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Metminco enters JV to develop Colombian gold project with AngloGold

The Chuscal target is part of the Quinchia Gold Project which comprises three 100% Metminco-owned gold deposits.

The Quinchia Gold Project is 100 kilometres south of Medellin

Metminco Limited (ASX:MNC) has entered into a joint venture (JV) agreement with AngloGold Ashanti Colombia SA to explore and develop the Chuscal Gold Project in Colombia.

Chuscal is a drill-ready gold exploration target defined by anomalous gold levels in both soil and rock chip geochemistry.

The target is 1,700 metres south of Metminco’s proposed plant at Miraflores and, along with Tesorito, is a prospective area within a 3-kilometre radius of Miraflores.

Drilling is expected to begin once exploration titles are granted and permits and approvals are obtained, which Metminco anticipates will occur in the second quarter 2019.

AngloGold Colombia is a subsidiary of AngloGold Ashanti Ltd (NYSE:AU) and owns gold and uranium assets.

READ: Metminco launches rights issue to advance Quinchia Gold Project

Metminco executive chairman Kevin Wilson said the Chuscal target represented a major opportunity for the company.

He said: “It complements our existing gold resource at Miraflores and the target at Tesorito.

“We look forward to working with our partner at AngloGold to explore and develop this exciting addition to our portfolio in Quinchia.”

The Quinchia Gold Project


READ: Metminco focused on its portfolio of gold assets at Quinchia in Colombia

Chuscal features a large, undrilled surface gold geochemical anomaly with high-grade samples up to 54 g/t, within a large lower-grade envelope.

Channel sampling from a small-scale underground mine indicated continuous and highly encouraging grades beneath the target zone.

Rock chip sampling has defined a central zone of 600 by 240 metres from 183 samples, with an average grade of 2.66 g/t uncut or 1.94 g/t cut.

This zone is incorporated within a broader main zone of 900 by 530 metres, where analysis of 289 samples has the average grade at 1.79 g/t uncut or 1.33 g/t cut.

The rock chip sampling indicates the potential for high-grade mineralisation within the central zone where 12 of the samples encountered grades over 10 g/t and six reported grades over 20 g/t, with the highest at 54 g/t.

READ: Metminco completes first leg of nickel acquisition financing

Metminco will initially hold 10% ownership and can earn a further 41% by spending US$2.5 million over 3 years, including at least 7,500 metres of drilling.

Metminco will manage the JV and AngloGold will be free-carried during this period.

AngloGold has a one-off right to buy back a 21% interest from Metminco on the publication of a JORC resource of at least 3 million ounces of gold.

On exercise of the buyback right AngloGold will hold 70% of the project and become manager of the JV.

AngloGold will then free carry Metminco through feasibility and until permits have been granted for a plus-250,000-ounce annual production development proposal.

READ: Metminco eyes sizeable operation in Colombia as it hits highest grades yet at Tesorito

The Chuscal target is part of the wider Quinchia Gold Project which also contains the 100% Metminco-owned Miraflores and Dosquebradas deposits as well as the recently-drilled Tesorito prospect.

Miraflores has an 880,000-ounce gold resource and is subject to an ongoing environmental impact assessment and Dosquebradas has a 920,000-ounce gold resource estimated under NI 43-101.

Tesorito recently delivered broad gold grades of 253 metres at 1.01 g/t from surface, including 64 metres at 1.67 g/t from 144 metres.

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