Opawica year-end review
Opawica Explorations Inc OPW
Shares issued 8,733,933 Jan 14 close $1.03
Fri 15 Jan 99 Company Review
Mr. D.M.R. Clark reviews the company
During 1998 Opawica Explorations concluded its involvement in Ghana, West
Africa. In October 1997, Ashanti Goldfields Company terminated its option
to acquire a 60 per cent interest in the company's seven prospecting
licences collectively known as Totua and Enchi area licences.
Subsequent to Ashanti terminating its option on the company's Ghana
licences, the company decided to abandon all of its properties in Ghana.
Argentina
The company's wholly-owned subsidiary, Opawica Minerals Argentina had
reinstated substantially all of its land holdings in Argentina,
representing approximately 1,500 square kilometres of precious and base
metal exploration prospects.
Valle Del Cura
In this regard, Opawica has reacquired an option to earn up to a 100 per
cent interest in La Ortiga Norte, Los Despoblados, Los Baniots, Arroyo
Sepultura, Mondaca, Las Maquinas and the most recently acquired Cura Este
property, covering a total of approximately 185,000 hectares.
La Ortiga Norte
This area is in the Choiyoi Group felsic volcanics and Dona Ana formation.
The geologic environment is similar to Barrick's Pascua Lama project (11
million ounces of gold), about 15 kilometres west, along the same
alteration belt and approximately 15 kilometres northwest of the Argentina
Gold/Barrick Veladero discovery. 1997 surface reconnaissance identified
several silica caps that require further exploration. Opawica's La Ortiga
Norte property is contiguous to Barrick's La Ortiga provincial reserve
project.
Los Despoblados
This property is in the Choiyoi Group felsic volcanics as well as the Cerro
Tortolas andesitic formation. The property hosts two alteration zones
identified from landsat imagery and limited ground reconnaissance during
late 1996. The alteration zones cover an area of about 3,700 hectares and
one zone has a known gold occurrence on the eastern boundary of the
property. Los Despoblados is contiguous to the eastern boundary of
Argentina Gold's Rio Frio property.
Los Banitos
Los Banitos also adjoins Argentina Gold's Rio Frio project and is 5,000
metres south of Los Despoblados. It is within the same basic geologic
environment as Los Despoblados and is known to host a 500 hectare a colour
anomaly identified from 1996 landsat imagery.
Arroyo Sepultura
This property is approximately 6,000 metres south of Los Banitos and
situated within the Cerro Tortolas andesites and displays several colour
anomalies encompassing about 800 hectares. These colour anomalies were
identified by Opawica during 1996 landsat imagery analysis.
Las Maquinas and Mondaca
This area is situated throughout the Dona Ana, Banos del Toro and Cerro
Tortolas formations. landsat Imagery displays several colour anomalies
covering almost 600 hectares along the western side of Las Maquinas
property. These colour anomalies are contiguous to the Del Carmen property
of Argentina Gold and Barrick.
For 1999, Opawica plans an initial surface field program consisting of
reconnaissance, rock chip sampling, and geological assessment. Most
fieldwork will focus on the key alteration zones which are known to host
significant gold mineralization in the region.
To maintain Opawica Argentina S.A. in good standing with the entire 1,500
square kilometre land position including the reacquired Valle del Cura
properties noted above, the company will initially issue 100,000 shares and
pay $65,000 (U.S.) in cash and other costs. Opawica may earn up to a 100
per cent interest in La Ortiga Norte, Los Despoblados, Los Banitos, Arroya
Sepultura, and Las Maquinas by making further firm and optional payments of
up to $95,000 (U.S.) in cash over the next 24 months. The vendors of the
above Valle del Cura properties will retain a 1 per cent net smelter
royalty and this royalty may be purchased at any time by Opawica Argentina
S.A. for $1-million (U.S.).
Cura Este Property
In late December 1998, Opawica settled the principal terms of an agreement
to acquire a 100 per cent interest in this property by making payments and
incurring costs of up to $190,000 (U.S.) within the next three years and
paying 50,000 shares of the company by year end 2000. There are several
alteration zones known to exist on this property, including a gold
occurrence recently discovered by local geologists. The property is
situated on the eastern perimeter of the El Indio gold belt and on the
southwestern end of the Maricunga belt. This acquisition is subject to
final documentation and regulatory approval.
Northwestern Argentina
Opawica is continuing to evaluate a massive sulphide exploration program in
the Ordovician shales of northwestern Argentina. These shales are the
southern extension of the Peruvian-Bolivian belt that is well known for its
base-precious metals production and include world-class deposits such as
Aguilar in Argentina.
Opawica has staked 10 Properties covering 800 square kilometres in
northwestern Argentina.
Also, in northwestern Argentina, over 300 rock chip and stream sediment
samples were taken and analyzed from 12 further areas. Four of these areas
yielded anomalous Ag, Pb, Zn and Ba mineralization. A phase II surface
sampling program has been recommended on the four areas as well as other
areas of northwestern Argentina.
South-Central Argentina
Opawica has staked approximately 700 square kilometres in Rio Negro
Province, known as the Rio Chubut property. The property is in a closed
valley, 50 kilometres long by 20 kilometres wide. Alluvial gold from the
bottom of the valley was exploited until the 1980s from banks that yielded
up to 1 g/t Au. There was also small copper, gold and lead vein mines in
the valley that were active between 1910 and 1980.
Overall in Argentina, Opawica's specific target areas are within a 1,500
square kilometre area of favourable geology for Au, Cu, Ag, Pb and Zn
mineralization which range from Jujuy Province in the north to Tierra del
Fuego in the south.
Northern Ontario
In December 1998, Opawica acquired various interests in a group of
properties historically and collectively referred to as the Chance claims,
in Northern Ontario. These claims consist of:
A 100 per cent interest in three base-metal prospects in central and south
Kidd Township, Ontario including a 10 per cent net profits interest in one
further property, Chance-1, which is reported to host a mineral inventory
of approximately 175,000 tonnes grading 12.8 per cent Zn, 3.24 per cent Pb
and 178 grams per tonne Ag at a depth of 350 metres and said property is
contiguous to the western border of the Kidd Creek mine. Consideration to
be paid for the Kidd Group property interests is 100,000 shares of the
company and $300,000 in cash.
A 100 per cent interest in two base metal prospects in southeast Carnegie
Township, one of which is contiguous to the northern boundary of the Kidd
Creek mine property. Consideration to be paid for these two prospects is
100,000 shares and $25,000 in cash; and
A 100 per cent interest in seven leased or patented claims in Godfrey and
Wark Townships of Northern Ontario. Consideration to be paid for these two
claims is a total of 100,000 shares of the company and $25,000 in cash.
Other Projects Ontario and Quebec
Matarrow, Ontario
In June 1996, the company optioned the 38 claim Matarrow mine property in
the Matachewan gold-base metal camp of northeastern Ontario. The company
can acquire 100 per cent of the property, subject to a 2 per cent net
smelter return royalty for $50,000 cash and by expending $300,000 in
exploration over a two year period.
The Matarrow mine has historically produced approximately 40,000 tons of
6.13 per cent combined lead-zinc head grade. The main iron formation
associated with the mine is almost two kilometres in length. There are also
known gold occurrences associated with the iron formation and subparallel
sediments. Royal Oak Mines has identified a resource of approximately one
million ounces gold on a large claim block contiguous to the northern
boundary of the Matarrow mine property.
Maisonville, Ontario
During 1998, the company completed a five hole, 1,096 metre diamond drill
program on a volcanogenic massive sulphide target on the company's 100 per
cent owned Maisonville Township property 20 kilometres northwest of
Kirkland Lake, Ontario. In summary, no economic base metal intersections
were obtained. The drilling did identify prospective distal style VMS
alteration and anomalous Zn-Pb-Ag values hosted by graphitic argillite and
intermediate-felsic volcanic rocks.
Previous diamond drilling by Kerr Addison Mines on a short section of the
zone encountered encouraging, subeconomic zinc values.
The company has retained three patented claims of the original Maisonville
claim block.
Lac Shortt, Quebec
The company holds a net smelter royalty on any future gold production from
the Lac Shortt mine. The Lac Shortt mine is 100 per cent owned by Inmet
Mining and is presently not producing. The net smelter royalty is based on
a sliding scale which provides a net smelter return of 1 per cent to 2 per
cent on production sold. To date there have been no net smelter proceeds
from production.
STATEMENT OF OPERATIONS
Year ended Aug. 31
1998 1997
Revenue
Interest & divi-
dend income $ 58,304 $151,473
Admin expenses
General admin 161,152 223,489
Engineering and
property investi-
gation costs 170,875 103,592
Business promotion 172,913 206,637
Legal fees 21,730 25,601
Shareholder services 152,531 172,541
Depreciation 9,944 5,300
--------- ---------
689,145 737,160
(Loss) before the
undernoted items (630,841) (585,687)
Writeoff of mining
interests (1,426,914) (485,887)
Loss on disposal
or writedown of
marketable
securities 139,223 12,372
Loss on foreign
exchange 110,033 -
--------- ---------
Loss $2,307,011 $1,083,946
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Loss per share 35 cents 18 cents
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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