Westminster Reaches Terms on Mostazal Copper Project in Chile's Atacama
Vancouver, British Columbia--(Newsfile Corp. - March 11, 2021) - Westminster Resources Ltd. (TSXV: WMR) (FSE: 08W3) ("WMR" or "Westminster" or the "Company") is pleased to announce that it has entered into an agreement on Indicative Terms with a private vendor to acquire a 100% interest in the 16-square kilometre Mostazal copper property located in the Atacama region of Chile, 80 kilometres northeast of Copiapo. The Atacama Desert is among the richest copper regions on earth, hosting some of the world's most significant porphyry copper deposits. The Mostazal property is situated within the 500-kilometre long, north-south trending Domeyko Fault System, the major structural control for the majority of Chile's largest copper mines including Escondida (BHP, Rio Tinto), Chuquicamata and the El Salvador mine (Codelco).
"We set out to secure an asset that was both transformative to the Company and complimentary to our current portfolio and I believe we've achieved this," said Jason Cubitt, President and CEO. "It's rare to find a property in this jurisdiction with a technical feature set that so clearly describes a copper porphyry target - yet remains untested by drilling. And with the potential to resume and expand upon historic production this was indeed an opportunity we couldn't turn down."
HIGHLIGHTS
- Known mineralization occurs in an area of stacked and discontinuous stratified lenses measuring 2.5km long by 2km wide and 300m deep.
- Reported historical production of 120,000 tons processed with average grade of 1.8% Cu.
- High quality geophysical targets support thesis that near-surface, copper-rich mineralization may be a distal expression of a much larger porphyry deposit at depth.
- Four-year Option to earn 100% interest
Mineralization occurs in an area of stacked and discontinuous stratified lenses measuring 2.5km long by 2km wide and 300m deep. The supergene mineralization at Mostazal is comprised of malachite, azurite, chrysocolla, atacamite, hematite and limonite. Host rocks are porphyritic andesites. The principal sulfide observed is chalcocite that is disseminated in the rock matrix but also present as fine veinlets. Bornite, chalcopyrite and native copper are also present. The property contains several historical artisanal workings exploiting near surface, high-grade copper mineralization. Historically, the hypogene mineralization was only exploited in areas of local oxidation.
- The reported historic production of 120,000 tons were processed with an average grade of 1.8% Cu.
In addition, a historic resource was generated for the Mostazal property:
- Indicated Resource of 10 million tons @ 0.95% Cu, 8 g/t Ag
The original source of the presented historical estimate is from APGC Corp Chile SAP, 2015. The known parameters used to calculate the historical estimate are using 60 diamond drill holes (11,379 m), a cut grade of 0.5% Cu off for indicated Resources. It is unknown if the historical estimate uses the current resource categories as defined by CIM; the differences to the CIM categories are not known. To upgrade and verify the historical estimates the Company would need to verify the historical drilling and engage the services of a professional resource estimator. The qualified person, Derrick Strickland, has not done sufficient work to classify the historical estimate as a current mineral resource. The Company is not treating the historical estimates as a current mineral resource.
An exploration program was undertaken in 2012-2013 by a previous operator. This work included detailed geological surveys, mapping, induced polarization (IP), ground magnetics surveys, and surface sampling of outcropped mineralization. In addition to the surface work, the drill program of 60 shallow diamond drill holes was completed for a total of 11,379 metres drilled.
Although 2012-2013 drilling prioritized work on the stratified lenses, several high quality and deeper IP geophysical targets were also identified. IP geophysical targets to the south of the known stratified lenses support the thesis that near-surface mineralization may be a distal expression of a much larger porphyry system at depth. This thesis will be central to Westminster's target generation and the first ever scheduled drill testing of copper porphyry targets at Mostazal.
The Company currently believes a comparable model for the project is the nearby El Salvador mine. The El Salvador mine is 40km north of Mostazal and geologically on trend with similar lithology, age (Upper Eocene), and within the same Domeyko Fault system. A reconstructed model of El Salvador shows that the secondary blanket started about 600 metres below the original uneroded surface. On January 5th 2021, Codelco announced a $1.38 billion expansion of the El Salvador mine, extending its productive life by 40 years and increasing output by 30%. The original underground reserves at El Salvador, which began operation in 1959, were approximately 300 million short tons of 1.6% copper, mostly secondarily enriched ore [Economic Geology and the Bulletin of the Society of Economist Geologists, Vol. 70, No. 5 August 1975, page 857-912]. In January 5, 2021 Codelco announced a $1.38 billion expansion of the El Salvador mine, extending its productive life by 40 years and increasing output by 30%.
The qualified person, Derrick Strickland, has been unable to verify the information on the El Salvador mine and the information disclosed is not necessarily indicative of mineralization on the Mostazal property. In addition, the qualified person has been unable to verify the historical production on the property.
Westminster is collecting and analyzing all available data which will be integrated to develop a new exploration model on the property.
The Company is in the process of establishing and staffing a field office from which Mostazal and other regional assets will be managed.
PROJECT ACQUISITION TERMS
- USD40,000 Initial Exclusivity Fee (90-day due diligence period)
- Cumulative $2.9m payment and $2.6m expenditure to earn 49% by third anniversary
- Cumulative $5m payment and $5m expenditure to earn 100% by fourth anniversary (subject to 2% NSR retained by the vendor)
| Year | $ Payment to Vendor | $ Minimum Work Expenditure | $ Annual Total | $ Cumulative Total |
| 0 | 200,000 | 200,000 | 200,000 | |
| 1 | 300,000 | 300,000 | 500,000 | |
| 2 | 800,000 | 1,200,000 | 2,000,000 | 2,500,000 |
| 3 | 1,600,000 | 1,400,000 | 3,000,000 | 5,500,000 |
| 4 | 2,100,000 | 2,400,000 | 4,500,000 | 10,000,000 |
All figures in US Dollars
Figure 1: Mostazal Claims
To view an enhanced version of this graphic, please visit:
https://orders.newsfilecorp.com/files/1134/76881_ce639fa5848f9929_001full.jpg
Technical information in this news release has been reviewed and approved by Derrick Strickland, P. Geo., a qualified person as defined in National Instrument 43-101.
FOR FURTHER INFORMATION CONTACT:
Jason Cubitt
President and Chief Executive Officer
Westminster Resources Ltd.
Telephone: 604-681-3170
info@westminsterresources.com
westminsterresources.com
Neither the TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of accuracy of this news release.
Forward-Looking Statements
This news release contains certain forward-looking statements, which relate to future events or future performance and reflect management's current expectations and assumptions. Such forward-looking statements reflect management's current beliefs and are based on assumptions made by and information currently available to the Company. Readers are cautioned that these forward-looking statements are neither promises nor guarantees, and are subject to risks and uncertainties that may cause future results to differ materially from those expected including, but not limited to, market conditions, availability of financing, actual results of the Company's exploration and other activities, environmental risks, future metal prices, operating risks, accidents, labor issues, delays in obtaining governmental approvals and permits, and other risks in the mining industry. All the forward-looking statements made in this news release are qualified by these cautionary statements and those in our continuous disclosure filings available on SEDAR at www.sedar.com. These forward-looking statements are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances save as required by applicable law.
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