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Inca has made a very significant and exciting change in direction. We have acquired the rich zinc (Zn), silver (Ag) and lead (Pb) Riqueza Project and we have dropped the Chanape Project. Whilst it was painful to walk away from our own porphyry discovery at Chanape; it was ultimately a relatively easy decision and based simply on Chanape’s down-graded potential. If present, the copper (Cu) part of the porphyry was going to be too deep. Attempts to renegotiate the earn-in deal had also failed.
Inca Minerals Managing Director, Mr Ross Brown said “You don’t bank technical discoveries, you bank grade. And strong grade is what we have at Riqueza - our new zinc-focussed project in Peru.”
“… strong grade is what we have at Riqueza.”
There are least two highly prospective areas at Riqueza, the Humaspunco Prospect (or “Humaspunco”) and the Uchpanga Prospect (or “Uchpanga”). These prospects were the focus of small scale mining last century and host significant concentrations of strong Zn-Ag-Pb mineralisation. Results of several phases of surface sampling has established the bona fides of the two areas. Inca has collated this sample data and has recognised the very high potential of these prospects and areas surrounding them.
The Humaspunco Prospect hosts 12 veins (10 of which are sampled) and 3 mantos (previously mapped as a single manto). Two of the veins are believed to be feeder-zones. Extensions of the veins are likely to the west and at depth. Extensions of the mantos are likely to the west and south. A 700m x 500m +1% Zn soil anomaly corresponds to and extends significantly from the known veins and mantos.
· Four veins (recorded in pre-2011 programmes):
- 12.41% Zn, 373.75g/t Ag and 11.97% Pb.
- 8.21% Zn, 220.31g/t Ag and 13.91% Pb.
- 4.24% Zn, 135.94g/t Ag and 4.74% Pb.
- 7.49% Zn, 259.85g/t Ag and 14.29% Pb.
· Six additional veins and manto sampled in a 2011 programme (262 samples) averaging 7.18% Zn, 205.36g/t Ag and 10.71% Pb.
The Humaspunco Prospect occurs at the top and southern side of a hill with the same name.
The Uchpanga Prospect hosts 1 dyke, 1 manto and a 600m long gossan (weathered massive to semi-massive sulphide horizon). The dyke, which is 7m wide, is believed to be a feeder-zone. The manto is 12m thick and, as such, is the widest known to date at Riqueza. The gossan most likely represents an extension of the manto.
· Dyke (recorded in pre-2011 programmes) at 6.94% Zn, 94.97g/t Ag and 8.77% Pb.
· Manto sampling – data not available.
The satellite image below shows the Humaspunco Prospect on top the hill. The hill gently slopes to the south. The line of sight is obliquely across the prospect to the SE. The mineralised veins are shown as red and white lines. There are many surface indications of new veins or extensions of veins. Only some are shown in this diagram (as yellow lines). Light and dark grey limestone bedding is evident on the north face of the hill. The mineralised mantos at Humaspunco form layers parallel to this bedding and therefore dips gently to the south just below the surface.
The Humaspunco Project at Riqueza showing the location of the mineralised veins.
It is the intention of Inca to develop its Riqueza Project (and other Zn projects it has and may acquire) using best practice exploration methods with the “end-game” of defining an economic resource and commencing exploitation. With respect to Riqueza, we believe an Exploration Target (JORC 2012 Chapter 17-19) can be achieved with phase 1 drilling. We also believe a mineral resource (JORC 2012) can be achieved within a 2 to 5 year time frame.
“Multiple high grade veins and mantos that stick out of the ground, both in the figurative and literal sense, are a far cry from mineralisation reachable with 1,000m deep holes” Mr Brown says reflecting on the exploration demands of Chanape. “Whilst resource building was difficult at Chanape, we feel the same will not be true at Riqueza.”
The company continues to strive for exploration excellence and to maximise shareholder value through discovery and development. “We will not shirk from difficult decisions, nor take for granted shareholder support. We adhere to foundation best practise principles in exploration, social and environment management.”
Inca’s exploration focus is on the discovery and delineation of economically important high grade polymetallic deposits in Peru, with special emphasis on Zn. This is a deliberate departure from porphyry exploration that, albeit believed us a “technical discovery” is not sustainable in a climate of generally poor commodity prices and tightening global exploration expenditure.
The Riqueza Project is in fact our second zinc-focussed project in Peru, the first is Cerro Rayas. These projects contain high grade Zn-Ag-Pb mineralisation and have substantial upside potential. Riqueza is highlighted at the top of the Home Page (above) and both are discussed in further detail below and under Projects – Peru.
Inca also has the Moquegua Regional Project in southern Peru and Dingo Range Ni Project in Western Australia. Regarding the latter the non-nickel rights have been sold to a (currently) unlisted Australian gold explorer.
The Riqueza Project is a gem of a project, unique in the opportunity it represents as being at an early stage of development yet with numerous high grade Zn-Ag-Pb occurrences. It has never been drilled yet mineralisation festoons the surface. Perhaps it is because mineralisation is at the surface that previous owners sought to exploit the deposit rather than define it. “Not all together a misguided strategy for some, Inca is planning to do both; define and mine Riqueza” says Mr. Brown.
“Defining and Mining at Riqueza”
The concessions comprising the Riqueza Project with geology.
The property comprises the centrally located Nueva Santa Rita concession (1,000ha) and four surrounding new concessions, Antacocha (1,300ha), Rita Maria (500ha), Uchpanga (1,000ha) and Picuy (800ha). As at May 2016 these were applications. The Company has signed an option to acquire the Nueva Santa Rita concession by way of a 5 year Mining Option and Assignment Agreement with the concession holder. The total consideration for 100% of the project (less 2% NSR) is US$1,773,000. The new concessions are 100% owned by Inca.
As described above Riqueza hosts two prospects called Humaspuco and Uchpanga. Both prospects were subject to small scale mining between the 1950’s and 1980’s. Between 1983 and 2011 the vicinity around the mine workings was mapped and sampled. A total of approximately 380 samples were collected in this time.
The result of mapping and sampling is definitive, that widespread, numerous, high grade Zn-Ag-Pb veins and mantos occur at Riqueza. The diagram below shows a schematic NS cross section across the project area that shows the general geological “lay of the land” and importantly, a representation of the known mineralisation and possible mineralisation.
The cross section shows the position of the Uchpanga Prospect (in the south of the project) and the Humaspunco Prospect (in the north). In-diagram text lists all known occurrences of mineralisation. It shows the juxtaposition between the mineralised veins (vertical planar bodies) and the mineralised mantos (flat planar bodies). Feeder zones are drawn to greater depths to show that they represent the mineralised nexus (or conduit) between the veins and manto at the surface and the source of heat and metals at depth.
The company believes that the Zn-Ag-Pb mineralisation at Riqueza is characteristic of a Polymetallic Replacement Style Deposit. Other such style deposits occur within the Zn-Cu Skarn and Epithermal Au-Ag mineral belts of Central Peru.
Inca acquired Cerro Rayas in 2015. It is located 15km NE of Riqueza. It hosts three groups of old mine workings called Wari, Torrepata and Vilapuqueo. Zn-Pb-Ag mineralisation at Cerro Rayas is associated with replacement-veins within brecciated carbonate host rocks. The style of mineralisation is very similar to Riqueza.
As part of its due diligence Inca undertook a sampling programme to confirm the mineralisation at the Wari and Torrepata mine workings. The Wari Mine is the largest of the three workings at Cerro Rayas. Numerous drives provide access to a zone of mineralisation up to 5m in true width. Peak values from Inca’s rock chip sample programme include: M184109: 41.59 % Zn and 0.42% Pb. Mineralisation at Torrepata occurs as a near-massive sulphide vein up to 2m across: M184112: 32.07 % Zn and 20.19% Pb and 349g/t Ag.
Rock sample of the principal vein mined at Torrepata Mine showing zinc and lead sulphides. The sample returned 32.07 % Zn and 20.19% Pb and 349g/t Ag
The Moquegua Regional Project is an inactive project located in southern Peru. The project comprises several groups of concessions close to known Cu-Mo porphyry deposits and in this respect makes Moquegua prospective for similar styled mineralisation. They are considered very early stage exploration projects and collectively represent a substantial strategic land holding for the company.
Peru plays a major role in the global zinc market. It hosts a number of top 20 global zinc mines, produces the third highest amount of zinc in the world (after China and Australia) and has the third largest Zn reserve in the world (after Australia and China). Antamina (in Peru) is the sixth largest zinc mine in the world and is owned by BHP-Billiton, Xstrata, Teck and Mitsubishi.
Peru’s exports reached a total of $41.2 billion at the end of 2013. Its main exports were zinc, along with other minerals such as copperand gold. These mining exports accounted for 55.2% of the country’s economic exports. The mining industry accounts for 24% of Peru’s foreign investment. It is estimated that the current value of mining investments in Peru totals around $10 billion.
POLYMETALLIC REPLACEMENT DEPOSITS
The descriptive model of Polymetallic Replacement Deposits is copied and pasted from USGS Bulletin 1693 (1986). Many of the attributes described below are apparent at Riqueza.