(MENAFN- ProactiveInvestors - Australia) Oakland Resources (ASX: OKL) has inked an implementation agreement to acquire unlisted Chilean copper explorer Castillo Copper in an all scrip transaction.
The company will acquire all of the issued capital in Castillo via the issue of one Oakland share for every Castillo share held.
Total consideration will be the issue of just over 50 million Oakland shares, which were last trading at A$0.042 valuing the transaction at around $2.1 million.
Castillo owns three under-explored Chilean properties in porphyry copper and copper iron trends, which are host to numerous substantial producing mines, and one copper prospect.
Chile projects
The first project, Posada, is an iron oxide copper gold (IOCG) project in the copper-iron belt of the productive Atacama Fault Zone in Northern Chile.
The Atacama Fault Zone host to several major Chilean copper mines.
These include Candelaria, which has Probable and Possible Ore Reserves of 339 million tonnes at 0.58% copper and 0.13 grams per tonne (g/t) gold and Mantoverde, which has a Measured and Indicated Resource of 34.2 million tonnes at 0.38% copper oxide plus 114 million tonnes at 0.66% copper sulphide.
Between them these two mines produced 233,333 tonnes of copper and 101,000 ounces of gold in 2011.
The Posada Project covers 7,700 hectares of exploration tenements and IOCG style copper mineralisation has been identified in strata and hydrothermal breccias.
A geophysical anomaly showing a well-defined chargeability anomaly has been identified for immediate drilling.
Castillo Copper's exploration target is initially 1 to 3 million tonnes of copper hosted by mineralisation ranging from 100 to 300 million tonnes at 1% to 1.5% copper.
The second project, Rio Rocin, focuses on porphyry-style copper-molybdenum mineralisation and is located about 150 kilometres north of Santiago in the highly productive Central Zone of Chile.
This Central Zone is host to a major porphyry copper belt and some of the world's largest producing copper deposits including the 5.8 billion tonne El Teniente, the 1.1 billion tonne Rio Blanco, comprising Los Bronces, the 4.8 billion tonne Andina, and the 1.6 billion tonne Los Pelambres.
These mines collectively produced 1.27 million tonnes of copper in 2011.
The Rio Rocin project covers 2,200 hectares of mining tenements.
Porphyry copper style alteration has been identified, including leached lithocap with relict sulphides, stockwork and tourmaline hydrothermal breccias.
The immediate drill target is high grade secondary sulphide mineralisation under the lithocap surrounded by a 2 by 5 kilometre phyllic zone.
Castillo Copper's exploration target is 4 to 8 million tonnes of copper hosted by mineralisation ranging 500 million to 1 billion tonnes at 0.8 to 1% copper.
The third project, Resguardo, occurs on the flanks of Cerro Fraga, north east of Copiapó.
It comprises 1,843 hectares of exploration tenements which include a closed underground copper mine.
The latter has provided good exposure to the mineralisation and alteration, which appear to be consistent with a copper-mineralised hydrothermal breccia associated with a porphyry copper deposit.
Regionally the deposit may be related to the Middle Tertiary porphyry copper belt that hosts the Salvador and Potrerillos copper mines.
The current Measured and Indicated Resource of Salvador was reported at 1.2 billion tonnes at 0.49% copper, and produced 69,046 tonnes of copper in 2011.
Copper mineralised hydrothermal breccias have been identified at the Resguardo project, with grades in old workings in the order of 2% copper.
The immediate drill target is high grade sulphide mineralisation of the breccia zone.
Castillo Copper's exploration target is 500,000 to 1 million tonnes of copper hosted by mineralisation ranging 50 to 100 million tonnes at 1% copper.
Lastly, the Quebrada Huanta porphyry copper-gold prospect near La Serena in Central Chile.
It is a series of exploration concessions covering an area of 5,000 hectares inland from La Serena and near the exhausted El Indio copper-gold mine.
It is a grass-roots project targeting porphyry copper-gold mineralisation in an underexplored area.
Porphyry copper-gold style alteration has been confirmed on third party property (Rinconada) adjacent to Castillo's tenements.
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