Quinchia Gold Project
The Quinchia Portfolio is located in central west Colombia, 100km south of Medellin (Figure 1), in the department of Risaralda and in a district known for its high grade epithermal and breccia hosted gold/silver, and porphyry hosted gold/silver/copper systems. The Quinchia Portfolio is located within the same structural trend (Mid-Cauca porphyry gold belt) as the Marmato Gold Mine and the La Colosa gold project which hosts gold resources of 14 million and 29 million ounces respectively. The Quinchia Portfolio covers 10,542Ha consisting of granted titles and applications and includes deposits and targets such as Miraflores, Chuscal, Dosquebradas and Tesorito. Approximately 40,000m of drilling has occurred at Quinchia and includes an established 877koz Resource and 457koz Reserve at Miraflores.
Included within the Quinchia Gold Project is the Chuscal porphyry/epithermal prospect. Los Cerros are earning a 51% interest in the Chuscal prospect through exploration investment.
Figure 1: Locality Map: Key Targets – Quinchia Gold Project
The Miraflores Project is the most advanced project in the Company’s portfolio. On 30 October 2017 the Company released the Miraflores Feasibility Study and on 27 November 2017 released a revised Reserve Calculation for the project
In summary, the Feasibility Study considered an underground mining operation generating 4.3Mt of mineralised material at a head grade of 3.3g/t gold over 9.3 years to deliver 421,000ozs recovered gold. Capital costs were estimated at US$72 million and operating costs were estimated at AISC of US$643/oz. At a gold price estimate of US$1,300/oz. over the life of the operation, the Study generated an NPVof US$72 million (at 8% discount rate) and paybackof 3.6 years.
The Miraflores Project Mineral Resource estimate has been estimated by Metal Mining Consultants in accordance with the JORC Code (2012 Edition) and first publicly reported on 14 March 2017. The Miraflores Project Ore Reserve estimate has been estimated by Ausenco Limited in accordance with the JORC Code (2012 Edition) and first publicly reported on 27 November 2017. No material changes have occurred after the reporting of these resource estimates since their first reporting.
Miraflores Mineral Resource Estimate, as at 14 March 2017 (100% basis):
||Oz Au (000's)
||Oz Ag (000's)
|Measured & Indicated
1) Reported at a 1.2 gpt gold cut-off.
2) Mineral Resources estimated by Metal Mining Consultants Inc.
3) First publicly released on 14 March 2017. No material change has occurred after that date that may affect the JORC Code (2012 Edition) Mineral Resources estimation and Los Cerros confirms that all material assumptions and technical parameters applicable to the Reserve continue to apply.
4) These Mineral Resources are inclusive of the Mineral Reserves listed below.
5) Rounding may result in minor discrepancies.
Miraflores Mineral Reserve Estimate, as at 27 November 2017 (100% basis):
||Oz Au (000's)
||Oz Ag (000's)
1) Rounding of numbers may result in minor computational error, which are not deemed to be significant.
2) These Ore Reserves are included in the Mineral Resources listed in the Table above.
3) First publicly released on 27 November 2017. No material change has occurred after that date that may affect the JORC Code (2012 Edition) Ore Reserve estimation and Los Cerros confirms that all material assumptions and technical parameters applicable to the Reserve continue to apply.
4) Source: Ausenco 2017.
Los Cerros formed a joint venture with AngloGold Ashanti Colombia SA (AngloGold) in late 2018 to explore the large Chuscal porphyry/epithermal gold target. Chuscal is located approximately 2 kilometres from the proposed Miraflores processing plant in the Quinchia Gold Project in the Mid-Cauca Gold Belt in Colombia. Chuscal features an extensive, undrilled surface gold geochemical anomaly (rock-soils and rock chips) with high grade sample results (up to 54 gpt Au). The samples in the Central Zone at Chuscal average 2.66 gpt Au (uncut) and this lies within a large (900m by 530m) envelope averaging 1.76 gpt (uncut) (refer ASX release dated 6 December 2018).
A review of previous underground sampling has revealed two mineralisation populations which reflect an early phase of stockwork / disseminated mineralisation (porphyritic diorite) with an average grade of approximately 1.5 gpt Au; cut by a later high-grade epithermal vein population with an average grade of approximately 8 gpt Au using a 20 gpt Au top-cut (uncut: 19 gpt Au) (refer ASX release dated 21 January 2019).
Tesorito is located approximately 1 kilometre to the north of Chuscal and only several hundred metres from the proposed processing facility described in the Miraflores feasibility study. Los Cerros drilled the Tesorito gold porphyry prospect in 2018. Tesorito is regarded as an outcropping medium grade (1gpt to 1.7gpt) gold porphyry system. Diamond drill hole TSDH-02 reported 384m @ 1.01gpt Au from surface to end-of-hole (refer to ASX announcement of 30 August 2018) and TSDH-07, 253.1m @ 1.01 gpt Au from 2.9m, including 64.0m @ 1.67 gpt Au from 144m. Tesorito will be progressed within the context of the broader Chuscal exploration program.