FDG Mining (FDG-V) is working to prove up resources at the past-producing Topacio gold concession in central eastern Nicaragua, with an ongoing two-phase drill program.
The junior formed in 2006 as a private Vancouver-based company exploring in Nicaragua, before becoming enamored with the 93-sq.-km Topacio property, located in Topacio, one of the five main gold mining districts in the country.
The concession lies 3 km southeast of the nearest town, Cara de Mono, on Highway 7, and covers the entire known district, which has seen little modern exploration.
The main showings on the property include 11 northeast trending, steeply dipping epithermal quartz vein, of which six have been previously mined. The showings were uncovered in the 1890s and mostly mined in the early 1900s. It is estimated that 160,000 tonnes grading 8 grams gold and 80 grams silver per tonne were recovered from underground workings on the Mico, Salmeron and Lone Star veins.
Fast-forward to the end of that century. Two main modern drill programs were carried at Topacio, one in 1984 by Brazilian company, Companhia de Pesquisa de Recursos Minerais (CPRM), and the other in 1995-96 by Vancouver-based Triton Mining.
Following Triton’s program in the mid-90s, efforts to advance the project were abandoned thanks to a poor gold market. Since then no work has been done on the property. That is until FDG walked onto the scene in 2009.
Eager to start work, FDG, still a private company, signed a definitive three-year option with Iversiones Mineras (IMISA) to buy Tapacio by paying US$3 million at any time before April 30, 2013. The junior also agreed to make additional semi-annual payments of US$60,000 to the Nicaraguan company, until the option is exercised. IMISA has a 3% net smelter return royalty on Tapacio’s production.
FDG went public in May 2011, offering 3.7 million shares at 25¢ apiece for gross proceeds of $948,500.
The previous operators, CPRM and Triton, estimated the project has a non-compliant, global resource of between 260,000 oz. gold to as much as 1.3 million oz. gold grading an average of 5 to 6 grams gold, with associated silver.
Looking to confirm a compliant resource, FDG commissioned a National Instrument 43-101 technical report that was completed last February. Using a 3 gram gold cutoff, the report outlined an inferred resource on the Topacio vein of 680,000 tonnes averaging 5.2 grams gold and 34 grams silver for 114,000 oz. gold and 743,000 oz. silver. The resource was based on 26 holes drilled into the vein by Triton.
Early last December the junior started a first phase diamond drill program to twin Triton’s 1996 holes and to test the extent of the resource. That phase contains 20 holes, of which 16 have been completed so far.
On March 14, FDG released its latest five assays, of which four were drilled below the current inferred resource. Those holes extended mineralization by another 60 metres.
Currently, the resource is open along strike to the northeast and southwest. At its deepest, the inferred resource extends 200 metres at depth, and is still open.
The second phase of the program will test high-grade gold mineralization that the company identified through trenching that cut the Brasil and Mico veins.
FDG says Topacio has a similar geological setting to B2Gold’s (BTO-T) La Libertad and El Limon mines to the northwest.
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