Gold | Silver
In December of 2020, Condor concluded an agreement with Calipuy Resources Inc. (“Calipuy”) whereby Calipuy will purchase Condor’s wholly owned Peruvian subsidiary, Minas Lucero del Sur S.A.C. (“MLDS”). MLDS is a sole purpose company, and the owner of the Lucero project.
Consideration is US$3.5 million, payable over five years. Should the price of gold be over US$2,500/ounce at the time of the final payment, total consideration will increase to US$4.0 million; and should the price of gold be over $3,000/ounce at the time of the final payment, the total consideration will increase to US$6.0 million. Calipuy have the option to compress the payment schedule to three years, and in such event, the total consideration will be US$3.0 million. Condor has received the initial payment of US$90,000.
Condor has maintained certain back in rights to participate in future Calipuy financings. Should Calipuy be completing a financing, Condor have the option to participate in the financing at a 20% discount to the financing price, by converting part or all of any outstanding payment due from Calipuy. Condor’s right to participate in a Calipuy financing is limited to 50% of the financing.
The Lucero property is located in the Chila Range of southern Peru, is approximately 130 kms northwest of the city of Arequipa and 600 kms southeast of Lima. The property is in the Chachas District, Castilla Province of the Department of Arequipa, about 22 kms southeast of Buenaventura’s Orcopampa mine.
The 21 sq km project was acquired by staking and prior to the sale to Calipuy, was 100% owned by Condor.
Sandstorm Gold Ltd. hold a 0.5% NSR on the Lucero project, and Sandstorm, Condor, Calipuy and MLDS have executed an NSR assignment agreement with respect to Sandstorm’s NSR, with Calipuy assuming the NSR obligations to Sandstorm.
Condor acquired via staking a 100% interest in 21 sq. km, 3 concessions, within the ex-Shila Au-Ag epithermal mining district in Peru. The property is 130 km NW of Arequipa and 25 km SE of Buenaventura’s Orcopampa mine, at elevations ranging between 5000m and 5500m. Buenaventura operated three underground mines on the concessions, and stopped mining in approximately 2005. The Shila Mining Camp includes several precious metal vein mines, of which the Sando Acalde, Pillune and Apacheta-shila were among the better known. The extracted ore was processed at a small plant east of the concessions and during the last five years of production by Buenaventura, the reported production averaged approximately 20,000 ounces of gold and 470,000 of silver per year at average grades of 14.7 g/t gold and 450 g/t silver. Historical mining was focused on low sulphidation vein deposits and to the best of our knowledge, there was no exploration below the area worked. We believe that potential remains for the discovery of additional high grade ore shoots below, and in the vicinity of the three former producing principal vein mines on the Lucero concessions, and in the numerous other veins and structures located on the property. Condor geologists have also identified a previously unmined and unexplored high-sulphidation epithermal zone in the north-west part of the concession with anomalous gold/silver values.
Signs of older workings indicate that the gold veins were known from well before, and were likely worked in colonial times.
A sampling program in late 2016 by an unrelated third party confirmed the bonanza grade precious metals reported from earlier mining operations, and reinforces the potential for Lucero to host additional reserves in the many structures (over 80 veins have been mapped at surface), and also in the prospectivity of the high sulphidation epithermal bulk tonnage target.
The sampling locations were dispersed over the concessions, and tested six different target areas. In total, 60 samples were taken and analyzed, with the majority (50) being outcrop channel samples. Most of the outcrop samples (forty-four of fifty) were taken at surface, while several of the outcrop samples (six of fifty) were taken from the wall rocks and mineralized structures inside the former underground workings. The balance of ten (non-outcrop) samples consisted of 8 grab samples take at surface, and 2 grab samples from inside the old workings. From the sixty samples, reported gold values ranged up to 144 g/t Au, with 21 of the samples reporting gold values greater than 1.0 g/t Au.
Silver values ranged from 0.1g/t Ag to greater than 10,000 g/t Ag, with 23 of the samples reporting silver values greater than 50g/t Ag. Sample number 3938, a 1.8m rock channel sample taken at surface from the principal vein in the Sando Acalde area, reported 18.9 g/t gold, and greater than 10,000 g/t silver (the upper analytical limit of the laboratory analysis utilized).
High grade ‘bonanza-style’ direct shipping ore was mined here in the past from low to intermediate sulphidation quartz-carbonate (rhodochrosite) massive sulphide veins. Lucero is one of many areas of low-sulphidation epithermal Au-Ag deposits hosted in Tertiary volcanics of the Central Andes Cordillera of southern Peru.