THE BOURSE WHISPERER: Orinoco Gold (ASX: OGX) is to acquire Mining Leases encompassing Troy Resources former highly successful Sertão gold mine in central Brazil.
Orinoco has struck a deal with Troy Resources (ASX: TRY) and its Brazilian partner to acquire the Mining Leases, which will result in the company taking 100 per cent of the share capital of Sertão Mineração Ltda, the entity that owns the Sertão and Antena Mining Leases.
Location map showing location of all Orinoco’s leases including the
Sertão and Antena mining leases. Source: Company announcement
The leases are located just five and 28 kilometres by road from Orinoco’s Cascavel gold project, and are anticipated to become a key part of the company’s broader 70 per cent-owned Faina Goldfields project and its plans to fast track development of Cascavel.
Orinoco also has a Toll Treatment Agreement in place with Cleveland Mining (ASX: CDG) at the Premier gold mine.
The company said historic drilling at Sertão has demonstrated potential for extensions of mineralisation beneath the existing open pit.
Previous intersections include:
0.7 metres at 48.2 grams per tonne gold (GVD 029); and
0.33m at 119.6g/t gold (GVD080).
Orinoco said these results illustrate the continuity of the structure previously mined at Sertão.
“The addition of these Mining Leases to our project portfolio in central Brazil represents a major step forward in our strategy of becoming a near-term, high-grade gold producer,” Orinoco Gold managing director Mark Papendieck said in the company’s announcement to the Australian Securities Exchange.
“We now have several options for processing material from the decline at Cascavel, including toll treatment and the establishment of a mobile plant at Sertão, while we apply for a full-scale Mining Lease at Cascavel.
“The other really significant dimension to this purchase is that the historical drill results show that there is clearly the potential to define additional ounces immediately beneath the Sertão open pit and for us to add a second high-grade project to our portfolio with great exploration upside.
“The Sertão mine was a very successful high-grade producer with strong geological similarities to Cascavel.
“This is a major coup for the company and we are pleased that part of the consideration includes the issue of options which we hope will see Troy Resources, a well-known and successful gold producer, join our securities register.”