Inca Minerals Limited

Inca is undertaking a maiden drilling campaign at its Riqueza Zn-Ag-Pb project in Peru. The campaign comprises 48 holes and 14,000 metres of drilling, which can be extended to 16,800m automatically under the conditions of the granted DIA drill permit.

Some Key Take-Aways

  • Greater than 100 individual Zn-Ag-Pb-(Au) occurrence at Riqueza.

  • Circa 50% of all surface samples at Riqueza averages 13% Zn, 311g/t Ag, 16% Pb.

  • Riqueza appears to be an intrusive-related replacement deposit – just like 3 mined deposits less than 25km away.

  • Chinese smelter interests have taken up a cornerstone interest in Inca.

  • One of the largest resource funds in the world, RCF, remains a cornerstone investor.

  • BHP have taken a ground position adjacent to Inca.

  • The SP has experienced a more than 500% increase – pre-drilling.

  • Zinc prices continue to out-perform other metals as production is squeezed and warehouse levels fall.

  • AND... DRILLING GOES LIVE! …So expect steady news flow.

Inca Minerals Managing Director, Mr Ross Brown said “It is very exciting now to be drilling at Riqueza. Since April 2016, when we announced the acquisition of Riqueza, we have discovered over 100 new occurrences of Zn-Ag-Pb mineralisation at Riqueza, including new structures, numerous veins, mantos and breccias. Essentially we have changed Riqueza from a small project into a large project and in the meantime obtained a 14,000m drill permit.”

“… over 100 new occurrences of Zn-Ag-Pb mineralisation at Riqueza.”

There are now four highly prospective areas at Riqueza, the Humaspunco Prospect (“Humaspunco”), the Humaspunco South Prospect (“Humaspunco South”), the Pinta Prospect (or “Pinta”) 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 mapping and sampling has established the bona fides of these areas. Inca has collated this data and has recognised the very high potential of these prospects and areas surrounding them.

Humaspunco

Humaspunco is the largest prospect at Riqueza. Extending over an approximate area of 1,200m x 800m, it hosts innumerable minerals veins, mantos and breccias. Pinta and Humaspunco South satellite Humaspunco. Pinta hosts the same types of Zn-Ag-Pb bearing veins and mantos as at Humaspunco and is likely to be an eastern extension. Humaspunco South is a newly described prospect that hosts Zn-Ag-Pb bearing manto mineralisation that is open-ended to the south. Uchpanga, some 2.5km south of Humaspunco, host a 750m gossan containing Zn-Ag-Pb-Au mineralisation.

The Humaspunco Prospect largely corresponds to a large hill bearing the same name. Pinta is just off frame to the right and Humaspunco South is in the foreground, roughly corresponding to where the track is. Humaspunco Hill is shaped like a wedge in cross-section, shallow side facing south, steep side facing north.

It is believed that the greater Humaspunco area (Humaspunco, Pinta and Humaspunco South) hosts a replacement Zn-Ag-Pb deposit and Uchpanga a hydrothermal Zn-Ag-Pb-Au vein (or dyke) deposit. Both are believed genetically and possibly spatially associated and to be part of the same large intrusive-replacement mineralised system.

There are three mines within 25km of Riqueza that are intrusive-replacement deposits, Corihuarmi, Bethanja and Heraldos Negros. This supports the possibility that Riqueza is an intrusive-replacement deposit. These mines, including Riqueza, are aligned in a NW-SE mineral belt, a further strong indication that the deposits have similar provenance.

Inca’s exploration focus is on the discovery and delineation of economically important high grade Zn-Ag-Pb deposits in Peru?with special emphasis on Zn. The Riqueza Project , as well as the Cerro Rayas Project, both contain high grade Zn-Ag-Pb mineralisation and have substantial upside potential.

Inca’s Purpose

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 Projects

Inca’s exploration focus is on the discovery and delineation of economically important high grade Zn-Ag-Pb deposits in Peru, with special emphasis on Zn. The Riqueza Project , as well as the Cerro Rayas Project, both contain high grade Zn-Ag-Pb mineralisation and have substantial upside potential.

Peru

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 copper and 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.

Inca’s People

Inca has built a passionate team of Perth and Peru based professionals. Our Peru-based team comprises leaders in geological interpretation, exploration planning and execution, social, community and environmental management. Our Perth-based management adhere to the highest standards of corporate governance and compliancy regulations. It is worth highlighting that our three-person board is un-changed since early 2012.

Inca’s Performance

In a crowded junior resource sector, Inca discerns itself by its projects, its people and its performance. “It’s the 3-P’s” says Mr Brown. “Add Peru and persistence – it becomes the 5-P’s. We’ve been operating in Peru now since 2011 (pre-listed and listed status). We’ve seen companies come and go. We are still here. Why? Well that’s simple. Peru is full of metal. It scores highly in global production in Ag, Cu, Zn, Pb and Au. It scores highly in global exploration spend. We consider Peru a place where mineral discoveries are possible and indeed likely.

At Chanape we discovered a large porphyry system. We boldly said we would and we did. We drilled the property ticking off all the targets. World expert opinion based on the sum total of all our work concluded that the Cu part of the porphyry was beyond economic exploitation. Failing to rejig the exercise price with the vendor meant that was no value for shareholders hanging about – so we moved on. “Not a hole too few not a hole too many.”

“Not a hole too few – not a hole too many.” [At Chanape]

Move on 12 months to the current time, we have commenced maiden drilling at the Riqueza Zn-Ag-Pb-(Au) Project. We had a 525% increase in our share price and our market-cap has moved from <$2.2M to >$50M.

Some Key Take-Aways

  • Greater than 100 individual Zn-Ag-Pb-(Au) occurrence at Riqueza.

  • Circa 50% of all surface samples at Riqueza averages 13% Zn, 311g/t Ag, 16% Pb.

  • Riqueza appears to be an intrusive-related replacement deposit – just like 3 mined deposits less than 25km away.

  • Chinese smelter interests have taken up a cornerstone interest in Inca.

  • One of the largest resource funds in the world, RCF, remains a cornerstone investor.

  • BHP have taken a ground position adjacent to Inca.

  • The SP has experienced a more than 500% increase – pre-drilling.

  • Zinc prices continue to out-perform other metals as production is squeezed and warehouse levels fall.

  • AND... DRILLING GOES LIVE! …So expect steady news flow.

What’s Next

“We’ve had two +10-baggers since operating in Peru” says Mr Brown. “The first came about after DDH-001 at Chanape, drilling into a porphyry for the first time. The second came about through sustained success as Riqueza?more and more occurrences of strong mineralisation. Now drilling starts again!”