Chakana Provides Initial Results of a Technical Review of Breccia Pipe 1: Controls ON Metal Distribution and GOLD-Rich Nature of Mineralization
NEWS RELEASE
CHAKANA PROVIDES INITIAL RESULTS OF A TECHNICAL REVIEW OF
BRECCIA PIPE 1: CONTROLS ON METAL DISTRIBUTION AND GOLD-RICH
NATURE OF MINERALIZATION
Vancouver, B.C., May 19, 2020 – Chakana Copper Corp . (TSX-V: PERU; OTCQB:
CHKKF; FRA: 1ZX) (the “ Company ” or “ Chakana ”), has advanced the mineral occurrence
and geological model of Breccia Pipe 1 (Bx 1, Fig. 1) at its Soledad project in Ancash, Peru. Bx 1
is one of twenty-three outcropping breccia pipes at Soledad and part of a cluster of 92 targets
awaiting drill testing. This in-house study was con ducted to document the controls on
mineralization, to detail the distribution of gold, silver and copper within the upper-most part of
the breccia pipe, and to look at various metal-mine ralogical domains that will factor into the
eventual resource models. Drill assays, mineralogy, and detailed core logs from the top 215m of
the breccia pipe between an elevation of 4,345m (su rface) and 4,130m were included in the study.
This interval was selected because of the density o f drill information and corresponding control
on the pipe geometry, contacts, metal distribution, and breccia characteristics. The study is based
on 6,787 assay intervals from diamond drill core pr eviously reported between October 25, 2017
and October 18, 2018 (see Chakana’s website and ass ociated disclosure documents filed on Sedar
for details). Sample intervals are dominantly 1 met re in length; some shorter sample intervals
down to 0.1m were also collected to honor geologic contacts.
Advisory : This is not a resource estimate. It is based upon the entire suite of continuous core
samples from Bx 1. Average values quoted refer excl usively to said core samples and not the
volume of enclosing rock. No advanced geostatistica l treatment of the data, similar to that
undertaken during resource estimation, has been app lied. The results of this study are viewed in
the light of exploration guidelines, including pote ntial metal and mineral zoning relationships and
what is required to test similar targets elsewhere at Soledad.
Summary of Findings
Based on this study, several important controls are recognized:
• Gold is relatively enriched in the top 70 metres of the breccia pipe, with assay intervals averaging
4.76 g/t from surface to 4,275m elevation. Assays i ntervals located from the edge of the breccia
pipe toward the interior of the pipe, show increasi ng gold to 7 metres, averaging 2.61 g/t. Samples
located from 7 to 15 metres average 1.65g/t, and then drop below 0.5 g/t for samples located in the
inner- most part of the pipe.
• Copper and Silver content are most elevated in assa y intervals within the margin of the breccia
pipe, averaging 1.11% copper and 76.6 g/t silver fr om the contact to 3 metres into the breccia.
Assay intervals located from 3 to 15 metres from th e margin of the breccia, have copper and silver
averages of 0.95% and 51.5 g/t, respectively. Like gold, samples located in the inner most part of
the pipe have lower copper and silver values, averaging 0.42% and 25.5 g/t, respectively.
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• The two most common breccia types observed in drill core are shingle and mosaic. Samples of
shingle breccia average 2.55 g/t gold, 71.3 g/t silver, and 1.25% copper; samples of mosaic breccia
averages 1.81 g/t gold, 50.9 g/t silver, and 0.91 % copper.
• Distinct vertical zoning is observed with higher go ld near the surface and increasing copper and
silver at depth with local elevated gold.
“These results improve our understanding of mineral ization at Soledad, and in particular the
geological controls on gold distribution and zones with very high metal concentrations,” said
President and CEO David Kelley. “The potential of t his project is enormous when you consider
the number of targets to be tested and the fact tha t we have never seen the bottom of a breccia
pipe yet or the causative intrusion. We look forwar d to testing these targets with an improved
understanding of how these mineral systems form,” a dded Kelley.
Tourmaline Breccia Pipes
Chakana has now identified twenty-three tourmaline breccia pipes on the Soledad land package
and drill tested seven pipes to date. A unique aspe ct of tourmaline breccia pipe formation is that
they do not reach the paleosurface; they occur at d ifferent elevations and are exposed at surface
by erosion of the overlying rock column. They origi nate from a fluid-saturated intrusion at depth
due to the accumulation of over-pressured volatile gases leading to a violent eruption that breaks
the overlying rock column above the intrusion. Subs equently hydrothermal fluids invade the
brecciated rock column, precipitating sulfide miner al assemblages in the void spaces in the
breccia (cement) and often replacing clasts and mat rix. Typical characteristics of tourmaline
breccia pipes include 1) they continuously span ver tical heights of 500 metres and more, 2)
shapes that increase in diameter at depth toward th e causative intrusion, 3) angular to flat tabular
breccia clasts demonstrating minimal transport, 4) high amount of open space between the breccia
fragments due to limited development of fine rock d ebris (“rock flour”), 5) sub-horizontal shingle
breccia textures from clasts collapsing downward in the breccia pipe, and 6) high porosity of the
breccia, particularly at the margin where the brecc ia contacts the wall rock. Elsewhere in South
America, alteration mineral assemblages transition from quartz-tourmaline-sericite in the upper
portion of the breccia pipe, to quartz-tourmaline-magnetite-secondary biotite in the deeper portion
of the breccia pipe closer to the intrusion. Second ary biotite has not been seen within the breccia
at Soledad in drilling to date, suggesting that the lower portions of the breccia pipes and the
causative intrusion are preserved at depth.
Mineralogy
Petrographic studies are ongoing and have been carr ied out on drill core from different breccia
pipes to determine mineralogy and paragenesis. Pyri te and chalcopyrite are the most common
sulfide minerals, followed by varying amounts of sp halerite, galena and tetrahedrite, plus trace
bournonite, boulangerite, and cosalite. Gold occurs both as free grains and inclusions in early
pyrite, and in Bx 5, as a late free gold event that cross cuts all previous sulfide phases. This late
free gold event has not yet been observed in Bx 1 b ut is suspected to exist based on the high gold
assays in portions of the pipe. Arsenopyrite is abundant in the upper parts of Bx 1, but only occurs
in trace amounts in Bx 5 and Bx 6. Gold has not bee n observed in association with arsenopyrite to
date. Silver occurs primarily in galena, tetrahedrite and perhaps other yet recognized phases.
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Breccia Pipe 1 (Main and North Zones)
Previous drilling at Bx 1 outlined mineralization t o a depth of approximately 490m. During
drilling, the shape of the breccia pipe was modeled using observed contacts measured by
geologists logging core. The breccia pipe and miner alization are open at depth. The pipe forms a
prominent bulge in the hill side at surface where i t has been exposed by erosion. A second, blind
breccia pipe was discovered 40m north of the main p ipe (North Zone, Fig. 1) while drilling Bx 1
(Main Zone). The top of the North Zone is approxima tely 125m below surface. Given the
proximity of the Main and North zones, data from each pipe were evaluated together.
Figure 1 – View looking west at Bx 1 Main and North Zones showing distribution of drill traces (gray lines) and
sample interval points (black dots) investigated in this study.
Metal Distribution Versus Breccia Characteristics
All clasts observed to date at Bx 1 are from the en closing wall rock, consisting of andesitic lithic
tuff, andesite, and pre-mineral monzodiorite. Two p rimary breccia textures are logged at Soledad:
1) shingle breccia, and 2) mosaic breccia (Fig. 2). Shingle breccia has flat tabular angular clasts in
general alignment due to settling or downward trans port within the breccia pipe. Mosaic breccia
has more equant angular to sub-rounded clasts due t o greater transport of the clasts during
formation (fluidization). Basic statistics for gold , silver and copper assays for each breccia type
are shown in the table below. The higher results fr om shingle breccia are interpreted to reflect
greater open space between the breccia fragments (h igher porosity) compared to the mosaic
breccia that often has a higher amount of rock flour matrix.
In addition to breccia texture, the type of cement and matrix of the breccia is also logged. The two
most common types of cement are sulfide minerals an d tourmaline. Except near surface the
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strongest mineralization is in shingle breccia with sulfide cement, followed by mosaic breccia
with sulfide cement.
Shingle Mosaic Shingle
Sulfide Cement
Shingle
Tourmaline
Cement
Mosaic
Sulfide Cement
Mosaic
Tourmaline
Cement
n 1,896 4,152 1,014 881 2,117 2,063
Au g/t min 0.018 0.003 0.21 0.18 0.003 0.003
Au g/t max 33.60 42.30 33.60 17.87 42.30 35.45
Au g/t mean 2.55 1.81 3.46 1.45 1.68 1.94
Au g/t median 0.74 0.45 1.27 0.51 0.54 0.34
Ag g/t min 0.09 0.05 0.22 0.09 0.05 0.07
Ag g/t max 2,590.0 1,780.0 2,590.0 649.0 1,345.0 1,780.0
Ag g/t mean 71.3 50.9 86.8 52.9 69.2 31.3
Ag g/t median 32.4 14.3 40.0 21.9 25.3 6.5
Cu % min 0.001 <0.001 0.001 0.001 <0.001 <0.001
Cu % max 10.50 15.70 10.50 6.79 15.70 13.05
Cu % mean 1.25 0.91 1.61 0.81 1.44 0.34
Cu % median 0.77 0.12 1.12 0.35 0.86 0.02
Figure 2 – Example of breccia texture and cement ty pe: a) shingle breccia with sulfide cement, b) shin gle breccia
with tourmaline cement, c) mosaic breccia with sulfide cement, and d) mosaic breccia with tourmaline c ement.
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Metal Distribution Versus Pipe Geometry
Individual core samples were assessed relative to t heir location within the breccia pipe based on
measuring the horizontal distance from the edge of the breccia pipe to the center of the sample
interval. In this way, samples can be compared at various distances from the margin of the
breccia pipe. Assay results for samples grouped by one metre intervals were averaged to see if the
breccia pipe geometry affects the metal concentrati on (Fig. 3). Gold shows two distinct patterns:
1) increasing concentrations from the margin to 7m, then 2) decreasing concentrations towards
the interior of the pipe. Copper and silver are ele vated in samples located withing three metres of
the margin, then have relatively consistent concent rations to 15m. Samples from the inner-most
part of the breccia pipe have the lowest values.
Figure 3 – Average metal values in core samples loc ated at various distances (m) from margin of breccia pipe
(relative position of contact with wall rock shown as vertical dashed line) for gold, silver and coppe r. Number of
samples included in each interval distance shown in legend.
Metal Distribution Versus Elevation
While logging core from Bx 1 it was apparent that d istinct mineral zones exist. Corresponding
drill assays showed that some intervals are elevate d in gold, while others are elevated in copper +
silver, and still others are elevated in all three metals. To examine metal distribution versus
elevation, ternary diagrams were constructed to sho w the relative contribution of gold, silver and
copper within a given elevation range. These plots emphasize zoning of metals within a given
elevation and between elevations.
No allowance for mining and processing recoveries a re made. Results are shown for 5 elevation
zones (Fig. 4). The highest elevation interval, fro m surface (4,345m) to the base of partial
oxidation (4,310m), shows that gold is enriched wit h relatively minor contributions from silver
and copper. In this zone pyrite is present but chal copyrite, the dominant copper mineral, is
completely oxidized. The second interval, from 4,31 0m to 4,275m, shows gold is still dominant,
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with increasing contribution from copper and silver . This interval contains moderate supergene
copper enrichment (chalcocite and covellite) and pr imary sulfide mineralization. The third
interval, from 4,275m to 4,225m has moderate to hig h metal values, equally distributed between
copper, gold, and silver. This and the two lower el evation zones consist of primary
mineralization. The interval from 4,225m to 4,175m has moderate to high metal values dominated
by copper and silver. The deepest interval evaluate d, from 4,175m to 4,117m, shows moderate to
high metal values distributed between copper, silver and gold. This distinct metal zoning is shown
spatially in Figure 5.
Figure 4 – Ternary plots showing relative metal val ue for gold, silver, and copper for the five elevat ion zones (above
sea level). Colored dots represent total metal value for each sample interval using USD$1,500 oz gold, USD$18 oz
silver, and USD$2.50 lb copper.
Metal prices used are gold: USD$1,500/oz, silver: USD$18/oz, and copper: USD$2.50/lb
Metal Value Calculation Formula:
[Au (g-m)÷(31.1035x1500)]+[Ag (g-m)÷(31.1035x18)]+[Cu (%-m)÷(2204.62÷100x2.5)] = Sum Metal Value (SMV)
Percent of Metal Values Formula:
[Au (g-m)÷(31.1035x1500)]÷SMVx100=Au Value%
[Ag (g-m)÷(31.1035x18)]÷SMVx100=Ag Value%
[Cu (%-m)÷(2204.62÷100x2.5)]÷SMVx100=Cu Value%
• The percentage of the total value for gold, copper and silver were then plotted on the ternary diagrams.
• This approach emphasizes metal zoning patterns that are suitable for exploration modelling. It has no
bearing on mineral resources and none are implied.
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Figure 5 – View looking west showing distribution o f: A) gold, B) silver, and C) copper in the top 215 metre extent
of Bx 1. Values plotted are gram-metre for gold and silver, and pound-metre for copper. Elevation ranges shown in
Figure 4 indicated by dashed white lines.
Conclusions
Mineralization at Bx 1 is polymetallic with attract ive concentrations of gold, silver and copper.
Higher concentration intervals tend to cluster, cre ating domains of rock that will become key
features within a resource estimate. Higher concent rations of metals occur in breccia types with
high primary porosity. These zones are often locate d around the margin or outer extent of the
breccia pipe. Distinct metal-mineralogical zoning i s observed and likely relates to temperature
variation with distance from the underlying fluid s ource. The Bx 1 model helps to set baselines
and certain thresholds for the on-going exploration at Soledad and will be key to moving the
project forward.
Sampling and Analytical Procedures
Chakana follows rigorous sampling and analytical pr otocols that meet or exceed industry
standards. Core samples are stored in a secured are a until transport in batches to the ALS facility
in Callao, Lima, Peru. Sample batches include cert ified reference materials, blank, and duplicate
samples that are then processed under the control o f ALS. All samples are analyzed using the
ME-MS41 (ICP technique that provides a comprehensiv e multi-element overview of the rock
geochemistry), while gold is analyzed by AA24 and G RA22 when values exceed 10 g/t. Over
limit silver, copper, lead and zinc are analyzed using the OG-46 procedure.
Results of previous drilling and additional informa tion concerning the Project, including a
technical report prepared in accordance with Nation al Instrument 43-101, are made available on
Chakana’s SEDAR profile at www.sedar.com.
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Qualified Person
David Kelley, an officer and a director of Chakana, and a Qualified Person as defined by NI 43-
101, reviewed and approved the technical information in this news release.
ON BEHALF OF THE BOARD
(signed) “ David Kelley ”
David Kelley
President and CEO
For further information contact:
Michelle Borromeo, Manager – Corporate Communicatio ns
Phone: 604-715-6845
Email: [email protected]
Neither TSX Venture Exchange nor its Regulation Ser vices Provider (as that term is defined in the policies of the
Exchange) accepts responsibility for the adequacy o r accuracy of this release.
Forward-looking Statement Advisory: This release ma y contain forward-looking statements. Forward-looki ng
statements involve known and unknown risks, uncerta inties, and other factors which may cause the actua l results,
performance, or achievements of Chakana to be mater ially different from any future results, performanc e, or
achievements expressed or implied by the forward-lo oking statements. Forward looking statements or inf ormation
relates to, among other things, the interpretation of the nature of the mineralization at the Soledad copper-gold-
silver project (the “Project”), the potential to expand th e mineralization, and to develop and grow a resourc e
within the Project, the planning for further explor ation work, the ability to de-risk the potential ex ploration targets,
and our belief in the potential for mineralization within unexplored parts of the Project. These forwa rd-looking
statements are based on management’s current expect ations and beliefs but given the uncertainties, ass umptions and
risks, readers are cautioned not to place undue rel iance on such forward- looking statements or inform ation. The
Company disclaims any obligation to update, or to p ublicly announce, any such statements, events or de velopments
except as required by law.