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Artha Resources Corporation: Argentina-Aguilar Option/JV Signed
By: Marketwired .
Nov. 5, 2012 09:01 AM
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 11/05/12 -- Artha Resources Corporation (TSX VENTURE:AHC) ("Artha" or the "Company") is pleased to announce that the Company has signed an Option/JV Agreement with Teck Argentina Ltd. ("Teck") whereby Artha (through its Argentinean subsidiary, Minera Argentina del Norte S.A.) has been granted the option to acquire a 100% interest in Teck's Aguilar property located in Jujuy Province, NW Argentina. Artha considers this Agreement to be a further step towards its strategic goal of becoming the prominent explorer in one of the more prospective under explored regions of northern Argentina. Artha now has property positions adjacent to the two largest operating mines in the Province of Jujuy, namely Silver Standard's Pirquitas silver mine and Glencore International's Aguilar-Esperanza lead-zinc-silver mine. Both of these areas are highly prospective and have excellent potential for the discovery of precious and base metal mineral deposits. Artha intends to focus its initial exploration efforts at this new property on identifying near-surface targets along strike from the known Aguilar and Esperanza deposits, which remain largely unexplored by modern methods.
The Aguilar property is located some 170km NNW of the city of Salta in northern Argentina (see map 1). Claims totalling 118,000 ha cover a 55 km long by 20 km wide belt of Early to Mid-Ordovician stratigraphy that hosts the Aguilar-Esperanza Zn-Pb-Ag mines (see map 2). Estimated past production plus current mine resources from these two mines total approximately 50Mt @ 6% Zn, 5% Pb, 100 g/t Ag (greater than 5Mt of contained Zn+Pb and over 150 Moz of contained Ag), ranking the Aguilar-Esperanza deposits amongst the largest Paleozoic-aged SEDEX orebodies in the world. Historical production estimates and the current resources from the Aguilar-Esperanza Zn-Pb-Ag mines are not necessarily indicative of the mineral potential of the Aguilar property and/or its commercial economic viability.
The Aguilar deposit has been in operation for over 100 years, with new mine reserves still being added at depth and along strike through the employment of modern exploration methods. Exploration in the belt has been focused principally around the two known deposits (Aguilar and Esperanza), located within a 7 km long mineralized corridor of outcropping ore-host stratigraphy of Early Ordovician age. Teck explored the areas immediately north and south of Aguilar-Esperanza between 1997 and 2001 in partnership with Rio Tinto, before reacquiring the same licences in 2006 on a 100% basis. During this period surface mapping, lithofacies studies, regional magnetic surveys, stream geochemistry surveys, ore deposit studies, IP surveys and a small program of diamond drilling was conducted in close proximity to the known mines. The majority of the along strike areas from the known deposits are still unexplored. The data collected by Teck is being made available to Artha and is expected to provide important technical data on the SEDEX style of mineral deposits which occur at Aguilar and Esperanza. Artha considers the work to date to be of high quality and is expected to deliver insights for targeting new and unexplored areas in the mineralised belt, particularly to the north of Esperanza where no modern work has been done to date.
Mineralization on the Aguilar property is hosted by strongly folded and faulted, N-S striking early Ordovician quartzites and hornfels in the contact aureole of the immediately adjacent, north-south trending Cretaceous Aguilar granite. The ores are associated with sediments formed in local depressions of a tectonically active, shallow-marine environment and consist of strata-bound and stratiform sulfide lenses and layers several hundreds of meters long and wide, and tens of meters thick.
Current geological models suggest that during Early Ordovician times rift basins developed in Pre-Cambrian basement on the leading edge of the proto-South American continental margin. First and second order rift basins were controlled by N-striking listric (growth) faults into which sub-seafloor / inhalative (Aguilar) and exhalative (Esperanza) Zn-Pb-Ag mineralization was deposited during marine sedimentation. Detailed depth-to-magnetic-basement modelling of airborne magnetic data, commissioned by Teck, show the existence of several fault-bounded second order basins in the Sierra de Aguilar. The Aguilar and Esperanza ore bodies occupy just two of these second-order sub basins. The Aguilar property covers the majority of the remaining second-order basins, many of which still remain unexplored.
The Option/JV Agreement provides that, subject to TSX Venture Exchange ("TSX-V") approval, Artha may exercise the option by:
a. issuing to Teck such number of units in the capital of Artha as have an aggregate value of $125,000. Each unit will be comprised of one common share in the capital of Artha and one common share purchase warrant, each of which warrants will entitle Teck to purchase one common share of Artha for $0.125 for a period of two years. The value of the units will be determined from the price of the Artha common shares listed for trading on TSX-V and will be deemed to have a price per unit equal to the greater of the 10-day volume weighted average closing price of the Artha common shares on the TSX-V immediately prior to the date of the press release announcing the Option/JV Agreement and $0.05 per share; and b. incurring exploration expenditures of at least US$2,875,000 by October 31, 2015, which includes: i. as a firm commitment, incurring expenditures aggregating: A. US$100,000 on or before October 1, 2013; and B. US$500,000 on or before October 1, 2014; ii. as a firm commitment, completing a minimum of 4,000 meters of diamond drilling or combination RC/diamond drilling on the property prior to October 31, 2015.
Pursuant to the Agreement, Teck reserves for itself a 2% net smelter returns (NSR) royalty on the ores and concentrates derived from the Aguilar property. In addition, Teck has the right to earn back 60% of the interest that Artha acquires in the property. The back-in right may be exercised by Teck at any time after Artha has incurred US$1,000,000 in exploration expenditures under the Agreement until 60 days after Artha gives notice to Teck that it has exercised its option to earn 100%, at which point the back-in right expires if unexercised. The 60% interest may be earned by Teck incurring exploration expenditures on the property equal to 2.5 times Artha's expenditures to the notice date; provided, that if Teck exercises the back-in right, then the 2% NSR royalty shall be extinguished. Finally, the Agreement provides that Teck shall have an offtake right to purchase, by way of frame contracts, all or part of the base metal mineral production from the Aguilar property.
Charles Straw, B.Sc., is the qualified person under NI 43-101 responsible for the technical information in this news release.
Artha was founded by a team of mining industry professionals with a proven track record in project generation, exploration, mining and finance. The team's primary goal is to build Artha into a world class mining company, focused on the discovery, development and mining of economic minerals deposits globally.
On Behalf of the Board of Directors,
Todd McMurray, President
This press release contains forward-looking information within the meaning of the British Columbia Securities Act relating to the Company's expectations, intentions, plans and beliefs. Forward-looking statements include statements regarding the Company's exercise of the Aguilar option and the exploration and development of the Aguilar property. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results to be materially different from any future result expressed or implied by the forward-looking statements. Factors that may cause actual results to vary include, but are not limited to, risks inherent in mineral exploration and development including environmental hazards, unusual or unexpected geological formations; risks associated with the estimation of mineral resources and reserves and the geology, grade and continuity of mineral deposits; the Company's inability to obtain the required licences, permits and regulatory approvals required for the exploration and development of the Aguilar property; uncertain political and economic environments; changes in laws or policies; completion for capital and skilled workers; and changes in commodity prices and exchange rates. The Company does not assume the obligation to revise or update these forward-looking statements after the date of this document or to revise them to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.
To view Maps 1 and 2, click on the following link: http://media3.marketwire.com/docs/Artha-property-Locations-Argentina.pdf
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
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