Freehill Mining (ASX: FHS) has completed the acquisition of the El Dorado project in Chile which directly adjoins its existing flagship 67-million-tonne Yerbas Buenas magnetite operation.
In August, Freehill reported extensive rock chip sampling and mapping at El Dorado had led to the discovery of three new mineralised targets.
High-grade iron, copper and gold were present in the rock chip samples.
The 750-hectare El Dorado property was bought from Chile’s Minera El Dorado SCM.
Freehill chief executive officer Peter Hinner said El Dorado is a key part of the company’s growth strategy.
Freehill signals future project add-ons
Mr Hinner said El Dorado is “without doubt, a highly valuable and prospective asset that adds considerable value” to the company.
“Acquiring quality projects in and around Yerbas Buenas is a key part of our strategy,” he added.
While advancing development of the Yerbas Buenas project and its JORC magnetite resource, Freehill completed a five-day mapping and sampling program at El Dorado in July.
Assays include 9.93% and 4.02% copper, 22.1 grams per tonne and 13g/t gold, and 36% and 29% iron.
El Dorado covers 750 hectares and consists of eight tenements. It adjoins the northern boundary of Yerbas Buenas.
Last week, Freehill reported metallurgical testing results that confirm the high quality of ore at its Yerbas Buenas magnetite project in Chile.
A concentrate of more than 62% iron ore concentrate has been produced using a totally dry process at high iron recoveries.
El Dorado in Chilean elephant country
The completion of the El Dorado deal will provide an additional 4km of northern reach for Freehill along the Atacama-El Tofo fault zone.
Some 11km to the north-northeast is El Tofo, Latin America’s oldest iron ore mine.
Also within 7km to 22km of El Dorado are the Higuera region with its numerous copper mines, the new El Tofo Norte magnetite project owned by Chile’s largest steel producer CAP Group, and the $1 billion Dominga copper-iron ore project owned by Chile’s Andes Iron.
There is also the historic Santa Dominga gold mine which was operational in the 1970s and 1980s where mineralisation consisted of a 500m-long gold vein from which a reported 3Mt at 3g/t gold was produced.