Altiplano Metals Inc (TSX-V:APN, OTC:ALTPF) acquired the Farellon copper-gold mine near La Serena, Chile in 2017, which has produced mineralized material of both metals from a series of underground workings at numerous levels.
For the Edmonton-based company, the investment continues to pay off.
During the third quarter of 2021, which ended September 30, the company extracted a total of 11,624 tonnes of mineralized copper and gold material and processed 7,635 tonnes at an average copper grade of about 1.38%. Sales of 221,518 pounds of copper generated approximately US$561,000 in revenue (after processing costs).
Furthermore, Altiplano recently announced a major advancement in its exploration program at Farellon that confirmed the down-dip extension of a copper sulphide vein system. The company plans a 6,200-meter drill program to test the structure.
The company is also advancing two other projects at Farellon.
It recently completed the expansion of the Hugo Decline to the 360-meter (m) working level to provide two new mining access points along the northeast and southwest drifts where mining has begun. The work is being conducted in tandem with diamond drilling and ventilation efficiency improvements.
Altiplano is also moving ahead with its other gold-copper asset and revenue source in Chile - Maria Luisa, near the town of Incahuasi. The company has secured an exploration permit as it mulls plans to begin the surface and underground work needed to start a decline tunnel.
Altiplano CEO Alastair McIntyre recently discussed its ongoing operations and plans for 2022 with Proactive Investors.
Proactive: Initial results from eight drill holes at the Farellon copper-gold mine in Chile have confirmed the continuation of a copper sulphide vein system. How significant are these findings and what next steps are planned?
Alastair McIntyre: This is an important step for us. We purchased a drill rig several months ago to provide us the opportunity to drill at Farellon and with its mobile nature we can take this to other sites. The drilling work at Farellon is important as we have been able to confirm the down-dip extension of the Iron Oxide Copper Gold (IOCG) vein structure and along strike. We’ve designed a 6,200m drill program to test the vein structure in three locations. Two of these locations are underground in the nearby Laura decline and to date, we’ve drilled about 2,000m. This work will guide us with grade control and future development underground at Farellon. We are currently mining at the 360m level and with intercepts located 28m below these levels, this provides additional tonnage for mining.
The assay results from the first seven holes have returned very encouraging results with grades from 0.63% copper to 2.54% copper and over a range of widths from 1.70 to 5.50m. These numbers are in line with what we’ve seen in previous drilling higher up in the vein structure and are consistent with what we are seeing from the grade that we see from ongoing mining. Overall, since 2018, the grade we have observed from our mining operations at Farellon has averaged around 1.77%.
Also at Farellon, the company in September completed the planned expansion of the Hugo Decline to the 360-meter working level. What does Altiplano hope to accomplish with this work? Does the company plan to further expand the decline?
The extension of the Hugo Decline to the 360m level was completed in September and is part of our ongoing development plans to drive to lower levels of the vein structure. The 360m level provides an additional opportunity to mine along the vein structure in the NE and SW directions thus providing two new operating headings to extract copper-gold material. We can then operate on multiple headings as we advance deeper in the decline while bench mining the roofs and floors from the levels above. This method maximizes grade control of the mined material. Our next planned development will be to advance to the 352m level which will begin in a few weeks.
Altiplano is now advancing its processing facility at the El Peñón mill site at Farellon. How are construction and assembly progressing and when does the company intend to produce its first concentrate?
We obtained the construction permit in late August and commissioned the work soon after. We purchased the processing facility late last year which includes crushing equipment, ball mills and a flotation plant. We also completed the civil work in preparation for this phase which included pouring concrete foundations and footings for the ball mills and crusher, installed power, completed the water line excavation, and installed a security perimeter fence. To date we are about 50% complete with installation of the ball mills, primary and secondary crushers and conveyor systems. We’ve also completed the retaining wall for the primary feed and completed the pad for the storage area. Next steps will include the installation of the flotation cells and full electrical, hydraulic, and mechanical connections. We will also finalize the construction of the plant warehouse and offices and complete the dry tailings storage area. We are expecting that we can get our first concentrate out in early Q1 2022.
Also, at another project in Chile, Altiplano obtained an Exploitation Permit Application for the Maria Luisa gold-copper mine. What is the status of operations and future plans for the project?
We received the exploitation permit approval at Maria Luisa in mid-August. This provides us with an excellent opportunity to complement our operations at Farellon and add an additional revenue source. This permit provides the opportunity to begin the surface and underground work required to commence the decline tunnel. The Maria Luisa project location hosts good infrastructure required to support the surface exploration and underground development. This includes power located within 3 kilometers (km) of the town of Incahuasi and accessible by paved road within 3 km of site. Adequate water supply is available which can be used for drilling and underground operations. Water is also expected to be recirculated from underground as the decline advances to lower levels. We have recently purchased a XC 928 Scoop with 1m capacity bucket as part of the mining equipment to support the underground work.
Since receiving our permit, the company began excavation work at site to prepare for the construction of the decline and recently we have completed about 10m advance on the tunnel. We intend to run daily shifts to reach a total advance of approximately 65m which will provide the first sub drift adit to intersect the NW-SE trending Au-Cu vein system. From this level the company expects to extract gold-copper mineralized material to sell to local processors. The proceeds from these sales can be used to offset some of the initial capital costs of development.
The company is set to option (up to 100%) into the Pastillas gold exploration project, which sits near four advanced, world-class gold assets in Chile’s Maricunga district. Can you provide an update of the project and what the company intends to achieve over both short and long term?
Pastillas is an undrilled and underexplored 3,100-hectare land package with high potential. Pastillas sits in very good real estate from a geology and mining perspective with the Maricunga gold belt hosting numerous world-class gold-copper deposits with producers, past producers and developers of significant stature. Pastillas at an early-stage exploration opportunity that demonstrates a large steam-heated footprint and evidence of a paleo-water table which is consistent with a high-level expression of epithermal mineralization within the region and may also indicate the potential for porphyry mineralization at depth. Our priority will be to develop a surface exploration program to confirm some of these assumptions with a goal of developing drill targets. The company purchased a diamond drill rig in early 2021 specifically to mobilize our teams and equipment to quickly drill test targets cost-effectively. Pastillas fits very well into this type of strategy.
What is the overall strategy and outlook for the company for 2021 and beyond?
Altiplano Metals is a growing gold, silver, and copper company focused on the Americas. We have a diversified portfolio of assets that include an operating copper-gold-iron mine, development near term producing gold-copper projects, and exploration land packages with district-scale potential. We are focused on creating long-term stakeholder value through developing safe and sustainable production, reinvesting into exploration, and pursuing acquisition opportunities to complement its existing portfolio. This is a unique opportunity for investors to gain exposure to cash flow and upside growth through scalable exploration projects. This unique revenue generator model whereby profits are reinvested reduces the exposure to dilution common in the junior exploration sector.
Contact the author: patrick@proactiveinvestors.com
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