AbraSilver Resource farms out La Coiptia to Teck Resources, Argentina
AbraSilver Resource Corp. [TSXV-ABRA; OTCQX-ABBRF] entered into a binding letter agreement with a subsidiary of Teck Resources Ltd. [TSX-TECK.A, TECK.B; TECK-NYSE] with respect to a proposed option and joint venture agreement, to explore and develop the La Coipita copper-gold project in San Juan, Argentina.
The agreement provides that, subject to certain conditions, AbraSilver and Teck will enter into the option agreement to grant Teck an option to acquire an 80% interest in La Coipita by financing cumulative exploration expenditures of US$20-million over five years, making staged cash payments to, and an equity placement in, AbraSilver totalling US$3-million (including an initial mandatory payment of US$500,000), and making up to US$6.3-million in optional cash payments in respect of amounts payable to the underlying project vendors. Following an initial transition period during which AbraSilver will support field operations, Teck will act as operator for the duration of the option.
John Miniotis, President and CEO, commented, “We are delighted about the opportunity to secure a significant exploration agreement with Teck to advance the large-scale La Coipita project, which is located in a prolific copper porphyry district. This strategic collaboration will mark a significant milestone for the Project, and greatly enhance the potential for a major copper discovery. This transaction will represent a strong endorsement of the exploration potential at La Coipita and we look forward to working closely with Teck to unlock value for all stakeholders.”
The transaction remains subject to, among other things, the negotiation and execution of a definitive Option Agreement and related documents and the satisfaction or waiver of any conditions precedent in the Agreement (including the receipt of any requisite approvals). The company and Teck are expecting to enter into the Option Agreement on or about January 14, 2024 but there can be no certainty that the Transaction will be completed on the terms described in this press release or at all.
The La Coipita project is a district scale property consisting of over 70,000 hectares in the western portion of Calingasta Department, located in the mining-friendly San Juan Province of Argentina, adjacent to the Chilean border. Access to the area is via Calingasta, the nearest town, along 125 km of unpaved road to the Los Azules Cu-Mo porphyry project and then north along a dirt road to the La Coipita Cu-Au project. Elevation across the property ranges between 3,500 and 4,500 MASL with moderate to high relief.
Numerous target areas have been identified at La Coipita. These target areas have coincident geophysical, geological and geochemical features that are consistent with copper-gold mineralized porphyry-type intrusions, either beneath high-sulphidation systems or in structurally uplifted areas. To date, drilling has only been conducted on the La Coipita target, where the initial results have identified the potential for a major Cu-Au-Mo porphyry system. Significant exploration upside potential is believed to exist at the La Coipita target & across multiple other promising regional targets.