LATIN AMERICA SPECIAL — Britannia to drill Peruvian copper

Now that a border dispute between Ecuador and Peru is settled, drilling is expected to begin on the Peruvian Las Lomas porphyry copper-gold property.

The US$300,000, first-phase program will be operated by a 50%-owned subsidiary of Britannia Gold (VSE), which holds the property. Seven holes, totalling about 1,500 metres, will be drilled in an effort to test an elliptical, geophysical anomaly measuring 2 km in diameter.

A unit of Noranda (TSE) has 30 days, from completion of the program and delivery of results, to elect to proceed with a second stage of work, budgeted at US$700,000.

Britannia’s Peruvian subsidiary had planned to drill the prospect earlier this year but was delayed by the border dispute. While the property is not near the disputed region, it was not possible to begin work as fuel consumption was rationed in the area.

Britannia also reported that Goldcorp (TSE) is taking part in a private placement which will increase its direct and indirect shareholding in Britannia to 3.4 million shares, representing about 27% of the company. Goldcorp also has the right to joint-venture a number of Britannia’s properties in Peru for a period of two years from approval of the transaction by regulatory authorities.

Britannia’s 50%-held Peruvian subsidiary, Minera Britannia, has other interests in Peru. The company recently staked 3,700 hectares known as the Alce claims in southern Peru.

These claims lie adjacent to the Nazca-Ocona gold belt where several producing gold mines are situated. The claims also lie within a newly identified, northwest trending Precambrian belt in which gold-quartz stockwork and vein systems “of considerable size” have been examined. Britannia notes that these claims can be reached by automobile in about 2.5 hours from Arequipa. The claims are adjacent to a small, producing mine, where a system of gold-bearing quartz veins and veinlets are found within a phyllite horizon. This horizon forms a structure 25-50 metres wide with a possible length along strike of more than 2 km.

Minera Britannia’s exploration crews visited the mine site and took samples. The results — 6.83 grams gold per tonne over a 10-metre width and 44.8 grams across 1.9 metres — prompted the company to attempt to acquire the area being mined.

Whatever the outcome, the mine’s gold-bearing systems are believed to continue onto claims staked by Minera Britannia, and an “aggressive” exploration program is scheduled to begin shortly.

Minera Britannia also holds the rights to 4,000 hectares contiguous to the Yanacocha mine near Cajamarca in northern Peru. A preliminary exploration program is scheduled to begin in early April on the Las Sorpresas claims. The company is also reviewing several advanced-stage projects in Peru.