Canadian junior Exeter Resource Corp. announced a proposal in mid-January 2010 to spin off its Argentine assets into a new company, Extorre Gold Mines Ltd., while retaining its huge Caspiche porphyry gold-copper project in the Maricunga region of Chile as its core asset. Under the terms of the transaction Exeter will retain all assets relating to the Caspiche discovery, together with approximately $50 million in working capital. Exeter will transfer to Extorre the high-grade Cerro Moro gold-silver project and other Argentine exploration properties and approximately $25 million in working capital.
Exeter shareholders were scheduled to vote on the proposal on March 11, 2010. If approved, the transaction will result in each Exeter shareholder on the effective date of the transaction (expected to be on March 12, 2010), receiving one share in Extorre for each share held in Exeter on that date.
The Caspiche project is located 15 km south of Kinross Gold’s Refugio mine in Chile and has an estimated inferred mineral resource of 1.1 billion mt grading 0.55 g/mt gold and 1.12 g/mt silver, including 1 billion mt grading 0.22% copper. This equates to in-situ inferred resources of 19.6 million oz of gold, 40 million oz of silver, and 4.84 billion lb of copper, or approximately 32.4 million gold equivalent oz. Six drill rigs are currently at work on the property to expand and upgrade the resource, and mine development studies are in progress.
The Caspiche deposit is described as a stockwork-hosted, gold-copper porphyry, with a telescoped high-sulphidation epithermal gold mineralization style overprinting the upper portion of the system. Copper has been almost totally leached from the relatively flat-lying oxide zone, making it suitable for heap leaching. The gold-copper sulphide material at depth suggests a gold-copper flotation recovery path.
The Cerro Moro project in Santa Cruz province, Argentina has current estimated inferred mineral resources of 646,000 gold equivalent oz at a grade of 18 g/mt gold equivalent oz. A new Cerro Moro resource estimate is scheduled for April 2010, to be followed by a Preliminary Assessment Study that will form the basis of a mine development decision and the submission of the project to Provincial authorities for permitting.
Low-sulphidation epithermal gold and silver mineralization at Cerro Moro is primarily associated with a number of quartz-bearing veins that strike over distances ranging between 240 and 1250 m. The silver content of the mineralization is frequently considerable, with many trench and drill holes assaying in excess of 500 g/mt silver. Extorre intends to increase the Cerro Moro resource by drilling the many partially explored veins on the property.