2015-02-27 20:46 ET - News Release
Also News Release (C-CDU) Cardero Resource Corp
Mr. Todd McMurray of Artha reports
Artha Resources Corp. has entered into negotiations with Cardero Resource Corp. in connection with a proposed arm's-length transaction, whereby Artha will acquire all of Cardero Resource Corp.'s interests in a wholly owned Argentine subsidiary, Cardero Argentina S.A., in exchange for common shares in the capital of Artha. Cardero Argentina's principal assets include the 100-per-cent-owned Organullo gold-silver project located in Salta province, Argentina, the 100-per-cent-owned former-producing Mina Angela gold-silver property located in Chubut province, southern Argentina, and an extensive proprietary exploration data set covering northwestern and west-central Argentina.
The effect of the transaction will be a reverse takeover of Artha by Cardero resulting in Cardero becoming a new control person of Artha, within the meaning of TSX Venture Exchange policies.
The transaction is subject to approval by the TSX-V and shareholders of Artha. Artha expects to hold a special annual and general meeting of shareholders on or about April 30, 2015, for the purpose of obtaining shareholder approval of the transaction. The transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all. Assuming the transaction is completed and approved, changes will be made to the current board of directors and management of Artha.
Artha expects to conduct a private placement offering in connection with the closing of the transaction in the approximate amount of $700,000, which will be directed toward exploration and resource definition at Organullo, as well as general working capital. Upon the closing of the transaction, Artha's material listing property will be the Organullo project.
Charles Straw, Artha's chief executive officer, commented, "I believe this transaction is a great opportunity for existing shareholders of Artha who will be exposed to two quality precious metals assets in Argentina, access to capital to move those projects forward and an extensive exploration database with which to generate new opportunities."
Organullo gold deposit
The Organullo project is a relatively advanced epithermal gold-silver project located close to infrastructure in the mining-friendly province of Salta, northwestern Argentina, with excellent potential for both high-sulphidation-type epithermal high-grade gold, as well as bulk-tonnage lower-grade gold mineralization.
Highlights from the property include:
- A total of 1,580 surface rock samples collected by previous explorers from an area of approximately eight kilometres by eight kilometres averaging 0.25 gram per tonne gold;
- Historical reverse circulation drilling highlights including 189 metres of 0.66 g/t gold and 200 metres of 0.66 g/t gold (both intersections from surface) in historical drilling prior to Cardero's ownership of the property;
- Diamond drilling highlights including 91.65 metres at 0.66 g/t gold;
- Cardero considering that historical exploration inadequately tested this large, pervasive gold-silver-bearing system;
- Gold values from 361 rock samples collected by Cardero over eight km of strike averaging 0.48 g/t gold and ranging from below detection to 29.7 g/t gold;
- Mapping and geochemical analyses conducted by Cardero defining a 2.1-kilometre-by-800-metre zone of hydrothermal alteration indicative of both low- and high-sulphidation-style epithermal gold deposits;
- Geophysical surveying conducted by Cardero characterized the historical Julio Verne mine and identified similar targets over a five-kilometre strike length.
The Fraser Institute Annual Survey of Mining Companies (2014) places Salta province second in all of South America in terms of its investment attractiveness index.
Artha considers the Organullo project to offer excellent drill-ready targets with a focus on delineating both large bulk-tonnage potential, as well as higher-grade zones.
Mina Angela gold deposit
Mina Angela is located in Chubut province in southern Argentina. The property was explored by several companies between 1951 and 1978, and production recommenced in 1978. The underground mine was operated by Cerro Castillo SA until 1992, producing more than 150,000 ounces of gold. The mineralized system remains open at depth. Government records from 1983 until the mine closed in 1992 show mining production was 1.04 million tonnes for this period with average grades of: 4.0 grams per tonne gold, 48.4 g/t silver, 2.0 per cent lead, 0.4 per cent copper and 4.6 per cent zinc. In 1996, Lonrho Mining Ltd. acquired equity in Cerro Castillo and conducted a detailed exploration program in 1997 and 1998, including 3,500 metres of drilling, which targeted anomalies identified using geophysics and soil geochemistry. Exploration by Lonrho in 1998 discovered a new vein system: the Sahuel prospect. Geophysics indicate the vein has a potential strike length of 1.6 kilometres. Significant drill intercepts include 1.36 metres of 40.65 g/t gold and two metres of 6.69 g/t gold. Lonrho estimated the downdip extension of ore at Mina Angela to extend for another 150 metres, at Mina Camila for about 250 metres and at Sahuel for 400 metres.
Cardero acquired the property in 2004 and entered into a joint venture with Hochschild Mining PLC in 2005. Hochschild entered into a feasibility study to restart mining, and as part of this process, it paid the final $350,000 option payment to secure 100 per cent. Hochschild withdrew in 2009 due to the global economic crisis.
Despite past production, the property remains largely underexplored. There is high potential for extension of ore reserves along the downdip extensions of the vein systems at Mina Angela, Mina Camila and the Sahuel prospects. There are several additional identified targets with the opportunity for new discoveries. The property is ideally located, with proximity to national transportation infrastructure.
The technical information in this news release has been reviewed and approved by Mr. Straw, BSc, a director and chief executive officer of the company, a qualified person for the purpose of National Instrument 43-101.
We seek Safe Harbor.