Vancouver A preliminary agreement with a copper unit of Xstrata (XTA-L) gives Minera Andes (MAI-T) rights to own and explore the newly expanded Los Azules porphyry copper project in Argentina’s San Juan Province.
The companies had been exploring separate adjoining properties that have now been consolidated into one land package covering 7,500 hectares near the border with Chile. The properties straddle a large copper porphyry system that will now be explored solely by Minera Andes, which can earn 100% of Xstrata’s property by spending at least US$1 million on exploration over four years.
Xstrata retains a one-time back-in right to earn a 51% interest if a preliminary assessment shows the project to be economically viable and capable of producing 100,000 tonnes of copper per year for at least ten years. The company can earn the majority interest by cash payments valued at three times exploration expenditures, completing a feasibility study, and assuming underlying property commitments. If the project doesn’t meet this economic threshold, Xstrata would have a right of first refusal on any subsequent sale of the property.
The combined property covers a large enriched (chalcocite) copper zone that has been tested by 15 reverse-circulation and nine core holes totaling 5,481 metres. Eight of the holes hit copper mineralization greater than 0.4% in an area defined by geology and geophysical surveys. The best hole returned 0.55% copper over 143 metres and ended in mineralization.
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