Property Description

The 100% owned Minasnioc Property consists of several contiguous concessions covering 7200 hectares. The Company initially acquired the Minasnioc Gold-Silver project in a closed-bid government auction on May 20, 2010. The project site is located in the department of Huancavelica, approximately 300 kilometres southeast of Lima. The project has seen previous intensive exploration campaigns by Barrick and Compañia de Minas Buenaventura S.A.C. between 2001 and 2007. The programs included surface channel sampling, geological mapping, geophysics and drilling.

At the end of 2017, the Company entered into an option agreement with IAMGOLD Peru S.A., a wholly owned subsidiary of Toronto and New York Stock Exchange-listed IAMGOLD Corporation. The Agreement between the companies is comprised of three options. On signing the Agreement IAMGOLD will pay Duran $50,000 US and will have until December 31, 2018 to secure access rights agreement with the local community and enter into the First Option period. Should IAMGOLD be unable to secure community access rights it can extend the period until December 31, 2019 by giving notice to Duran and by paying the Company an additional $50,000 US prior to January 4, 2019. Initial consultation with the local community has commenced and the Company is confident that a community agreement will be reached in 2018.

Upon securing the community agreement, IAMGOLD has the right to enter into the First Option to earn a 60% interest in the Property over a 4 year period. As a condition of the First Option IAMGOLD must carry out sufficient drilling to determine a resource estimate and issue a Preliminary Economic Assessment prepared in accordance with National Instrument 43-101 standards (the “PEA”) demonstrating a minimum gold resource of 300,000 ounces. During the term of the First Option IAMGOLD will be also required to make payments to Duran totalling $500,000 US as follows:

On entering First Option: $ 75,000
First Anniversary of entering the First Option $100,000
Second Anniversary of entering the First Option $100,000
Third Anniversary of entering the First Option $100,000
Fourth Anniversary of entering the First Option $125,000

The Second Option will allow IAMGOLD to earn an additional 10% (total of 70%) in the Property over 4 years by completing a prefeasibility study in accordance with NI 43-101 standards (the “PFS”). The PFS must have a Measured and Indicated Resource of at least 1 million ounces of gold. Should IAMGOLD fail to produce the PFS as specified above it will still maintain its 60% interest in the Property.

Within 10 days of IAMGOLD vesting in Second Option if Duran requests, and IAMGOLD agrees, IAMGOLD will enter a Third Option in which it can increase its ownership in the Property to 75% (the “Third Option”) by arranging financing for Duran’s 25% share of exploration, feasibility and mine development and construction costs. The financing will be done at Libor plus 8%.

Location Map


Initially, the property consisted of a single 1,000 hectares concession covering the area of the previous drilling. In April 2012, Duran expanded the land position to cover 3,800 hectares by applying for an additional property and purchasing three contiguous concessions from Barrick Gold. In addition, the Company acquired the complete data set from Barrick’s previous work. The data included detail assay and geological information for all forty holes (5863 metres in total) drilled during 2003 and 2004. The consideration paid to Barrick Gold for the data and concessions was 1 million shares of Duran and a 2% NSR on the three concessions. Franco Nevada is the current owner of the 2% NSR. The Company acquired an additional 4100 hectares in November 2014 and January 2015. The original 1000 hectare concession held by Duran and recently acquired concessions by application are not subjected to any royalty with the exception of the royalty paid to the government based on revenues.

Property Map



Property visits and limited mapping by the Company’s geologists confirmed the presence of a high-sulphidation (acid sulphate) epithermal gold- and silver-bearing system developed in Tertiary volcanic rocks. Extensive zones of argillic and advanced argillic alteration are present with areas of massive and vuggy silica and associated alunite. The gold-silver-bearing part of the epithermal alteration system covers an area of two kilometres by two kilometres. Several gold anomalies exist outside the drilled area that require further mapping and sampling to define drill targets.

Alteration and Drill Hole Location Map


The previous drilling discovered two distinct mineralized zones. The north zone shows disseminated Au-Ag mineralization over a 1200 metres east-west trend with several significant intersections starting at surface. The near surface mineralization appears to be open to the west and southwest as historic drill holes P-02 and P-07 intersected respectively; 55.78 metres of 0.55 g/t Au from surface and 61.40 metres of 0.51 g/t Au starting at 5.65 metres. Within the mineralized zone, high grade intercepts include drill hole P-16, located on the eastern portion, returning 1.15 g/t Au and 9.70 g/t Ag over 17.70 metres starting at 28.55 metre depth, and P-23 returning 1.24 g/t Au and 13.9 g/t Ag over 47 metres starting at a depth of 142.9 metre depth. It must be noted that the drill results are historical in nature and therefore are not 43-101 compliant and cannot be relied on.

Drill Intercept Highlights, Litholgy, and Gold in Till and Rock Geochemistry


The second mineralized zone is located some 2,000 metres south of the main zone and intersected a silver rich zone with hole P-17 returning 57.8 meters of 63.3 g/t Ag starting at 5.2 metres. Silver zones depleted in gold in these high sulphidation systems normally represents the higher parts of the hydrothermal system indicating a strong a possibility of a buried gold rich zone at depth.

The volcanic host rocks are Tertiary in age and the style of mineralization is similar to Barrick's Pierina and Alto Chicama mines and Newmont and Buenaventura's Yanacocha mine in Peru. Other notable and comparable high sulphidation oxide gold properties in Southern Peru include Pan American’s Pico Machay Property, Minera IRL’s Corihuami and Aruntani’s Arasi Properties. It is important to note that the style of the near surface, oxide gold mineralization allows for low cost extraction. For example Minera IRL’s Corihurami Mine located approximately 160 kilometers North of Minasnioc along the same geological belt produced 33,013 ounces of gold at an average of 0.87 g/t Au during 2010 at cash costs of $383 per ounce. The Corihuami gold mine was placed in production in 2008 for a capital cost of US$20 million and continues to be in production. The Corihurami capital cost was recovered from pre-tax cash flow within the first 7 months of production.

(source: http://www.minera-irl.com/english/Mine/Corihuarmi/tabid/135/Default.aspx)