La Poposa gold play advanced

High atop the Argentine Andes, in one of most prolific gold belts in South America, Argentina Gold (VSE) is busy trenching and drill-testing targets on its La Poposa property.

During a recent site visit, The Northern Miner explored the project, which comprises 70,000 hectares in northwestern San Juan province. Perched high in the Andes at an elevation of 4,000 to 5,000 metres above sea level, the project is only 15 km from the Chilean border. The geology is part of the famous El Indio Tertiary volcanic belt, which, to the north, hosts some of Chile’s largest gold deposits.

Preliminary exploration by Argentina Gold (ARP) in 1993, identified several alteration zones along a northwest-trending fault zone. Most of the work focused on the Poposa prospect, a large caldera structure in the centre of the property. The caldera contains a 12-sq.-km alteration zone with more than 600 metres of vertical extent. To date, some 27 km of trenches have been excavated using three Caterpillar D-8 bulldozers, and 6,200 samples have been collected using sample intervals of 2, 3 or 5 metres.

So far, trenching has outlined nine targets containing zones which grade from 0.5 to 150 grams gold per tonne along intervals ranging from 4 to 60 metres. In addition, some high silver assays (up to 600 grams) have been returned, together with some anomalous copper grades.

Most of the trench values encountered occur in carboniferous quartzites which are intruded by a Tertiary-aged, dacitic-to-andesitic intrusive complex. The quartzites and the intrusives are both capped by Tertiary volcanics. “There appears to be both structural and lithological control on the gold mineralization,” ARP President Patricio Jones told The Northern Miner. Jones believes the veins are probably tensional features related to the shear or fault zone that lines up several of the calderas on the property. As for the economic viability of wallrock-hosted mineralization, Jones said infill trench sampling, using 1-metre intervals, will be required to evaluate its potential.

Although the trenching has outlined several mineralized zones, the abundant colluvium (rock debris) on the hill slopes has prevented the study of these zones in the vertical dimension. To alleviate this problem, a 2,500-metre, HQ-size (63.5-mm) diamond drill program has been undertaken. And at the time of our site visit, the third hole was in progress.

ARP director Lukas Lundin said the drilling is designed to gain a better understanding of the geological controls on the mineralization and, as a result, to “find some tonnes.”

Of the two holes previously drilled, the first intersected a wide zone of quartz veining, whereas the second was abandoned in colluvium. Assay results are expected shortly.

During the 1995 exploration program, which is expected to run until April, work will be carried out on several other prospects within the Poposa claims. These include the Majaditas, Quebrada Izquierda, Breccia Vacas and Porfido Escondido plays.

Option commitments are quite manageable, as the property was optioned from local Argentine entrepreneurs in return for small monthly cash payments, together with a 2% net smelter return royalty (which can be reduced to 1% through a US$1 million cash payment). In addition, a property payment of US$1 million is due after four years.

To date, about US$2 million has been spent on La Poposa, and Lundin expects ARP will continue operating the project itself.