Golden Arrow Resources Corp (TSX-V:GRG, OTCQB:GARWF) has an ability to transform seemingly modest projects into economically viable mines.
That strength is evident in Chile and Argentina, where the team is working on some highly promising assets. In order to appreciate the group’s strategy to advance these projects, it is best to look at the past.
Joseph Grosso, Golden Arrow’s executive chairman, CEO, and president is a seasoned figure in the mining sector of Argentina. Since 1993, he has played a pioneering role in the country's mining industry, earning recognition as Argentina's 'Mining Man of The Year' in 2005.
Grosso's expertise extends to successful negotiations and strategic alliances with major industry players such as Barrick, Teck, Newmont, Viceroy (now Yamana Gold (TSX:YRI, LSE:AUY)), and Vale, as well as engagement with government officials at various levels.
From Chinchillas to San Pietro
Grosso has had a long and successful track record in Argentina, most recently helping to monetize the company’s Chinchillas asset via a sale to Silver Standard Resources, now SSR Mining (SSR). Today, Chinchillas is a silver-lead-zinc deposit which achieved commercial production in December 2018 as part of Puna Operations run by SSR.
But for a while, Chinchillas wasn’t expected to be much of a company-maker – it wasn’t big enough in the eyes of many mining insiders, said Brian McEwen, vice president exploration and development at Golden Arrow.
McEwen, a professional geologist with over 35 years of experience, has a global background managing diverse mining projects across Canada, the US, Europe, Asia, Africa, and Latin America.
“We demonstrated that the project could be economic and mineable, and is now an active mine,” McEwen told Proactive.
The sale to SSR gave Golden Arrow the funds needed to go off and search for new projects. This work led to the company’s new flagship San Pietro iron oxide-copper-gold-cobalt project: a large property in a potential new copper-cobalt district in Chile. It is a promising target open for expansion and is being rapidly advanced towards resource delineation. There’s an operating mine to the east and an advanced project to the west that are both owned by Capstone Mining. Right in between: San Pietro’s 20,000 hectares of prime land. “You can’t find a better location to develop a mine,” McEwen said.
A partnership to advance San Pietro
But the markets haven’t been kind to junior resource companies lately, regardless of how great the asset, companies must find creative ways of moving their projects forward.
Earlier this year, Golden Arrow’s subsidiary, New Gold Explorations Chile (NGE), entered an option agreement with drilling company Sociedad de Servicios Andinos (SSA) to advance San Pietro. Under the terms of the deal, SSA has the option to subscribe for a 25% stake in San Pietro by contributing US$5 million, comprised of US$2 million in six cash installments starting February 1, 2024, and providing US$3 million in drilling and related services by July 2025.
This option agreement equates to a non-dilutive financing of approximately C$7 million, which enables Golden Arrow to pursue an aggressive exploration and drilling program at San Pietro, aiming for a mineral resource estimate completion by year-end.
“(SSA) is looking to make more money than just through drilling. They’ve done their due diligence on the property and see the upside as investors as well,” McEwen explained.
“From our point of view, we’ve got a good partner who’s got some serious skin in the game, and they’re going to want us to be successful. It’s a fantastic way to go.”
In the coming weeks, Golden Arrow plans to delve deeper into the project’s many targets with a focus on the Rincones area. This target, pivotal in historical efforts, witnessed drilling of 46 widely spaced holes across an area measuring approximately 2.6 by 1.6 kilometers, yielding numerous significant intervals of copper, gold, and cobalt. The historical drill holes were categorized into northern and southern groups, with a central area experiencing minimal drilling activity.
During its inaugural 4,000m drill program in 2023, Golden Arrow completed six of its 13 holes, including in the previously undrilled centre of the target area. Through the company's efforts and interpretations, mineralization appears to extend in all directions. Currently, a new 3D geological model is in development, aimed at defining priority targets for the next upcoming drilling phase. Drilling is slated to start in March at a rate of approximately 60 meters a day.
A new era in Argentinean mining?
At the same time, the company’s focus extends to its other projects and joint venture partnerships in Argentina. Golden Arrow has interests in multiple assets in or near some of the most prospective copper-gold belts in the country.
It’s an interesting time to be exploring in Argentina. New President Javier Milei, who assumed office last December, is advocating for reduced bureaucracy, elimination of customs and capital restrictions, and other regulatory reforms to attract investors, as evidenced by deregulation measures he unveiled before the end of 2023. Mining investors are hopeful that the changes, if implemented, would reduce risks for investors, who currently remain cautiously optimistic.
McEwen is looking at the situation through the eyes of an experienced investor in Argentina.
"I believe Argentina presents significant opportunities. The new president seems to have brought back a renewed interest in the country.”
As McEwen noted, each province in Argentina has its mining laws. But in general, tax incentives proposed for large Argentine infrastructure projects in Milei's legislation could play a crucial role in attracting partners, providing additional taxation stability for future financing discussions with the international community. What’s more, Milei's commitment to boosting mineral exports aligns with a pro-business stance, potentially creating a conducive atmosphere for the development and operation of mining projects.
“The overall outlook is positive, especially in mining-centric provinces, with the expectation that conditions will continue to improve,” McEwen said.
“Along with some of our peers, we share a collective optimism for quality projects and anticipate a bright future in Argentina."
With numerous initiatives underway and a flagship project, San Pietro, that is well-funded and progressing, Golden Arrow is leveraging its projects in Chile and Argentina as some of the most sought-after mineral properties in the region.
“Despite the challenging times, 2024 holds great promise for us,” McEwen said. “We are optimistic about the positive developments ahead."
Photos of San Pietro courtesty of Golden Arrow Resources