"Trading commenced on January 31, 2018, which the market has received very well. This reflects the fact that the copper market is really strong right now and that there is a shortage of high-grade copper projects in favorable jurisdictions. Soledad is high-grade and Peru is a great place to be."
How did you decide to form Chakana and how has the market received your recent listing on the TSX?
After leaving MMG in 2016, I was introduced to Tom Wharton and Juan Valdivia. We all had the common interest in forming a discovery-focused company in Peru. As an exploration geologist with experience at Las Bambas and throughout the Americas, my technical skills complemented the financial capabilities of Tom Wharton and operational expertise of Juan Valdivia. Because of my previous experience in the region, I had shortlisted the Soledad project; therefore, we signed a 100% purchase option agreement with Condor Resources in April 2017, and started drilling in August 2017. Upon completion of the reverse takeover with Remo Resources, trading commenced on January 31, 2018, which the market has received very well. This reflects the fact that the copper market is really strong right now and that there is a shortage of high-grade copper projects in favorable jurisdictions. Soledad is high-grade and Peru is a great place to be.
What was the previous history of Soledad before Chakana's arrival?
Previously, Condor carried out some basic exploration mapping and sampling. Mariana Resources continued extensive work in geophysics, mapping, sampling and drilled 12 drill holes with very interesting results. After Mariana, Casapalca optioned the project and drilled four additional holes. The strategy of all these companies was to find a porphyry deposit that is assumed to be related to the tourmaline breccia pipes. Our view is different. We think these high-grade breccia pipes can offer significant economic value because they are numerous, high-grade, vertically extensive from surface, and are relatively easy to explore.
What have been the highlights of your drilling activity so far?
Highlights from our first few holes in Breccia Pipe #1 include 146.6 meters with 2.51 g/mt Au, 48.6 g/mt Ag and 0.77% Cu, and 209 meters with 2.22 g/mt Au, 69.6 g/mt Ag and 0.96% Cu, both from surface. Additional holes have similar grades but the lengths vary as we are drilling various azimuths and dip angles to define the geometry of the pipe. We are in the beginning of a very aggressive program and it will take us approximately two years to go through all the pipes. So far we have identified nine mineralized breccia pipes on the property that crop out at surface. We certainly believe that the potential exists for enough tonnage with attractive copper-gold-silver grades to develop a mining operation.
Geologically speaking, what other projects in Peru or the region compare to Soledad?
A similar type of deposit is the Turmalina mine in Peru. It is a tourmaline breccia pipe that had very high-grade copper in one margin that has been mined out. The best examples of this deposit type are in Chile, in the Río Blanco-Los Bronces district. Los Sulfatos, a discovery by Anglo American, is enormous in scale with 1.2 billion mt at 1.46% Cu. There are also the Sur-Sur and Donoso breccia bodies with the same exact style of mineralization we see in Soledad.
Where is the project located and what is the situation for mining in the area?
The project is located in Ancash, 35 km south of Barrick's Pierina mine. The nearest large city is Huaraz and the nearest towns are Aija and Recuay. It is a 7 hour drive from Lima to the project and there are commercial flights to Huaraz. The accessibility, power infrastructure and road network are excellent as the project is in the Aija-Ticapampa mining district where Minera Lincuna already operates several mines. Both Aija and Recuay are very mining-friendly towns and we are already providing jobs and business to the local communities. The reception has been very warm.
Because a project like Soledad does not have a large footprint, it does not have the environmental and social impacts of a huge low-grade deposit that takes years to drill out. It is a very compact project in a good mining area. We can move along quickly, which is very important in a cyclical industry like mining.
What is your focus for 2018?
The critical thing for us is to keep drilling. We have an expanded program this year and by the end of 2018, we should have enough information to put together our first resource, which would cover at least two of the pipes. The pipes crop at surface but are steep, cylinder-like bodies so it takes a significant amount of drilling to properly understand the mineralization, tonnage, and grades. We are also working on the mineralogy and initial metallurgical tests. The focus is to keep our head down and put the money into the ground. Soledad is an exceptional project and we have put together a very talented technical and management team to determine its ultimate potential.