Southern Silver Exploration Corp. (“Southern Silver”;) reported today that it has finalized acquisition of a 100% interest in the Oro property consisting of 157 BLM claims by the payment of USD$150,000 to the underlying optionors.
The Oro property consists of 157 BLM claims, two State leases and patented land comprising approximately 17.2 sq km. Since 2006, Southern Silver has paid total monetary consideration of USD$1,083,382 to purchase the claim package. The Oro property is subject to a 2% net smelter return royalty which may be purchased for $2 million.
To fund payment of the balance of the purchase price, Southern Silver received payment of USD$150,000 from Desert Star Resources Ltd. (“Desert Star”) which holds an option to acquire up to a 70% interest in the Oro property by the issuance of 1,000,000 common shares and incurring expenditure of USD$6 million on exploration and development work together with the preparation and delivery of a Preliminary Economic Assessment before 2019.
The Oro Property
The Oro property is located in southern New Mexico, approximately 80 km southwest of the Silver City porphyry copper district and lies within the prolific Laramide Porphyry Copper Belt of the southwestern USA. The property covers a highly prospective 6 square kilometer area of quartz-sericite-pyrite alteration, interpreted to overlie an unexposed porphyry center. Classic porphyry system zonation is indicated by surface gold and copper mineralization associated with Laramide-age intrusions in this core area, flanked by lead-zinc skarn mineralization and distal sediment-hosted gold occurrences.
From 2007-2011 and prior to the agreement with Desert Star, Southern Silver completed surface mapping and sampling, a 455 line-kilometre airborne magnetic survey over the entire property and 3,201 meters of diamond drilling which tested several skarn and carbonate replacement targets along the periphery of the porphyry target area. Exploration expenditures on the project during this time totalled approximately $1.25 million.
In addition to bulk tonnage porphyry copper-molybdenum-gold potential, the Oro Project claims also include the high-grade sediment-hosted Stock Pond gold target. Reconnaissance rock sampling has been completed over a strike length of 140 meters at Stock Pond, yielding values up to 4.8 g/t gold. Gold mineralization at Stock Pond is interpreted to be related to the main porphyry center, located 4 kilometers to the southwest.
Desert Star, optionor of the property, has advised that it intends to conduct a systematic exploration program on the Oro Project in 2013. The proposed 2013 exploration program includes detailed deep penetrating geophysical, surface mapping, sampling, trenching and diamond drilling to test both the porphyry potential on the property as well as the gold potential at Stock Pond. Exploration is expected to start in the coming months.
About Southern Silver Exploration Corp.
Southern Silver Exploration Corp. is a precious and base metal exploration and development company and a member of the Manex Resource Group; a private company comprised of an exceptional multi-disciplinary team of professionals with specific expertise in all areas of exploration, development, corporate finance and public company administration.
The company's growth strategy is to acquire, explore and develop either directly or through joint venture relationships high-quality mineral properties in progressive jurisdictions within North America including Southern Silver’s silver-lead-zinc Cerro Las Minitas project located in Durango, Mexico. Freeport-McMoRan Exploration Corporation currently holds an option to earn a 70% indirect interest in the project by making staged purchase payments and funding exploration and development expenditures of $25 million on the project over a ten year period.
Desert Star Resources Ltd. has the option to earn up to a 70% interest in the gold-silver-copper Oro project in New Mexico by making cash payments to underlying optionors, issuing one million shares, completing a preliminary economic assessment and incurring exploration expenditures of $6 million on the property over a period of 66 months. Southern Silver is currently advancing the porphyry copper-molybdenum Dragoon project in Arizona and the Minas de Ameca silver, lead-zinc project in Jalisco, Mexico.
Source: http://www.southernsilverexploration.com/