Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Focus Ventures Ltd. (CVE:FCV) announced this morning high- to bonanza-grade silver intercepts from its Minas Chanca project in Peru.
Focus’s partner on the project, Compañia de Minas Buenaventura (NYX: BVN), is now beginning work on a resource estimation for some of the high-grade shoots identified by the recent sampling.
Buenaventura is undertaking a detailed underground and surface exploration program including 6,816m of diamond drilling to date. Surface drilling has identified extensions to the Santo Toribio and Santo Rosa vein system some 300m west of the of the old historic workings in an area concealed by colluvial cover.
Focus also reported that Buenaventura has nearly spent the required $3 million to earn a 75 percent interest in the Minas Chanca project. Once it does so, Focus said Buenaventura has a year to earn the balance for whichever sum is greater: $4 million or $4 per ounce silver in any resources Buenaventura calculates.
Buenaventura then has the option to buy Focus’ two percent net smelter royalty for $1 million.
Minas Chanca is high-grade past-producing silver mine located in the Central Peru Polymetallic Belt. It lies within the prolific Central Peru Polymetallic Belt, some 160km north of the Peruvian capital, Lima and 65km north of Focus’s Santa Rosa property.
The property comprises 1,200 hectares acquired by Focus in 2009 by direct staking, and two adjacent claims covering an additional 1,000 hectares subsequently acquired by Buenaventura and included in the Agreement. The former Ag-Pb-Zn mine is located midway between the provinces of Oyon and Cajatambo, some 160km north of the Peruvian capital, Lima, at altitudes of 4,400 – 4,900 m a.s.l. Minas Chanca is located 65km north of Focus’s recently acquired Santa Rosa property (see Press Release November 30, 2010).
References to mining at Minas Chanca date back to 1712 during Colonial times. Past mining took place over approximately 300 vertical meters via a system of galleries, cross-cuts and drives that exploited a number of veins and splays that cross-cut lower Calipuy andesites and volcanic breccias. The majority of silver-lead and zinc ore came from 3 principal veins, Candelaria, Tarazca and Santo Toribio, where early production reportedly yielded grades of 50 to 75 oz Ag/t. Other veins included the Prescilda, Shirley and Yanacelli veins.
This has been a good year for Focus Ventures so far. On Feb 6, the company closed a non-brokered private placement by issuing 7,037,000 units at $0.15 per unit, for gross proceeds of $1,055,550. The proceeds of that financing are being used for exploration of the Company’s mineral projects in Peru and Mexico, and for general working capital purposes.
