SOUTHEAST ASIA SPECIAL — Chase projects attract major interest

Long before it was fashionable to explore for minerals in Southeast Asia, Chase Resource (TSE) had amassed an impressive portfolio of properties in the Philippines. In recent years, these projects have attracted the interest of major companies looking to gain a foothold in the country.

Late last year, American-based Magma Copper paid US$1 million to acquire an option to earn 51% of Chase’s Taysan copper-gold project. Magma also bought 2.5 million Chase shares at $2.50 each and secured rights to buy more shares in order to maintain a 15.8% equity position.

To earn the interest in Taysan, Magma agreed to pay an additional US$2 million by March 31, 1997, and spend US$5 million on a feasibility study.

(Magma has since been acquired by BHP Minerals.)

Chase will retain a 49% interest and a 3% net smelter return royalty.

At last report, Taysan hosted 600 million tonnes grading 0.31% copper and 0.3 gram gold per tonne. A third drill program started early this year and is aimed at advancing the project to the feasibility study stage.

In March, BHP Minerals and Chase concluded an option agreement to acquire more than 110,000 hectares of claims in the provinces of Aurora and Nueva Ecija.

The land package lies in the Sierra Madre Mountains, about 150 km northeast of Manila on Luzon Island. The Aurora project is a joint venture, with BHP holding a 70% stake and Chase, 30%.

Although the region has not been explored with modern technology, Chase notes that several significant prospects have been identified on the southern end of the property. Two large zones of copper-gold porphyry-style alteration were outlined, and prospecting showed potential for bulk-tonnage, disseminated copper and gold deposits.

BHP will operate the work programs. The minimum work commitments during the 6-year option period total US$5.8 million.

In February, Chase signed an agreement with a Philippine company to gain an interest in more than 1,100 hectares of claims and mineral leases in the province of Sultan Kudarat, on south-central Mindanao Island. Chase can earn a 75% interest in the Allah property, where gold and copper targets will be explored.

The company has other holdings in the Philippines, including the T’Boli gold project on Mindanao Island. This project is considered to be prospective for both large gold porphyry deposits and high-grade epithermal gold systems.