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Calibre and Rio Tinto Exploration Enter Into Agreements: $45 Million Earn-In Agreement for 100%-owned Borosi Projects; And Strategic Exploration Alliance for Nicaragua

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Calibre and Rio Tinto Exploration Enter Into Agreements: $45 Million Earn-In Agreement for 100%-owned Borosi Projects; And Strategic Exploration Alliance for Nicaragua

 

 

 

 

 

Calibre Mining Corp. (TSX: CXB) (OTCQX: CXBMF) is pleased to announce that the Company and Rio Tinto Exploration  have entered into an option earn-in agreement dated February 23, 2020, pursuant to which Rio Tinto can earn up to a 75% interest in Calibre’s 100%-owned Borosi Projects in Northeast Nicaragua. The Borosi Projects host both gold-silver and copper-gold resources in two areas as well as multiple lesser explored copper-gold skarns, low-sulphidation epithermal gold-silver vein systems and bulk tonnage copper-gold porphyry targets.  

 

Furthermore, the Company and Rio Tinto have entered into a strategic exploration alliance agreement under which we will work together to identify and acquire exploration concessions in Nicaragua, with a focus on copper-gold porphyry, skarn and epithermal precious metal systems.   

 

All amounts in this news release are expressed in US dollars.

 

Earn-in Agreement Highlights:

 

  • First Option: Rio Tinto shall have a five-year option to acquire a 55% interest in the Borosi Projects by incurring $10,000,000 in qualifying expenditures, of which $3,000,000 is committed to be incurred within two years of obtaining the necessary permits and approvals.
     
  • Second Option: If Rio Tinto exercises the First Option and earns a 55% interest in the Borosi Projects, it has the right to earn an additional 10% interest (for an aggregate interest of 65%) by incurring an additional $15,000,000 over a three-year period.
     
  • Third Option: If Rio Tinto exercises the Second Option and earns a 65% interest in the Borosi Projects, it has the right to earn an additional 10% interest (for an aggregate interest of 75%) by incurring an additional $20,000,000 over a subsequent three-year period.
     
  • Calibre has been designated as the initial operator of the field work being completed under the Earn-in Agreement and will receive a fee equal to 10% of expenditures.

             

Alliance Agreement Highlights:

 

  • Calibre and Rio Tinto entered a five-year generative exploration and concession acquisition alliance under which we will work together to identify prospective mineral properties.
     
  • Rio Tinto has the right to instruct Calibre to acquire selected alliance properties and will fund the acquisition of those properties.
     
  • Calibre will receive a fee for acting as the operator of the alliance equal to 10% of qualifying expenditures.
  • Rio Tinto shall have the right to designate one or more blocks of the alliance properties (each such block not to exceed 40,000 hectares in the aggregate) and shall have the exclusive option to earn up to a 80% interest in each such block, on the following terms and conditions:
     

    • First Option:  Rio Tinto shall have a five-year option to acquire a 55% interest in the applicable block by incurring $5,000,000 in qualifying expenditures.
       
    • Second Option:  If Rio Tinto exercises the First Option and earns a 55% interest in the applicable block, it shall have the right to earn an additional 10% for an aggregate interest of 65%) by incurring an additional $5,000,000 over a five-year period.
       
    • Third Option:  If Rio Tinto exercises the Second Option and earns a 65% interest in the applicable block, it shall have the right to earn an additional 15% for an aggregate interest of 80%) by incurring an additional $15,000,000 over a five-year period.

 

Russell Ball, CEO of Calibre stated: “It is my pleasure to welcome Rio Tinto Exploration as our partner in Nicaragua, a country we believe has both a tremendous geological endowment and is under-explored from a modern exploration perspective.  As one of the world’s premier mining companies, Rio Tinto brings a tremendous global perspective and both the experience and capital necessary to accelerate our value-creation efforts.  I expect this to be a long and mutually beneficial arrangement that adds value for our respective shareholder groups, but more importantly, for the people and the country of Nicaragua.”

 

Calibre’s 100%-Owned Borosi Projects

 

The Calibre Borosi concessions are located approximately 275 kilometres northeast of the capital city of Managua. The concessions cover a total of 667 km2 within Nicaragua’s Mining Triangle, an area defined by the historic mining towns of Bonanza, Rosita and Siuna.  One of Central America’s most prolific mining regions, the Mining Triangle is reported to have produced 7.9 million ounces of gold, 4 million ounces of silver and 305 million pounds of copper.

 

Two historic mines operated on the Borosi concessions as recently as the early 1980s: the La Luz-Siuna mine, which produced approximately 2.3 million ounces of gold; and the Rosita mine, which produced approximately 305 million pounds of copper. Both deposits are skarn-type deposits which are commonly found in proximity to copper-gold porphyry systems. Several smaller past producing gold mines are also located on the Borosi concessions: the La Luna, Riscos de Oro and Blag mines, which are all currently held under the joint venture with Iamgold Corporation.  

 

Calibre’s 100%-owned concessions at Borosi, which total 667 km2, are the subject of the Earn-in Agreement with Rio Tinto. The concessions include the formerly producing La Luz-Siuna mine, the Santa Maria Gold-Silver project and the Primavera Gold-Copper Porphyry project.

 

Calibre’s 100%-owned projects host gold-silver and gold-copper NI 43-101 Resources at the Cerro Aeropuerto skarn and the Primavera gold-copper porphyry deposits.

 

Cerro Aeropuerto Skarn

 

  • Cerro Aeropuerto Inferred Mineral Resource: the NI 43-101 compliant Inferred Resource at the Cerro Aeropuerto gold-silver deposit contains 707,750 ounces of gold and 3.1 million ounces of silver in 6.05 million tonnes grading 3.64 g/t Au and 16.16 g/t Ag at a cut off of 0.6 g/t AuEq (see NI 43-101 Technical Report and Resource Estimation of the Cerro Aeropuerto and La Luna Deposits, Borosi Concessions, Nicaragua’ authored by Todd McCracken, P. Geo dated April 11, 2011 on sedar.com).
  • Recent diamond drilling at the Cerro Aeropuerto gold-silver deposit completed subsequent to the 2011 resource estimate has returned positive results including both wide mineralized zones and narrower high-grade intercepts including:  2.07 m grading 157.20 g/t Au and 117.7 g/t Ag; 8.12 m grading 22.47 g/t Au and 10.9 g/t Ag in drill hole CA16-022; and 26.03 m grading 6.39 g/t Au and 9.1 g/t Ag in drill hole CA16-020 (see Calibre news release dated March 22, 2016) and 77.78 m grading 1.09 g/t Au and 13.7 g/t Ag in drill hole CA17-045 (see Calibre news release dated January 11, 2018).
  • Additional diamond drilling completed on the Huracan porphyry gold-copper target located two to three kilometres south of the Cerro Aeropuerto deposit intersected wide zones of alteration containing porphyry-style gold-copper mineralization including 189.63 m grading 0.22 g/t Au and 537 ppm Cu in drill hole HU16-037 and 72.23 m grading 0.27 g/t Au and 881 ppm Cu in drill hole HU16-031 (see Calibre news release dated March 23, 2017).

 

The past producing open-pit and underground La Luz Mine (2.3 million ounces of historic production) is located one kilometre north of Cerro Aeropuerto.

 

The Cerro Aeropuerto deposit contains gold and base metal bearing quartz veins and replacement style skarn mineralization.  The NI 43-101 compliant Inferred Mineral Resource estimate for the Cerro Aeropuerto deposit is provided in the table below:  

 

 

Cerro Aeropuerto NI 43-101 Inferred Mineral Resource (April 11, 2011)
Tonnes Grade
(Au g/t)
Grade
(Ag g/t)
Grade
(AuEq g/t)
Contained
Au (ounces)
Contained
Ag (ounces)
Contained
AuEq (ounces)
6,052,000 3.64 16.16 3.89 707,750 3,144,500 757,000
  1. CIM definition standards were followed for the resource estimate
  2. The 2011 resource models used Inverse Distance grade estimation within a three-dimensional block model with mineralized zones defined by wireframed solids and
  3. A base cutoff grade of 0.6 g/t AuEq was used for reporting mineral resources.
  4. Gold Equivalent (AuEq) grades were calculated using $1,058/oz Au for gold and $16.75/oz Ag for silver, and metallurgical recoveries and net smelter returns are assumed to be 100%.
  5. Resource Estimates for Cerro Aeropuerto are detailed in the technical report titled ‘NI 43-101 Technical Report and Resource Estimation of the Cerro Aeropuerto and La Luna Deposits, Borosi Concessions, Nicaragua’ by Todd McCracken, dated April 11, 2011.
  6. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource. It is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.
  7. Numbers may not add exactly due to rounding.
  8. Mineral Resources that are not mineral reserves do not have demonstrated economic viability.

 

Primavera Gold-Copper Porphyry Deposit

 

  • A maiden resource estimate in December 2016 contained an Inferred Resource containing 45.0 million tonnes grading 0.84 g/t AuEq, containing 782,000 ounces of gold, 1.7 million ounces of silver and 219 million pounds of copper at a cut-off grade of 0.5 g/t AuEq (see NI 43-101 Technical Report titled ‘Primavera Project Resource Estimate ‘ authored by Todd McCracken, P.Geo. dated January 31, 2017 on sedar.com). 
  • Drilling to date has tested less than 10% of the 20 km2 Primavera project area.
  • Primavera is characterized by porphyry style gold-copper mineralization hosted within a series of diorite porphyry dikes that have intruded a sequence andesitic volcanic rocks. Mineralization occurs in both rock types and is typical of porphyry deposits.  Primavera is the first porphyry style deposit discovered in Nicaragua.
  • Numerous additional porphyry style drill targets have been identified within the 20 km2 Primavera project area, as defined by anomalous gold and copper in rock and soil samples, magnetic and radiometric geophysical anomalies, and geological mapping.

 

The NI 43-101 compliant Inferred Mineral Resource estimate for Primavera is provided in the table below:

 

 

Primavera NI 43-101 Inferred Mineral Resource (January 31, 2017)
Tonnes Grade (Au g/t) Grade (Ag g/t) Grade
(Cu %)
Grade
(AuEq g/t)
Contained Au (ounces) Contained Ag (ounces) Contained Cu (pounds) Contained AuEq (ounces)
44,974,000 0.54 1.15 0.22 0.84 782,000 1,661,000 218,670,000 1,200,000
  1. CIM definition standards were followed for the resource estimate.
  2. The 2016 resource models used Ordinary Kriging grade estimation within a three-dimensional block model with mineralized zones defined by wireframed solids (HG=high grade, LG= low grade, sap=saprolite).
  3. A base cutoff grade of 0.5 g/t AuEq was used for reporting mineral resources.
  4. Gold Equivalent (AuEq) grades have been calculated using $1300/oz Au for gold, $2.40/lb for Copper, and $20.00/oz Ag for silver and metallurgical recoveries are assumed to be equal for all metals.
  5. Resource Estimates for the Primavera project are detailed in the NI 43-101 Technical Report titled ‘Primavera Project ‘by Todd McCracken, dated January 31, 2017.
  6. The quantity and grade of reported Inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an indicated or measured resource. It is uncertain if further exploration will result in upgrading them to indicated or measure mineral resource category.
  7. Numbers may not add exactly due to rounding.
  8. Mineral Resources that are not mineral reserves do not have demonstrated economic viability.

 

Qualified Person

 

Mark Petersen, P.Geo., VP Exploration, Calibre Mining Corp. has reviewed and approved the scientific and technical information in this press release. Mr. Petersen is a “Qualified Person” as defined under NI  43-101.

 

About Calibre Mining Corp.

Calibre Mining is a Canadian-listed gold mining and exploration company with two 100%-owned operating gold mines in Nicaragua. The Company is focused on sustainable operating performance and a disciplined approach to growth.

 

Posted February 25, 2020

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