Oroco has acquired, through its wholly-owned subsidiary, Minera Xochipala, S.A. de C.V. (“MX”), a 77.5% interest in each of the La China II and Amp. Santo Tomás Reduccion 1 mineral concessions and a 77.5% interest in an application for the Papago 17 mineral. In aggregate, the three properties (the “Properties”) comprise approximately 6,978 ha and abut and surround the Santo Tomás copper porphyry property in Sinaloa, Mexico (the “Santo Tomás Concessions”).
In 2017, the Company initiated a program of mineral exploration in the Santo Tomás mineral camp with surface geological mapping and the assembly of historical drilling information on the Properties and the Santo Tomás Concessions. Additionally, Auracle Geospatial Science, Inc. was contracted to task MDA’s RadarSat 2 satellite for the acquisition of Synthetic Aperture Radar (“SAR”) data for the entire camp.
Phase One of the Company’s exploration work is now complete. Modeling by Auracle of the SAR data has confirmed and significantly enhanced the structural geology results from the 2017 field mapping by the Company. Historic drilling indicates a well-mineralized zone of quartz monzonite dikes and hornfelsed andesite of the Santo Tomás mineralization zone passes southward from the Santo Tomás Concessions onto the Papago 17 area.
Phase One work also confirms that the Santo Tomás mineralization zone extends northward from the Santo Tomás Concessions onto the Amp. Santo Tomás Reducc. 1 concession, as evidenced by prominent gossans and copper oxide showings. Historically, three rotary drill holes were collared by Exall on Amp. Santo Tomás Reducc. 1 but were not reported publicly.
The Santo Tomas project, located in northern Sinaloa State Mexico, hosts a porphyry copper deposit, comprised of fracture and disseminated Cu and Mo sulphides, with significant Au and Ag credits. The deposit lies within the Laramide Belt, a NW-SE trending copper belt extending from southwestern USA into southern Mexico, that includes numerous world-class copper deposits, including the Cananea district, one of the largest copper deposits and producers in the world.
The deposit was defined by active exploration from 1968 to 1994. During that time Santo Tomas was tested by 106 diamond and reverse circulation drill holes totaling approximately 30,000 meters. In 1994, at the request of Exall Resources Limited (“Exall”), then an optionee of the Santo Tomas project, a resource estimated was conducted by Mintec, Inc. of Tucson, Arizona. In conjunction with this estimate, metallurgical testing was conducted by Mountain States Research and Development, Inc. (“MSRDI”) and in reliance on information generated by these studies, a Prefeasibility Study was conducted by Bateman Engineering Inc., E&C Division of Tucson, Arizona. This report contemplated mining rates of 60,000, 90,000 and 120,000 TPD, producing between 150 million and 300 million pounds of copper per year, plus quantities of gold and silver, in a high-quality concentrate. Conventional open pit mining, hauling and ore beneficiation technology is scoped in the design, with no design risks implied. The Prefeasibility Report yielded a positive result. The results of this study were disclosed by Exall in July, 1994.
The Santo Tomás mineral camp is characterized by copper porphyry and skarn/replacement style mineralization linked to the Laramide Orogeny (80-40 Ma age). The Santo Tomás Cu-Mo-Au-Ag porphyry deposit lies mostly on the Santo Tomás Concessions and is associated with a NNE-trending zone of quartz monzonite porphyry stocks and dikes, hosted in Cretaceous limestone and metamorphosed andesite. The deposit is primarily comprised of chalcopyrite, pyrite, and molybdenite sulfides with lesser bornite and chalcocite sulfides. Minor oxide copper occurs on surface. Taken together, the porphyry intrusions and mineralization comprise the Santo Tomás mineralization zone.
The Santo Tomás mineralization zone is mapped on surface and drill tested along a strike length of 4 km on the Santo Tomás Concessions and Papago 17 area. Oroco has assembled information from historic diamond drilling, rotary and reverse circulation holes from exploration programs spanning 1968 to 1993. In 1994, Mintec, Inc. prepared a mineral resource estimate based on assay information from 14,881 meters of drilling in 49 drill holes drilled by ASARCO and Tormex–Peñoles, and 40 drill holes drilled by Exall Resources Limited.
In 1994, Exall commissioned Bateman Engineering Inc. to conduct an economic assessment of the Santo Tomás project, based on technical work by a team that included Mintec, Inc., Mountain States Research and Development, Inc., and Minetek S.A. de C.V. Bateman completed this study, termed “Santo Tomás Project, Sinaloa, Mexico, Pre-Feasibility Study”, in July 1994, and did not use any inferred mineral resource estimates in its work.
The economic assessment by Bateman contains favorable metallurgical test results and engineering designs that remain broadly acceptable today. However, the Company considers these historical economic studies and associated mineral resource estimates to be conceptual in nature only, until confirmed by current technical programs.
The Santo Tomas Project is located in the municipality of Choix, on the south bank of the Fuerte River, in the western Sierra Madre mountain range, in northern Sinaloa near the State border of Chihuahua. The Port of Topolobampo (160 km), the city of Los Mochis, the major rail lines (black), the power transmission lines, the highways, the Huites Dam and the city of Choix are identified.