Azure Minerals acquires gold, cobalt project in Mexico

Azure Minerals AZS acquires gold cobalt project Mexico

Azure Minerals (ASX: AZS) has strengthened its Mexican exploration portfolio with the purchase of the Sara Alicia gold-cobalt project, located in the northern state of Sonora.

Key Highlights:

  • Azure has acquired 100% ownership of the high-grade Sara Alicia gold-cobalt project.
  • Limited underground mining of gold and cobalt previously undertaken in 1930s.
  • Sampling returns very high grades of gold and cobalt in outcrop and in old mine workings.
  • Separate zones of copper-zinc-silver mineralisation also identified.
  • Follow-up exploration activities have commenced to define drill targets.

Sampling by Azure returned spectacular high-grade gold and cobalt results, including:

Azure Minerals gold cobalt zone Mexico
Gold-Cobalt Zone
Azure Minerals copper zinc silver zone Mexico
Copper-Zinc-Silver Zone

Azure Managing Director Mr Tony Rovira commented:

I am very excited by this new project. The high grades of gold and the exceptionally high cobalt assays have encouraged us to start drilling at Sara Alicia as soon as possible.

During Azure’s recent search for an advanced stage precious metal / base metal project, which culminated in the recently announced acquisition of the Oposura Project, the Company identified many early stage properties with good potential. One of the absolute stand-outs was the Sara Alicia gold-cobalt project.

Cobalt deposits are virtually unknown in Mexico, which makes the identification by our exploration team of a property containing high-grade gold and cobalt mineralisation very commendable. This was an opportunity too good to pass up and its acquisition has added an extra dimension to our Company’s project portfolio.

Spectacular grades returned from our first sampling program indicate that this under-explored property holds potential for the definition of a body of high grade gold-cobalt mineralisation, as well as for copper-zinc-silver mineralisation. We look forward to drilling Sara Alicia this year, along with progressing our flagship project Oposura.”

Key Terms and Background to the Acquisition

Early on in Azure’s search for new projects, the Company’s geologists identified the Sara Alicia district as an area of interest for precious and base metal mineralisation, including cobalt.

The mineral concession that covered the historical Sara Alicia mine workings had recently been cancelled by the Mining Registry and was potentially unavailable for staking for several years.

However, Azure’s legal team identified a course of action that, with the cooperation and assistance of the previous owners, enabled the cancellation to be revoked, and the ownership to be transferred to Azure’s wholly-owned Mexican subsidiary company Minera Piedra Azul SA de CV.

In recognition of their assistance, Azure made a payment of US$125,000 to the previous owners, a local Mexican family who had held title to the Sara Alicia mineral concession since the 1930s.

A further and final payment of US$125,000 will be made to the family upon the project achieving commercial production. No royalties are payable over future mineral production and there are no back-in, earn-back or other rights.

Project Summary

Sara Alicia is located on the western flank of the Sierra Madre Occidental mining province which hosts major operating gold, silver and copper mines (see Figure 1).

Access to site is good with a sealed road to the town of Alamos and the nearby Piedras Verdes Copper Mine, and then via gravel roads to site.

Sara Alicia Project Mexico AZS
Figure 1: Plan showing location of Sara Alicia Project.

Historically, Sara Alicia was a small-scale producer of gold and cobalt in the 1930s from an underground mining operation. No production records are available, however historical plans and reports indicate that the mine was operated on six levels to a depth of approximately 60m below surface.

The Sara Alicia mineral concession covers nine hectares and contains all historical mine workings and all observed exposures of outcropping gold-cobalt mineralisation. A surrounding tenement that covered more than 22,000 hectares recently expired. The Mexican Mining Registry has yet to declare this vacant area available for claim and Azure will work to acquire these mineral rights when they become available.

Azure has carried out reconnaissance mapping and sampling within the Sara Alicia concession and in the surrounding district. Sampling of outcrops, mine dumps and old mine workings returned many significant assay results.

Geologically, the Sara Alicia prospect hosts a thick sequence of carbonate rocks which have been intruded by a granodiorite porphyry. This intrusive event caused alteration and mineralising reactions in the limestones forming skarns, with precious and base metal mineralisation introduced into several separate horizons (or mantos) within the limestone sequence. One manto hosts the gold-cobalt mineralisation, while two and possibly more mantos contain copper-zinc-silver mineralisation.

All observed outcrops of the gold-cobalt manto are located within the Sara Alicia mineral concession. Additionally, mantos containing copper-zinc-silver mineralisation were observed and sampled within both the Sara Alicia concession and in the surrounding area.

Historical reports contain descriptions of similar occurrences elsewhere in the surrounding district, and these references will be checked by Azure’s geologists during their follow-up exploration.

Azure’s forthcoming exploration program will start with surveying of the old mine workings, geophysical surveys and detailed geological mapping and sampling. This will be followed up by drilling to test identified targets. First field activities have already commenced.

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