Golden Rim Resources Ltd (ASX:GMR) has executed an Option and Joint Venture Agreement with Teck Resources Chile Limitada (Teck Chile), a subsidiary of Teck Resources Limited, on its 100%-owned Loreto Copper Project in Chile.
The agreement allows GMR to leverage off Teck’s exploration and development experience, which could prove highly valuable in future. It also frees GMR up to concentrate on its gold ambitions at Kada in West Africa.
Loreto comprises mineral concessions that have been separated from its Paguanta Silver-Lead-Zinc-Copper Project in northern Chile.
In prolific region
It lies at the northern extension of Chile’s West Fissure - the world’s largest concentration of major porphyry copper-molybdenum deposits and Golden Rim’s exploration has identified a highly prospective 2.3 x 1-kilometre alteration centre at Loreto which has the potential to host a deeper porphyry copper deposit.
GMR has granted Teck Chile an option to acquire a 55% interest in Loreto. Teck may exercise this First Option by incurring an aggregate of US$5 million in expenditures on Loreto and by making US$600,000 in cash payments to Golden Rim.
If Teck Chile exercises the First Option, it will be given a further option to acquire an additional 20% interest in Loreto, by incurring an additional US$12 million in expenditures over a four-year period.
In essence, Teck Chile has been granted options to earn up to a 75% interest in Loreto by making US$600,000 in staged cash payments (~A$800,000) to Golden Rim and spending US$17 million on exploration (~A$23 million).
Provided that Teck Chile exercises the First Option, a corporate joint venture will be formed between Teck Chile and GMR.
Teck must meet the following for the JV to occur:
It should be noted that mineral concessions that cover the measured, indicated and inferred mineral resource of 2.4 million tonnes at 88 g/t silver, 5.0% zinc and 1.4% lead for 6.8 million ounces of silver, 265 million pounds of zinc and 74 million pounds of lead at Paguanta are not included in the agreement with Teck Chile.
Golden Rim is pursuing an alternative transaction on the Paguanta mineral concessions.
"Surrounded by BHP and Codelco"
“Golden Rim believes that Loreto could well represent the last unexplored outcropping Oligocene-Eocene porphyry system in northern Chile,” Golden Rim’s managing director Craig Mackay said.
“Not surprisingly, Loreto is surrounded by BHP and Codelco, two of the largest copper companies in the world.
“Golden Rim is very pleased to execute this agreement with Teck, one of Canada’s leading mining companies, to explore Loreto. Teck has two major copper operations in Chile, including the Quebrada Blanca Mine, located 120 kilometres south of Loreto along the West Fissure.
“The Option and Joint Venture Agreement allows Golden Rim to leverage off Teck’s significant porphyry copper exploration and development experience. With the ability to retain an interest in Loreto, Golden Rim gets to share in the upside should Teck make a significant copper discovery.
“The agreement also allows us to deliver value from the project while focusing on growing our gold inventory at the Kada Gold Project in Guinea.”
Location of Golden Rim’s Loreto Project and the newly redefined Paguanta Project in northern Chile on satellite imagery. An IP chargeability image overlies the satellite imagery in the Patricia area.
More about Loreto
Loreto region hosts the world’s largest known concentration of major porphyry copper and molybdenum deposits.
The project is:
- 30 kilometres northeast of BHP’s Cerro Colorado Mine (measured and indicated resources of 519 million tonnes at 0.55% copper);
- 130 kilometres north of Collahuasi (Anglo American and Glencore; measured and indicated resources of 2.34 billion tonnes at 0.66% copper); and
- Quebrada Blanca (Teck/Sumitomo/ENAMI; proven and probable reserves of 1.43 billion tonnes at 0.51% copper, 0.021% molybdenum and 1.36 g/t silver in addition to measured and indicated resources of 3.59 billion tonnes at 0.37% copper, 0.016% molybdenum and 1.11 g/t silver, and inferred resources of 3.11 billion tonnes at 0.35% copper, 0.017% molybdenum and 1.12 g/t silver).
The Loreto mineral concessions are 100% owned by Golden Rim and extend over an area of 16 square kilometres. These concessions cover the Loreto porphyry copper target and prior to the agreement with Teck Chile, they formed part of the Paguanta Project.
The remainder of Paguanta mineral concessions extend over 39.2 square kilometres and comprise the Paguanta Joint Venture between Golden Rim (75% interest) and Chilean company, Costa Rica Dos (25% interest).
Paguanta JV mineral concessions cover the measured, indicated and inferred resource of 2.4 million tonnes at 88 g/t silver, 5.0% zinc and 1.4% lead at the Patricia Prospect, along with the Cumbre silver-lead-zinc prospect (possible southern extension to the resource), and Patricia East, Rosa and Doris porphyry copper prospects.
Whilst exploration at the Loreto porphyry target has been limited, the region has been on the radar of the major companies which tightly hold the area surrounding Paguanta, including BHP, Anglo American, Glencore, Vale and Freeport.