Abo Res. active on Argentine copper-gold play

Exploration work is under way on the Uspallata copper-gold project in west-central Argentina.

Abo Resources (VSE) has a 40% interest in the property, while Bema Gold (TSE) has a 10% interest and Argentina Mineral Development holds the balance. Abo acquired its interest from Bema in return for common shares and has an option to buy Bema’s remaining interest under similar terms. Bema’s work commitment (which is now Abo’s) includes US$3 million in property expenditures over three years plus property payments of US$350,000 for a 50% interest.

The current program entails road-building, aeromagnetics, ground geophysics and geochemistry. The joint venture expects to begin drilling priority targets in late March and estimates it will have spent US$2.3 million by mid-June.

One of the targets is described as a copper-gold porphyry system with intense stockwork development over an area measuring 1 km long by 1 km wide. Rock chip sampling returned grades of 2.16% copper plus 0.2 grams gold per tonne over 40 metres, 0.85% copper plus 0.4 grams gold over 62 metres, and 0.74% copper plus 0.3 grams gold over 30 metres.

In addition to the Abo shares it acquired under the property agreement, Bema is buying 6 million special warrants from the company at 60 cents each. The special warrants convert to a share and a purchase warrant exercisable at 75 cents in the first year and 85 cents in the second.

Following the special warrant placement, Bema will own more than half of Abo’s common shares.