yabricoya (Codelco).
Host rocks comprise tightly folded and faulted Palaeozic basement, Jurassic-Cretaceous aged sediments and arc-related volcanics. Tertiary aged felsic intrusions have been mapped and are spatially related to zones of alteration and mineralisation.
Mineralisation
The Patricia Zone is a zone of zinc, silver, lead and gold mineralisation. Petrographic study of outcrop and diamond drill samples identified low sulphidation style mineralisation with economic mineralisation dominated by sphalerite (zinc), galena (lead), and argnetine (silver). Low levels of gold are associated with arsenopyrite. There is evidence of an earlier gold bearing potassic alteration phase, associated with older, deeper felsic intrusions.
One kilometre north of Patricia, the La Rosa Zone is an area of intensely leached, argillic alteration over 3 square kilometres, prospective for porphyry copper-gold mineraliation in supergene blankets or stocks. Located immediately to the south-east of La Rosa is the Doris prospect which has confirmed high grade copper and silver mineralisation at surface.
Various styles of acid intrusive have been mapped, together with potassic alteration; including the presence of biotite and magnetite. Geochemical values are subdued as expected, however low levels of copper and gold are co-incident with the higher intensity alteration zones. There remain few untested argillic anomolies of this scale in this important copper producing region.
Elevated gold anomalism has been returned from stream sediment sampling of the Portillo Zone 2 km west of the Patricia zone.
History
Silver was discovered and first worked in the area by a team of miners headed by an Englishman in the 1880's. Together they completed approximately 1,800m of underground development into what is now called the Patricia zone. The principal development is an adit running 400m in length that intersects three high-grade veins. The Patricia mine at Paguanta was abandoned in the late 19th century and the area was not subjected to further evaluation outside of regional reconnaissance. Herencia were the first modern explorers at Paguanta.
'Doris' (high grade copper-silver)
The 'Doris' prospect is located approximately 1.5km north-east of the main 'Patricia' zinc-lead-silver-gold Mineral Resource and approximately 1.5km south-east of the 'La Rosa' porphyry-copper target within the world-class Chilean copper belt. Continued high grade copper (up to 5.1%) and silver (up to 573g/t) assay results at surface highlight the opportunity for a potential copper/silver discovery in close proximity to our 'Patricia' zinc-lead-silver-gold deposit.
'La Rosa' (porphyry-copper)
La Rosa is an advanced prophyry copper target covering an area of 3km and which is wholly within the Paguanta Project tenement package (70% owned by Herencia Resources plc). The area has never previously been explored due to poor access. La Rosa is 40km from BHP's giant Cerro Colorado Mine and approximately 150km from the world class operations at Quebrada Blanca (Teck), Colluhuasi (Xstrata/Anglo American) and other advanced prospects of CODELCO. In the immediate vicinity is Anglo American's Queen Elizabeth Project and CODELCO's Mocha Project.
Structure and Geochemistry
The La Rosa prospect is an area dominated by altered Cretaceous aged andesite volcanics, with minor felsic volcanic material and sediment.
La Rosa, superficially, is an area of intense argillic alteration, weathering and limonite (iron oxide) staining, the products of weathered pyrite. This area covers an area of 3km N-S and 1km E-W, and is bounded by two regional scale, north-south orientation faults. One of these faults has exposed quartzite in the footwall, thereby indicating it is a major regional structure. Due to the intense weathering, surface geochemistry is of limited use, however samples are anomalous in lead, zinc, copper, gold, silver and molybdenum. Grid surface geochemistry has been completed. The alteration zone extends to the Patricia epithermal Pb-Ag-Zn vein system, where a maiden Resource was announced during 2007. Herencia believe that the two prospect areas are part of the same mineralising system. Late barite veins have been mapped at La Rosa and elsewhere adularia is present, increasing the possibility of other epithermal veins within the large alteration system.
Guamanga
The Guamanga Copper-Gold Project, (Herencia earning 51%) is located approximately 750 kilometres north of Santiago in Region III in Chile and comprises approximately 11.2 square kilometres in total area. Access to the Project site is excellent with the Pan-American Highway located only 30 kilometres to the west and a major airport a 60 minute drive to the south on existing public highways/roads.
The Project mineralisation style appears to correspond to a potential Iron Oxide Copper Gold (IOCG) system. A good example of an IOCG deposit is Anglo American's large Mantoverde Mine, located only 15 kilometres to the north of the Guamanga Project. According to Herencia's geologists, the Guamanga Project displays evidence of a potential IOCG mineralisation system with:
•Abundant iron oxides (limonites) and primary magnetite and hematite;
•Copper mineralisation apparently associated with the iron oxide as breccias and stockwork;
•Iron-gold-copper veins and mantos mineralisation; and
•Copper, gold, cobalt and molybdenum anomalies at surface.
Seven holes have already been drilled at the Project site of which three intersected significant copper and gold mineralisation at shallow levels:
•Hole 1 – 8 metres at 1.55% copper and 0.53 g/t gold from 36 metres
•Hole 2 – 2 metres at 2.69% copper and 0.33 g/t gold from 9 metres
•Hole 2 – 6 metres at 2.20% copper and 1.34 g/t gold from 42 metres
•Hole 3 – 3 metres at 2.88% copper and 2.58 g/t gold from 34 metres
Field work on the Guamanga Project has commenced with an eight week surface mapping and sampling program scheduled together with a geophysical survey in preparation for a diamond drilling program scheduled to commence fourth quarter 2011.
Michael Bohm - Managing Director
Michael Bohm is a mining engineer having extensive experience in operations management, evaluation and project development in Australia, Northern Europe, SE Asia and North America. Michael has over 20 year’s minerals industry experience predominantly in the gold, nickel and diamond sectors in both open pit and underground mining environments.
His corporate experience includes previous directorships at Sally Malay Mining Limited in Australia (ASX) (now Panoramic Resources) and Ashton Mining in Canada (TSX). He is currently a non-executive director of ASX-TSX listed Perseus Mining Ltd.
Mike's responsibilities incorporate oversight of all activies in relation to Herencia's operational activities and representation on JV and subsiduary company boards.
Hon John Moore AO - Non-Executive Chairman
The Hon John Moore AO holds a Bachelor of Commerce and Associate in Accountancy from the University of Queensland. John has had a distinguished career in Australian politics; he was the Minister for Defence, the Minister for Industry, Science & Tourism and Vice President of the Executive Council.
Prior to entering politics, John Moore was a stockbroker and member of the Brisbane Stock Exchange. He has served on the boards of many broking and banking related companies including Citinational Limited, Merrill Lynch (Aust) Pty Ltd and Grindlays (Aust) Pty Ltd. In additional to his chairmanship, John's responsibilites at Herencia also include membership of the audit committee.
John Russell - Non-Executive Director
John Russell has over 30 years experience in Investment Banking. He was a member of the Australian Stock Exchange and a partner in Bain & Company. He has had 20 years experience in London and New York as head of Bain’s Branches in both cities. In 1992 Bain was acquired by Deutsche Bank AG and John continued as senior Director of Deutsche Bank Australia in Europe until the end of 1999.
Since retiring from Deutsche Bank John has been providing consulting services to smaller technology companies. John is Chairman of Henderson Far East Income Limited.
John's responsibilites also include Chairmanship of the audit committee.
Greg McMillan - Non-Executive Director
Greg McMillan was appointed Chief Operating Officer at Nyrstar in August 2007, and is responsible for Nyrstar's global operations. Greg has previously held General Manager positions in both mining and smelting operations before being appointed Chief Operating Officer upon the creation of Nyrstar. Greg began his career as a Production Engineer and prior to joining Nyrstar, held managerial positions within Delta Group, Boral and Brambles Limited. Greg also holds a Bachelor of Commerce and Masters in Business Administration.
Company Number
5345029
Registered Office
One America Square
Crosswall
London
EC3N 2SG
Phone: +44 (0)207 544 5555
Principal Operating Office:
Suite 7, 6 Richardson Street
West Perth
Western Australia 6005
Nominated Adviser and Broker:
WH Ireland Limited
11 St James Square
Manchester
M2 6WH
Suite 7, 6 Richardson Street
West Perth WA
6005 Australia
Postal Address:
PO Box 1904
West Perth WA
Australia 6872
Telephone +61 8 9481 4204
Facsimile +61 8 9481 0239
Email: mbohm@herenciaresources.com
Total Shares: 1,386,056,376
Last Updated: 28 July 2011
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Updated 4th February 2011
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