|
Target: Previous explorers had defined non 43-101 compliant resources of sulfide mineralization. Current exploration targets are focused on giving definition to high grade silver zones directly beneath the pit.
Location: The property consists of 59 unpatented mining claims and 5,000 acres of fee land, about 5,800 acres in total. It is located about 25 miles northwest of the Rochester Silver Mine, one of the largest silver mines in the US and about 10 miles southeast of the Seven Troughs gold district. AuEx leased this property package from Newmont Mining Corporation in August 2005 (see NR05-4 August 11, 2005).
Ownership: AuEx signed an Exploration and Development Agreement with Piedmont Mining Company, Inc. Piedmont paid $10,000 in cash to AuEx on signing the Agreement. Piedmont has reimbursed AuEx $10,995 for claims fees and must expend at least $75,000 on exploration during the first year. In the second year, Piedmont must expend a further $125,000 on exploration. A total of $1,000,000 must be expended on exploration and development within the first three years to earn a 25% interest in the property and the project. Piedmont may then elect to expend an additional $1,000,000 prior to the 5th anniversary of the effective date of the Agreement to earn a 51% interest. At that point, Piedmont may elect to enter into a joint venture with AuEx or expend a further $2,000,000 on exploration and development to earn a 60% interest in the project and enter into a joint venture with AuEx at that point. Prior to the 3rd anniversary, the entire property package may be purchased from Newmont for $500,000, or for $1,000,000 after that date, subject to certain clawback provisions by Newmont and a sliding scale royalty that increases to 5% at silver prices above $10 per ounce. This royalty may be reduced by one percentage point under certain conditions.
History: Silver mineralization was discovered at Trinity by U.S. Borax in 1981 and was subsequently explored under a joint venture between U.S. Borax and Santa Fe Pacific Gold Corp. from 1982 until 1986 leading to the development of the Trinity mine that produced for a little over 2 years. The property was subsequently explored further by Santa Fe Pacific Gold in the period 1990 to 1992 but has seen no exploration since that time. Reports prepared by U.S. Borax at the conclusion of mining indicate that the property still contained about 4mm tons of silver mineralization grading over 2 ounces per ton silver.
According to Newmont records the Trinity silver mine, which was operated by U.S. Borax from 1987 to 1989, produced approximately 5mm ounces of silver from approximately 1.1mm tons of oxidized ore grading approximately 6 ounces silver per ton utilizing heap leach technology. The mine was subsequently reclaimed.
Geology: Mineralization is associated with rhyolites and high tin values making this an interesting possible analogue to the major silver deposits in Bolivia.
|
|
