Property Description, Accessibility, Infrastructure, Climate and Physiography
The San Antonio Mineral Property is located east of the city of Hermosillo, Sonora State, Mexico, within the Soyopa and San Javier municipalities. Road access to the site is by a two lane paved highway from Hermosillo for 164 kilometres, and then immediately west of the Yaqui River, turning off north on an improved dirt road for approximately 8 kilometres to reach the Luz del Cobre copper plant, field camp, offices and workshop.
The camp and office site is located just west of the Yaqui River and 1 kilometre south of the village of San Antonio de la Huerta in gently rolling hills within the river basin which runs from North to South in the Western portion of the Sierra Madre. To the west and into the main part of the San Antonio Project, the topography rapidly becomes mountainous. Site elevations range from 150 metres at the camp to over 1,300 metres above sea level on the high peaks, with the slopes covered with seasonal heavy bush vegetation. Winters are mild, but summers are very hot with daily temperatures nearly always in excess of 40 degrees Celsius. Although semi-arid, heavy thunderstorms occur in the summer mainly from July into September and a more persistent light rain may fall during the winter months.
Currently the population of San Antonio is less than 300 people but this is increasing to as jobs become locally available and local people return. Other villages of a similar size within a 20 km radius include Tonichi, Soyopa, San Javier and Onavas. A 13.2 KV power transmission line crosses the property from the Novillo hydroelectric facility 50 km to the north. The current line provides power for the camp, office and laboratory facilities. Generators have been purchased to produce the power needed for the production of copper from Luz del Cobre.
The Company constructed and owns the license to a fully permitted water well (350,000 cubic metres/year) about 800 metres northeast of the camp between the village and the Yaqui River which provides water to the camp and for the projected processing plan.
The industrial centre and state capital city of Hermosillo provides the full range of services and supplies typically needed for a mining project. Experienced competent mining professional are available in Mexico and general labor can be recruited from the surrounding small towns. This local history of mining aids in locating help with some degree of experience.
The Property is situated between 28 degrees 30 minutes and 28 degrees 45 minutes north latitude and between 109 degrees 35 minutes and 109 degrees 50 minutes west longitude. More specifically San Antonio is bounded by UTM coordinates of 3,157,000 and 3,170,000 metres in Northing and between 619,800 and 636,500 metres in Easting.
The Property comprises of 42 mostly contiguous Mining Claims (Lotes or Fundos Mineros) totaling 11,240 hectares. New Mexican mining regulation (January 1, 2006), no longer makes a distinction between "Exploration" and "Exploitation" claims; all are combined under the term "Mining Claims" which may be held for 25 years and can then be renewed for an additional 25 years. The claims remain valid as long as the annual taxes are paid. Taxes have been paid up to date and all holdings are currently in good standing.
The surface rights of the holdings are owned by two ejidos (San Antonio de la Huerta and San Javier), which are essentially government sanctioned cooperatives consisting of groups of local citizens who collectively utilize and manage the land. For work requiring surface disturbances, a Surface Occupation Lease is required with the ejido. The San Javier ejido owns land under portions of the holdings on the west, and the San Antonio ejido controls the land on the east side of the claim block. A Surface Occupation Lease is in effect with the San Antonio ejido on a portion of their land where exploration work has been done and is planned for the future. Additionally a renewable six year lease was signed in late 2006 for the use of all surface rights required for the Luz del Cobre copper project, the open pit mine, waste dump, leach pad area, copper solvent extraction and electrowinning plant and the related infrastructural facilities. Additional leases will be executed as exploration work proceeds into other areas.
Mineralesl Libertad: San Antonio Mineral Properties
The core area of the San Antonio Project was owned and maintained for several decades by Minera Sanex, a Mexican company that had been intermittently active in the area. Golden News Resources (today in continuation: Red Tiger Mining Inc.), purchased the ownership of Minerales Libertad S.A. de C.V ("ML") from Minera Sanex in 1993.
As part of the original purchase agreement, certain claims are subject to a 2% Net Smelter Royalty on copper and gold. The royalty is applied separately to each metal, with a maximum royalty of $3 million to be paid on each.
Systematic exploration work, including mapping and geochemical surveys were done over the core area of the San Antonio Property in the 1990ies, outlining gold and copper mineralizations. In this period of time a predecessor company of Red Tiger Mining mapped and sampled a large part of the central part of the property, completed geophysical surveys as well as drilled 226 Reverse Circulation ("RC") holes totalling 32,000 metres, mainly on the Golfo de Oro-California and Cerro Sapuchi gold targets. Additionally, 57 NQ core holes totalling 15,000 metres were drilled, mainly at Golfo de Oro and at El Tigre. Between 2003 and 2005 Zaruma, the predecessor company of Red Tiger Mining, drilled 59 drill holes totalling 8,268 metres on gold targets and then added another 69 drill holes totalling 7,279 metres on copper targets from 2006 to 2008.
Historically, there have been a number of small scale mining operations including extracting copper by a cementation process from high grade material of Luz del Cobre and a small gold milling operations was active in the 1960ies.
Despite historic exploration expenditures of about US$ 15 million, it is estimated that just 30% of the prospective area of the property has been investigated. The work completed has focused on relatively shallow resources, while the potential at depth remains untested.
Geology and Mineralization
The San Antonio Properties are loacted within a cluster of copper, molybdenum and gold occurrences (Suaqui Verde, Los Verdes, Cuatro Hermanos) located in a West to East striking 50 km by 20 km zone, part of the northwestern Mexico-Arizona porphyry belt which includes the world-class copper deposits Cananea and Claridad. Historically the mineralization at San Antonio has been considered to be porphyry related, but the characteristics of the district strongly suggest that the mineralization may belong to an emerging new class of mineral deposits characterized as iron-oxide-copper-gold-(uranium) ("IOCG") systems
The property holdings are underlain by a structurally complex section of Paleozoic and Mesozoic sedimentary rocks that have been intruded by igneous bodies of at least two compositions. Away from the central portion of the San Antonio Project this succession has been overlain on the south, west and east by Cretaceous and younger volcanic and lesser sedimentary rocks.
The oldest rocks at San Antonio belong to the Ordovician San Antonio Formation that consists of a marine succession dominated by silicious clastic sediments. The lowest member of the formation is a quartzite that is overlain by a skarnified (heat-altered) calcareous siltstone that grades upward into siltstones with occasional shale beds. Unconformably overlying the San Antonio formation is the Triassic Barranca Group, a continentally derived sedimentary section. Overlying the Arrayanes Formation are the Cretaceous Santa Clara Formation and the Coyotes Formation. On the southern margin of the property, Cretacious to Tertiary andsites of the Tarahumara Volcanic Series are exposed. On the eastern half of the San Antonio Property the sedimentary rocks form a gentle antiform which plunges shallowly to the east, a likely result of the intrusive activity, and suggests the possible presence of a larger plutonic body at depth.
Intruding the entire sequence described above are numerous bodies belonging most likely to two events of similar magmatic compositions. Based on field relationships, the earliest of the intrusives are tonalites, which occur in greater frequency and in larger bodies, including stocks, dikes and sills. These tonalites (termed dacite if fine grained) have been dated at 57.4 Ma. Slightly younger and occasionally cross-cutting the tonalites is diorite (termed andesite if fine grained) which most often occurs as dikes.
San Antonio Generalized Geological Map
Breccia bodies occur throughout the San Antonio Property and in all rock types and provide an important host for mineralization. The breccias are complex, with variable clast size, form and lithology and contain similar complex and variable matrix volume and mineralogy. Field relationships demonstrate the temporal and spatial correlation of the breccia formation with the intrusive activity. Specific methods of brecciation are thought to be, in order of increasing abundance of the breccias, structural, intrusive (hydrothermal) and collapse.
The structural setting on the Property is equally complex. Mapping has established a tentative framework for the major sequence of faulting. The oldest faults appear to be roughly east-west to northeast high angle faults. These are crossed by northerly trending faults (with a north-northwest set thought to be economically very important), also of high angle. Two sets of low angle faults are younger, and likely related to the episodic intrusive activity.
Mineralization found on the San Antonio Project to date has contained either copper or gold alone, but potential exists for deposits containing both metals, either in a zoned deposit or by overprinting of separate (but related) mineralizing events.
Wide-spread copper mineralization has been recorded to occur in various locations over the entire property:
- Blanket-type oxidized, surficial copper mineralization (Luz del Cobre-type)
- Primary sulphidic copper mineralization in breccias and stockworks (Carrizo-type)
- Primary sulphidic copper impregnations in volcanics and intrusive dykes
- Stockwork and veinlet-fillings in sediments.
Two primary types of gold deposits have been exploited on a small scale on the San Antonio Project in the past (exclusive of placer deposits). These are the structurally controlled or vein mineralization and breccia hosted mineralization. Often, these two types may blend into one another. The primary focus of exploration, due to the potential for larger sized deposits, is breccia-hosted mineralization. In the long term, additional target types may also emerge, such as skarn (as evidenced by the skarnification of the lower part of the San Antonio Formation) or other tabular bodies and more typical porphyry style occurrences. Additionally a blanket-type oxidized gold mineralization has been found on top of a primary gold structure at a location called Sapuchi Ridge.
The various types of copper and gold mineralization and targets appear to be generally aligned along a southwest to northeast structural trend which is cross-cut by a major southeast to northwest structural pattern.