Outcrop Gold to Acquire High-Grade Santa Ana Silver Project in Colombia
Outcrop Gold to Acquire High-Grade Santa Ana Silver
Project in Colombia
Vancouver, British Columbia--(Newsfile Corp. - May 14, 2019) -
Outcrop Gold Corp.
(
TSXV: OCG
) ("
Outcrop
" or the
"
Company
") is pleased to announce that it has entered into an agreement (the "
Agreement
") with Cedar Capital Corporation
("
Cedar
") to acquire the Santa Ana Silver Project (the "
Property
") in consideration for 7,000,000 common shares of the
Company (the "
Transaction
").
The Property comprises 669 hectares in the core of the historical Mariquita silver district, one of Colombia's most prolific
colonial silver mining camps with production dating back to the 16th century and continuing until at least 1914. The Santa Ana
Mine Group was one of the more important producers in the district. The Property is located approximately 190 kilometres east-
northeast of Bogota in Tolima, Colombia. The social, security and logistical aspects of the property are considered favourable.
The grade of the colonial Santa Ana mines is described in a NI 43-101 Technical Report completed on the Santa Ana property
for CB Gold dated April 2013, coauthored by Doublewood Consulting Inc. and Antediluvial Consulting Inc., that cites the following
archival information from historical Spanish documents regarding past production at Santa Ana:
"The La Porfia, El Dorado, La Manta and La Obdulia mines are located within the property as part of the historic colonial
Santa Ana silver mines. The average smelter return for silver ore during those days was '4 marcos per quintal' (approximately
17 kg/t Ag) according to official reports of Hacienda Santa Fe (year 1585) also reporting widths exceeding 1 1/2 varas (4 1/2
feet). More veins were discovered in the Santa Ana (today Falan) and Frias region following exploration during the sixth
century, adding 14 new mines to the district, all of them producing over 1 marco of silver per quintal (approximately 4.3 kg/t
Ag)."
There is very limited access to any of the colonial workings as most of the adits are either flooded or have collapsed.
Most
accessible workings are from nineteenth and early twentieth century production - but the veins developed by colonial era mining
will be incorporated into a systematic exploration program to be conducted by Outcrop Gold. The ancient mining history, the 11
km extent of the Mariquita district within the Tolima belt mineralization that extends over 25 km, and the high grades of silver and
gold reported in the Santa Ana mines suggest that the Project is in one of the most prospective silver-gold vein systems in
Colombia.
The Santa Ana Project is central to the Mariquita district and covers six mapped and interpreted vein zones that taken together
accumulate over 6 km of total strike. Each zone contains a package of several parallel veins. Veins mapped to date are north-
south, but locally east-west veins are observed, and some historic reports indicate production from both vein-trends. The district
has a 2.5 km width, with numerous north-south and east-west veins distributed within the north-trending regional Palestina fault
zone in second and third order faults.
Figure 1 notes: Mapped and inferred veins and historic mine areas from Condor. It is likely more veins will be
discovered.
To view an enhanced version of Figure 1, please visit:
https://orders.newsfilecorp.com/files/6343/44765_f48563c474f48a23_001full.jpg
The veins are interpreted to be a composite of early polymetallic gold-silver orogenic thrust-fold related and later epithermal
open-space veins in highly deformed Paleozoic schist, quartzite and gneiss of the Cajamarca Formation. Veins are commonly
associated with small intrusive body margins. The orogenic veins may have an intrusive affinity, evidenced by associated
tungsten minerals. The veins are both high and low-angle and comprised of pyrite, sphalerite, galena, and silver-bearing
minerals and native silver in quartz, quartz-carbonate and quartz-adularia gangue. There are probably multiple overprinting
mineralization events over a very long period during rapid terrain uplift. The colonial mines reported average mine widths of 1.5
m and this generally conforms to observations in workings and in modern drill intercepts discussed below.
The veins range from
0.20 m to 4 m in width.
Historic Condor Precious Metals drill results
Condor Precious Metals completed a total of 1,170.5 m drilled in 8 holes on the Santa Ana project. All 8 holes were drilled from
a single platform from August 12th, to September 16th, 2012. The drill-holes were fanned out to test 100 m of strike and 150 m
down-dip below open workings locally showing assays greater than 10 g Au/t and 1,000 g Ag/t in channel sampling. All eight
holes intersected projected veins. Drill results are provided below.
Hole
From (m)
To (m)
Length (m)
Au (g/t)
Ag (g/t)
AgEq (g/t)
CP-1201
78.45
79.30
0.85
1.34
667
760
CP-1202
110.03
110.56
0.53
1.21
389
473
CP-1203
83.82
86.86
3.04
3.68
1495
1751
CP-1203
100.58
102.40
1.82
1.26
1378
1465
CP-1204
133.15
134.97
1.82
0.47
149
182
CP-1205
70.10
74.70
4.60
0.32
179
201
CP-1205
88.00
88.80
0.80
1.64
532
646
CP-1205
104.84
107.22
2.38
0.38
193
219
CP-1206
124.66
125.15
0.49
0.34
742
765
CP-1206
137.00
137.66
0.66
1.89
685
816
CP-1207
170.47
170.76
0.29
2.45
746
916
CP-1208
164.00
169.16
5.16
3.51
527
771
includes:
164.00
165.34
1.34
10.17
1839
2545
Table Notes: Intersections were composited using a cut-off grade of 100 g/t AgEq, calculated as g Ag/t plus Au times
69.44 (assuming Au price of US $1,250 per ounce and Ag price of US $18 per ounce)). Intersected lengths do not
represent true vein thicknesses which are generally 25 to 30% less. Azimuths and dips are not available at the date
of this news release.
Figure 2 notes:
Typical drill sections from Condor Precious Metals drilling below workings. 25 to 30 m grid looking
south. Veins here are high angle with three veins occurring over intervals of 15 to 25 m.
To view an enhanced version of Figure 2, please visit:
https://orders.newsfilecorp.com/files/6343/44765_f48563c474f48a23_002full.jpg
Reconnaissance prospecting
Preliminary prospecting was carried out by Condor between 2012 and 2014. Chip samples across the vein collected in 2012
from the historic Santa Ana mine tunnels returned assay values as high as 11 g/t Au and 2,820 g/t Ag. Other high silver values
from veins included 929 g/t Ag, 600 g/t Ag and 443 g/t Ag. Values for Condor prospecting samples ranged from less than 50 g
Ag/t to 4,530 g Ag/t from veins from sample widths of 0.20 to 1.0 m.
Chip samples collected by Condor from outcrops in 2013-2014 returned several high gold values along with high silver values,
including: 68 g/t Au and 422 g/t Ag; 48 g/t Au and 81 g/t Ag; and 36 g/t Au and 163 g/t Ag. The high gold values suggest that
precious metal zonation may occur with Ag:Au ratios varying across on the project.
Follow-up reconnaissance prospecting from 2016 to 2018 that returned values from 52 to 250 g Ag/t from surface samples on
the project and up to 600 g Ag/t along southern extensions to the Santa Ana mine vein system near the project.
Transaction
Pursuant to the Agreement, the Company will acquire all of the issued and outstanding shares of Cedar's wholly-owned
subsidiary Malew Overseas S.A. ("
Malew
").
Malew's wholly owned subsidiary Lost City S.A.S. owns the Property.
In connection
with the Transaction, the Company proposes to issue 350,000 common shares (the "
Finder's Shares
") to Morten Borch, an
arm's length party to the Company, as a finder's fee.
The closing of the Transaction is subject to various conditions, including the
completion of satisfactory due diligence by Outcrop, and the approval of the Transaction and the Finder's Fee by Outcrop's
board of directors and the TSX Venture Exchange.
QA/QC for Historic Drilling
Condor's quality control procedures during collection of drill core data included the insertion of commercial certified standards
and blanks. Rock and drill core samples were sent to the ALS laboratories sample preparation laboratory in Bogota, Colombia,
where they were dried, crushed, split and pulverized. The 250g pulps were then sent to Condor's head offices in Vancouver,
British Columbia, Canada and subsequently delivered to the ALS Laboratory in North Vancouver for analysis. The samples were
analysed for gold using standard fire assay on a 50-gram sample with a gravimetric finish, and for multiple elements by ICP-MS
using either an aqua regia (ME-MS41) or a four acid (ME-MS61) digestion. High silver results triggered ore grade Ag analysis
using the AG-OG62 procedure. Outcrop Gold thinks that the Condor drill results are reliable at this stage of exploration.
About Outcrop Gold
Outcrop is a gold prospect generator active in Colombia.
The Company emphasis is on acquiring gold exploration projects with
world-class discovery potential.
Outcrop performs its own grass roots exploration and then employs a joint venture business
model on its projects to maximize investor exposure to discovery and minimize financial risk.
Outcrop has Newmont Goldcorp as
an active funding partner on its Lyra project in Antioquia directly south of Buritica.
Qualified person
The technical information in this news release has been approved by Joseph P Hebert, a qualified person as defined in NI43-
101 and President and CEO to the Company.
ON BEHALF OF THE BOARD OF DIRECTORS
Joseph P Hebert, Chief Executive Officer
Tel:
+1-775-340-0450
Email:
www.outcropgoldcorp.com
TSX Venture Exchange Disclaimer
Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
Certain information contained herein constitutes "forward-looking information" under Canadian securities legislation.
Forward-looking information includes, but is not limited to, statements with respect to the Transaction and the completion
thereof and the Company's ownership interest in the Property upon completion of the Transaction. Generally, forward-looking
information can be identified by the use of forward-looking terminology such as "potential", "we believe", or variations of such
words and phrases or statements that certain actions, events or results "will" occur. Forward-looking statements are based on
the opinions and estimates of management as of the date such statements are made and they are subject to known and
unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or
achievements of Outcrop to be materially different from those expressed or implied by such forward-looking statements or
forward-looking information, including: the receipt of all necessary regulatory approvals, capital expenditures and other costs,
financing and additional capital requirements, completion of due diligence, general economic, market and business
conditions, new legislation, uncertainties resulting from potential delays or changes in plans, political uncertainties, and the
state of the securities markets generally.
Although management of Outcrop have attempted to identify important factors that
could cause actual results to differ materially from those contained in forward-looking statements or forward-looking
information, there may be other factors that cause results not to be as anticipated, estimated or intended.
There can be no
assurance that such statements will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements
and forward-looking information. Outcrop will not update any forward-looking statements or forward-looking information that
are incorporated by reference herein, except as required by applicable securities laws.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/44765