Argentina Gold explores gold systems

In just over two years, Argentina Gold (VSE) has established itself as one of the premier “grassroots” gold explorers in Latin America. Having identified dozens of alteration zones (thought to represent epithermal gold systems) on its 600,000-hectare land package, the company is now seeking partners to help develop several properties.

Since its formation, Argentina Gold (ARP) has acquired a large number of projects in a broad region stretching from Salta province in northwestern Argentina to Mendoza province in the west-central portion of the country. These projects are scattered over a distance of more than 1,500 km along the Argentine flank of the Andean Cordillera.

Some of the more prospective properties lie within the belt of Tertiary volcanic rocks known as El Indio, adjacent to the Chilean border in San Juan province. The Del Carmen, La Poposa, Las Tortolas, Rio Frio, Veladero and Olivares properties contain alteration zones similar to those that host Barrick Gold’s (TSE) El Indio, Tambo and Nevada deposits in Chile. Barrick recently announced that the deposits in El Indio contain proven, probable and possible reserves totalling 8.8 million oz. gold. “I see the potential for several El Indio-size deposits,” ARP director Lukas Lundin told The Northern Miner during a recent visit to some of the company’s more promising projects in the Indio belt, namely Rio Frio, Valedero and La Poposa. (One of the most advanced projects, La Poposa will be featured in an upcoming Northern Miner report.)

In 1994, ARP concluded several deals to acquire a 72.3% interest in the Rio Frio project for about US$9 million. The property consists of claims and prospects totalling some 45,000 hectares in a 10-km-wide strip which stretches 45 km along the Argentine-Chilean border. The central portion of the claims are 7 km east of the Indio and Tambo mines. Also, the property is only 4 km east of the Nevada project.

Although Rio Frio has seen only limited exploration, seven principal alteration zones have been located, all at elevations in excess of 4,000 metres.

The largest is the Rio Frio caldera itself, measuring some 5 by 2.5 km, within which the Chezanco zone is found. During the mid-to-late 1980s, previous operators carried out trenching, sampling, drilling and underground development at Chezanco, which is thought to lie along the same north-northeast-trending structure as the Tambo mine.

During the development program, it was not uncommon to encounter veins with grades in excess of 300 grams gold per tonne over widths of up to half a metre.

Chezanco contains a geological resource estimated at 5.7 million tonnes grading 2 grams to a depth of 100 metres.

Gold mineralization occurs in a series of somewhat irregular, anastomosing quartz-enargite veins which range from 0.3 to 2 metres in width. The mineralized zone, which has a strike length of 700 to 800 metres, sits in a small embayment within the Chilean-Argentine border and is constrained on three sides by faulting.

ARP President Patricio Jones says Chezanco is similar to the Indio deposit, and he envisions that the system could continue to a depth of 700 to 1,000 metres. Based on that premise, Jones says, deep drilling should be carried out to evaluate the deposit at depth.

Further south, at Cerro Colorado, initial exploration has shown that the prospect is underlain by intensely altered volcanic rocks and breccias which are associated with a dacitic-to-rhyolitic intrusive complex. These rock units host high-grade gold veins with defined, northwest trends and lower-grade, disseminated mineralization in breccia zones.

The remaining alteration systems at Rio Frio are being prospected and, in most of these areas, silicified zones have been found on top of porphyry systems with abundant alunite, other sulphates and disseminated sulphides. North of the Rio Frio claims, ARP has entered a joint venture with Barrick on the Veladero special licence. ARP is project operator and Barrick has an option to earn a 40% interest. The partners must spend US$7 million over five years.

Trenching is under way, and initial sampling has identified nine alteration zones with anomalous gold values (greater than 0.1 gram). The alteration systems occur along a north-northwesterly-trending structural corridor which is 18 km long and up to 3 km wide.

In most of the alteration zones, the general geological characteristics include a thick crust of sulphates underlain by intensively altered dacitic-to-rhyodacitic porphyries containing various amounts of fine-grained pyrite and arsenopyrite.

Geochemically, these areas are also anomalous in mercury, antimony and arsenic. ARP believes the presence of these pathfinder elements, in association with anomalous gold values, could be representative of the upper portions of an epithermal gold deposit similar to El Indio.

ARP and Barrick are also partnered on the Del Carmen special license, which is south of the Rio Frio holdings.

Barrick can earn a 60% interest in Del Carmen by spending US$10 million on exploration and providing ARP with a positive feasibility study. A large breccia zone with gold values has been outlined, and Barrick plans to carry out surface trenching and diamond drilling.