Panoro finds partner for Antilla in Peru

VANCOUVER — In the three years since it acquired the Antilla project 140 km southwest of Cuzco, Peru, Panoro Minerals (PML-V) has defined a sizable copper-molybdenum resource at the site. Now the junior has brought the project a significant step closer to production with the signing of a joint-venture deal with a private Peruvian company aimed at developing a mine.

Chancadora Centauro, a Peruvian company that already owns and operates a gold-silver mine, will pay Panoro US$8 million and invest US$17 million in Antilla over 30 months to earn a 70% interest in the project. The investment is intended to fund a feasibility study through to completion.

Panoro has already defined an inferred resource at Antilla of 154 million tonnes grading 0.47% copper and 0.009% molybdenum, including a higher-grade zone comprising 70 million tonnes averaging 0.56% copper and 0.011% moly. The resource is entirely contained within the East Block, where copper and moly are hosted in a tabular blanket of supergene sulphide mineralization dominated by chalcocite and molybdenite associated with quartz stockworks, veinlets and disseminations.

The next step is to complete in-fill drilling to upgrade the resource, step-out drilling to expand it, and exploration drilling to test nearby targets. The key step-out targets are to the north and northeast of the deposit; independent targets include the West Block area, which is 2.5 km away and shows similar characteristics to the East Block on surface but has never been drilled. The new partners expect to start drilling when the rainy season ends, which should be sometime in April.

Panoro acquired Antilla in mid- 2007 when it took over Cordillera del las Minas, a Peruvian corporation, from subsidiaries of Vale (VALE-N) and Antofagasta (ANTO-L). The takeover cost Panoro US$13 million and 6 million shares but it gave the company 100% ownership of 13 properties, all located in Peru’s Andahuaylas-Yauri belt, which is home to several porphyry copper and copper-gold deposits.

Antilla was the most advanced of the 13 projects. The 74-sq.-km property is 25 km southeast of Grupo Mexico’s (GMBXF-O) Las Chancas project, which boasts a resource of 200 million tonnes grading 1% copper.

Panoro has identified a conceptual starter pit at Antilla that contains 15 million tonnes grading 0.72% copper and 0.017% moly and carries a strip ratio of 0.9 to 1. The deposit defined to date would support a 20,000-tonne-per-day operation for 21 years.

Panoro’s new partner, Centauro, operates the Quicay gold mine in the Cerro de Pasco region of Peru. The private company started building the open-pit mine in 2000 and poured its first gold in 2002, producing 48,000 oz. gold and 13,000 oz. silver annually since.

Antilla is not the only project Panoro wants to develop. Now that it has found a partner for its most advanced project, the company plans to focus on some of the other potential gems in its Peruvian portfolio.

One of those is the Cotabambas project, home to 114 million inferred tonnes grading 0.68% copper and 0.38 gram gold per tonne contained in a cluster of porphyry systems. The project is 40 km north of Xstrata’s (XSRAF-O, XTA-L) Las Bambas project, which is home to 860 million tonnes grading 0.93% copper.

Panoro is also planning a drill program at its 100%-owned Kusiorcco porphyry copper project, which is adjacent to Norsemont Mining’s (NOM-T) Constancia project. Constancia is home to 256 million indicated tonnes grading 0.5% copper and 156 million inferred tonnes averaging 0.33% copper. Panoro received an exploration permit for the site in December.

Kusiorcco has never been drilled. The target is a 1-km long, 2-km wide induced polarization and resistivity anomaly that overlies a 300-metre by 500-metre alteration zone characterized by intensive quartz vein stockworking.

And Panoro recently found a partner to advance its Alicia project, another copper-gold target in southern Peru acquired in the Cordillera de las Minas takeover. In September, Jim Borland’s Strait Gold (SRD-V) signed on to earn up to 100% of the project, subject to a 2% net smelter return royalty. To earn its first 55%, Strait Gold must: issue 600,000 shares to Panoro; spend US$650,000 on exploration; and obtain an agreement with the local community.

Panoro’s share price gained 4¢ on news of the Antilla deal to reach 30¢. The company has a 52-week trading range of 14¢-38¢ and 85 million shares outstanding.