Orogen holds 1.5% NSR royalty
Owned by First Majestic Silver Corp.
First Majestic Silver Corp. completed its 100% earn-in for the Cumobabi project in September 2018, with US$1.5 million cash payment for a net smelter return (“NSR”) royalty for both Ermitaño (2% NSR) and Cumobabi (1.5% NSR) projects. During the option agreement, First Majestic paid US$75,000 upon signing the Agreement and US$50,000 each anniversary thereafter, completing over US$500,000 in exploration expenditures in the first year, and delivering a Production Notice specifying mine and construction plans with accompanying permits.
About the project
Cumobabi consists of 240 square kilometres of contiguous mineral tenure located 130 kilometres north east of Hermosillo, the capital of Sonora State, Mexico, and only 60 kilometres south west of the smelter at Nacozari. Access to the project is by highway and secondary roads.
Cumobabi covers the majority of the Cumobabi breccia district and surrounds the past producing Cumobabi mine. Geology underlying the project consists of Cretaceous andesite volcanic centres intruded by Laramide age equivalent intrusive rocks including granodiorite and quartz-feldspar porphyries, Cu porphyry, Cu-Ag breccia pipes and Au-Ag epithermal veins.
El Chileno Target - Located on the northern boundary of the past producing Cumobabi mine, El Chileno is characterized by an extensive kilometre scale phyllic alteration halo with local potassic alteration of a quartz feldspar porphyry. Limited drilling by Kennecott returned 38 metres grading 0.14% copper from within the potassic zone. The target remains untested by drilling to the north.
Jurahui Target - Covers a significant 10 square kilometre area of coincident copper and molybdenum in stream sediment geochemistry, magnetic low signature and clay/iron oxide alteration as interpreted from satellite imagery. Limited surface mapping has delineated large areas of strong argillic and phyllic alteration in the area along with significant limonite stockworking. Before Orogen’s exploration with partner First Quantum, the area had seen no systematic exploration including soil sampling, rock sampling, mapping, geophysical surveys or drilling.
Portreritos - An example of a recent breccia discovery within the district and is located at the southeast end of the Jurahui target. Here Cu and Ag mineralization is associated with quartz tournmaline breccia developed within phyllic and potassically altered granodiorite. Drill results include: 26 metres of 0.55% copper, 4 g/t silver and 9.15 metres @ 2.65% copper and 21 g/t silver.
Large portions of the property have not seen systematic exploration despite evidence of porphyry mineralization and alteration at El Chileno and Jurahui. Cumobabi consists of a dominant ground position in a proven porphyry and breccia district.
The exploration at Cumobabi in 2011 consisted of a property wide reconnaissance program aimed at identifying targets and/or areas for drill testing. Exploration in 2011 consisted of mapping, geochemical sampling and ZTEM geophysics over the entire 407 square kilometre property.
The 2012 exploration program consisted of approximately 100 line-kilometres of pole-dipole Induced Polarization geophysics in conjunction with detailed geological mapping to define new drill targets and refine drill targets previously identified in the 2011 program. Compiled data was analyzed to determine which drill targets warrant testing in 2013.
In 2013 Orogen and former exploration partner FQM ( Akubra ) Inc. (“FQM”) completed five widely-spaced drill holes totaling 2,943 metres. The program at Cumobabi tested geological, geochemical and geophysical targets generated by the 2012 exploration program. The program also comprised additional IP surveying totaling 38 line-kilometres in two blocks northeast and northwest of the 2012 survey.
* Cumobabi royalty subject to underlying agreement where Orogen retains 1.5% NSR on first 2 years of production and 1% thereafter.