Canadian junior Latin Metals announced that it has signed a binding agreement with Golden Arrow Resources Corp. to acquire up to a 100% interest in the Huachi property, covering an area of 3,500 hectares and located in the province of San Juan. Huachi borders the Esperanza copper project, majority-owned by the company, allowing the firm to expand the exploration horizons of the venture.
By Panorama Minero
According to reports, Latin Metals will be able to earn an initial 75% interest in the project by incurring exploration expenditures totaling US$1 million and making additional cash payments of US$1 million to Golden Arrow, all over a period of four years. The definitive agreement will be completed within 90 days following this initial step taken by both companies, and is expected to enhance Esperanza's potential.
After exercising the option, Latin Metals will have an earn-in right whereby they can acquire the remaining 25% interest in the Huachi property, upon notification to Golden Arrow and a cash payment of US$2 million within 90 days following the exercise of the option. Upon acquisition, Golden Arrow's interest will be reduced to a 1% NSR (Net Smelter Return) royalty.
If Latin Metals chooses not to exercise the Earn-In Right, Latin Metals and Golden Arrow will form a joint venture, with Latin Metals holding 75% and Golden Arrow holding the remaining 25% to continue the exploration and development of the Huachi property. To maintain their interest in the JV, each party will contribute to work programs in proportion to their ownership. If either party dilutes its ownership to 15% or less, its interest will be reduced to a 1% NSR royalty.
About Esperanza and Huachi
Esperanza is a copper-gold porphyry exploration project where a copper-gold porphyry system has been partially defined by drilling and where a pyrite halo is exposed at surface over an area of 1,400m x 850m. Drill hole 18-ESP-025 (see news release May 8, 2018), completed by Latin Metals, returned 387m grading 0.57% copper and 0.27 g/t gold from surface, including 166m grading 0.84% copper and 0.37 g/t gold from surface (true width unknown). Mineralization is open in all directions with an interpreted vector to the west towards the Huachi property. Latin Metals has an option to acquire 100% interest in the Esperanza Property.
