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Cordoba Minerals to acquire two Colombia Cu-Au projects
Aug 1st 2013 - News Release
Cordoba Minerals Corp. has entered into a binding agreement to acquire a 100-per-cent interest in the Cordoba copper-gold project from the Minatura group of companies and the adjacent San Matias property from Sabre Metals Inc., located in the municipality of Puerto Libertador, department of Cordoba, 200 kilometres north of Medellin, Colombia.
This agreement consolidates a major land package covering multiple porphyry copper-gold targets along an inferred northern extension of the prolific Middle Cauca gold belt of central Colombia, in which several major gold discoveries have been made in recent years. Several intrusive centres have been identified on the two properties and neither property has been drilled, despite a long history of both alluvial and hard rock mining.
Simon Ridgway, chief executive officer of the company, commented: "I'd like to thank the management of Minatura and Sabre for their efforts in facilitating this logical step forward in the development of what I believe is a new porphyry district. This deal brings together strong management teams and two exceptional land packages in a truly world-class mineral belt. We can now look forward to drilling the known copper-gold targets, beginning hopefully in August."
The properties
The Cordoba and San Matias properties consist of various mining concessions and concession applications covering approximately 24,790 hectares and 1,465 hectares, respectively, underlain by volcano-sedimentary rocks that are intruded by multiple dioritic intrusives with the excellent potential to host porphyry copper-gold deposits.
Exploration conducted by the company and Sabre to date has included airborne magnetic and radiometric surveys, a ground-based magnetic survey, regional prospecting, stream sediment and soil sampling, local geological mapping, trenching, and rock sampling. This work has identified several promising drill targets, including the Montiel and Costa Azul areas on the Cordoba property, and the artisanal open-pit mine on the San Matias property.
Copper-gold mineralization occurs in both intrusive and volcanic rocks at these locations, associated with sheeted quartz-magnetite veining and alteration styles indicative of a highly prospective porphyry copper-gold environment. The Montiel prospect is located just 700 metres west of the San Matias open-pit operation, and magnetic surveys suggest that the two intrusive bodies may be connected at depth. These targets are just three of at least six recently defined soil geochemistry and/or magnetic survey anomalies on the combined properties, which have yet to be fully explored.
Significant trench results obtained by the company to date include 30 m of 0.7 gram per tonne gold and 0.8 per cent copper at Montiel, and 30 m of 0.47 g/t gold and 0.47 per cent copper at Costa Azul, from saprolitic rocks near surface. Sabre's channel sampling at San Matias returned 154 m of 2.6 g/t gold and 1.6 per cent copper from a continuous but circular path (in and around the artisanal workings) in deeper bedrock exposures that are currently being mined from an open pit. The San Matias mine workings currently cover an area of 90 m by 50 m and the high-grade porphyry mineralization remains open in all directions.
A preliminary diamond drilling program has been designed by Sabre to test the San Matias target and is expected to start later this month. Additional drilling of the Montiel and Costa Azul targets will follow accompanied by an aggressive surface sampling campaign to locate further targets within the extensive consolidated land package.
The proposed transaction
The company currently owns an 11-per-cent interest in Cordoba Holdings Corp. (CHC), a private company which holds indirect title to the Cordoba project. Pursuant to the agreement, the company will acquire from Minatura International LLC, Minatura Gold and certain minority shareholders of CHC (collectively Minatura) the remaining 89 per cent in CHC, and will also acquire all of the outstanding shares of Sabre Metals, a private company which has the right to acquire a 100-per-cent interest in the San Matias property.
In consideration therefor, the company has agreed to:
- Issue common shares in its capital stock to Minatura and Sabre's shareholders, so that the company's resulting issued capital will be 81,942,881 shares, of which Minatura will own 29,499,437 shares, or 36 per cent of the company, and the Sabre shareholders will own 26,221,722 shares, or 32 per cent of the company;
- Issue 2,117,647 warrants to Minatura and 1,882,353 warrants to the Sabre shareholders, each warrant exercisable at 30 cents for two years from closing of the transaction;
- Make cash payments to Minatura totalling $5.0-million (U.S.) ($1.0-million paid on signing of the agreement, and $4.0-million due on closing of the transaction).
In addition, the company intends to raise at least $3.0-million by way of an equity financing, the proceeds of which will be held in escrow to be released concurrently with the transaction closing.
Upon completion of the transaction, the company will have seven directors, two of whom to be nominated by Minatura, two by Sabre, two by the company and the seventh by mutual agreement of the parties. Mario Stifano will be appointed president and chief executive officer of the company. As well, the option agreement signed in March, 2012, whereby the company had been granted the option from Minatura to increase its ownership of the Cordoba project from 11 per cent to 100 per cent will no longer be in effect.
Each of Minatura and Sabre is at arm's length to the company, and none of the directors or officers of the company are directors, officers or shareholders of Minatura or Sabre, other than Tod Turley, who is chief operating officer of Minatura and a director of the company.
Completion of the transaction is subject to a number of conditions, including approval by the shareholders of the company and Sabre, completion of the financing, preparation of a National Instrument 43-101-compliant technical report on the San Matias property, and approval by the TSX Venture Exchange.
Quality assurance/quality control
Geochemical analyses for both the company and Sabre were performed independently by Acme Labs of Vancouver, B.C. Samples collected by each company were delivered separately to Acme's Medellin, Colombia, preperation facility for initial crushing and splitting, and the geochemical analyses were conducted in Acme's Vancouver laboratory. For the company, gold analyses were conducted by fire assay with an ICP-ES finish, and copper was analyzed by aqua regia digestion with an ICP-MS finish. For Sabre, gold analyses were conducted by fire assay with an ICP-ES finish, and copper was analyzed by four-acid digest with ICP-MS finish. Both Sabre and the company have a rigorous QA/QC program in place with blanks, duplicates and certified reference standards inserted into the sample stream to monitor laboratory performance.
Qualified person
The company's president, Peter Thiersch, MSc, PGeo (APEGBC), is the company's qualified person in accordance with NI 43-101, and has reviewed and approved the technical content of this release. Mr. Thiersch has reviewed and approved the technical information provided to the company by Sabre, but the company has not independently verified Sabre's exploration results.
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