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Thursday, 14 March 2013
Gold Resource Corp significantly adds to exploration potential with two property acquisitions in Oaxaca
Gold Resource Corp (NYSE MKT:GORO) says it has acquired two gold and silver properties in Oaxaca, Mexico fromAlmaden Minerals (TSE:AMM), boosting its foothold in the region.
Both properties are located along the mineralized trend of which the company has land concesssions of 48 kilometres along strike. Shares of Gold Resource added 22 cents, or nearly 1.7 percent, to trade at $13.22 early Thursday afternoon.
Under the terms of the deal, the U.S.-based gold producer will get a 100 per cent interest in the Cerro Colorado and El Fuego properties for $100,000 in cash. Almaden will have a 2% net smelter royalty on any future production from the assets.
As well as adding these two properties, Gold Resoure Corp has terminated its lease on the Solaga property north of its producing El Aguila project in Oaxaca.
The company has returned more than $75 million to shareholders in monthly dividends since declaring commercial production at El Aguila in July 2010, and gives shareholders the option to convert their cash dividends into physical gold and silver.
The new Cerro Colorado property consists of 1,860 hectares and will become part of the company’s large, existing El Chamizo land concession. It says that anomalous gold and silver values exist in rock chip samples at the Cerro asset.
The El Fuego property is spread across 2,554 hectares and is located south of the company’s Alta Gracia and El Chamizo properties along the North 70 West mineralized corridor. Surface samples from Almaden from old mine dumps came in as high as 29.9 grams per tonne gold and 953 grams per tonne silver.
This possible scenario fits the junior producer's geologic model, where the top of the mineralized horizon in this epithermal system, like its Arista deposit at El Aguila for example, is below the current land surface by roughly 100 metres.
“We are pleased to further consolidate our dominant land position with these two prospective properties along what we believe to be a very important mineralized trend,” said the company in its statement, citing president Jason Reid.
“By dropping Solaga, adding the new Cerro Colorado to our much larger Chamizo property and adding the El Fuego Property to our portfolio, our Oaxaca Mining unit will now focus entirely on this mineralized trend with six total properties covering over 200 square miles."
The company's president added that with Gold Resource Corp's understanding and geologic model of the area, the company believes both new properties will "significantly add" to its exploration potential.
In the meantime, Gold Resource says its focus remains on exploration and production from El Aguila, as well as continued exploration and development of its Las Margaritas, Alta Gracia and El Rey properties.