Iron Creek becoming active in Chile

Vancouver – While Iron Creek Capital (IRN-V) may be rusty after an extended period of little activity, a new president and new capital should kick-start progress for the Chilean explorer.

Timothy Beale, with over 20 years of experience working in Chile, Argentina and Peru for several majors, was brought on as president in July. He said in a meeting with the Miner that while the company had been ‘moribund’ for a while, the potential of its properties remains strong.

“We’re right in elephant country for big porphyry deposits,” said Beale.

The 45,000-ha Victoria project is Iron Creek’s most active, where joint venture partner Hochschild Mining (HOC-L) has been drilling to earn a 60% stake in the property. The project spans 37 km along the Domeyko fault zone, the same zone that hosts some of the world’s largest porphyry deposits.

Hochschild needs to spend US$6 million by 2013 to earn into Victoria, but Beale expects that to be spent by the end of the year. Hochschild has already drilled around 17,000 metres of reverse circulation drilling and over 700 metres of diamond drilling on the project and is currently working through a 5,000-metre diamond and 6,000-metre RC drill program.

While Beale sees big copper porphyry potential on the property, Hochschild has been concentrating exploration on precious metals around a historic open pit on the property called Vaquillas. The mine was active in the 1980s, but the company has not been able to find any records for the operation.

Results from Vaquillas so far include diamond drill holes 10-033 that hit 10.5 metres grading 8.9 grams gold per tonne and 116.31 grams silver per tonne from 135 metres depth and 10-032 that cut 49 metres averaging 1.14 grams gold and 32.63 grams silver from 101 metres; and RC hole 09-002 that returned 21 metres grading 1.1 grams gold and 128.5 grams silver.

There is some evidence from twinning holes with diamond drills that the RC holes have not been representative of gold grades, with further testing planned to confirm that. With Hochschild’s current program closer to half and half diamond and RC, a clearer picture should emerge.

Hochschild’s current program should also test some of the porphyry targets on the site, something Beale has been pushing.

Beale is particularly intrigued by the undrilled Incahuasi target on the south end of the property, with hydrothermal alteration over 3.5km by 1.5km.

“It’s something I find incredible in this part of the world. So much of the area has been drilled to death,” said Beale of the undrilled target.

With Hochschild quickly earning in its stake, Iron Creek will soon be on the hook for 40% of exploration expenditures and so has initiated a $6.3 million financing. The company is issuing 7.3 million brokered units at 65¢ and a further 2.4 million non-brokered units at the same price. Originally the financing was set a $4.5 million but strong demand had the company increase it.

“The people we’ve met have seen a lot of potential,” said Beale of the interest. He also noted that the financing will also add some liquidity to the stock, since prior to the financing the company only had 17 million shares outstanding.

Along with the Victoria project, the company is in a 50-50 joint venture with Andina Minerals (ADM-V) on the 27,000-ha Pampa Buenos Aires project, has 100% interest in the 11,300-ha Pampa Sur project just south of it, and has a small holding of 52 ha called the Magallanes project where Iron Creek hopes to extend its holdings.

Since the company started become more active, and with the marketing help from being a member of Vancouver’s Gold Group of companies, Iron Creek’s share price has climbed to over 70¢ after sitting largely untraded at around 30¢for some time.