The El Secreto Gold-Silver-Copper Project ("El SEcreto", the "Project") consists of three mineral concessions encompassing over 12,675 hectares (49 square miles) and is located approximately 100 kilometres north-east of Mazatlan, Sinaloa State. The geology and mineralization obtained to date suggests that El Secreto is highly prospective for the discovery of epithermal vein systems.
Camino recently completed a 1921.5 metre reverse circulation drill program at El Secreto (see news release dated January 18, 2013). This was the first ever drill program to be carried out at El Secreto and resulted in the discovery of five mineralized vein systems. Drilling was directed to a number of northeast-trending epithermal veins in two target areas, the Carrizal Area and the El Secreto Zone. Hole SE-12-001, located in the Carrizal Area, returned 84 metres of 0.33 g/t Au and 6.5 g/t Ag, including 30 metres of 0.58 g/t Au and 11.1 g/t Ag. Hole SE-12-003, located approximately 1.5 km southwest of hole SE-12-001 and also located in the Carrizal Area, returned 19.5 metres of 0.34 g/t Au and 21.5 g/t Ag. Hole SE-12-003 is interpreted to be a different vein from the one intercepted in hole SE-12-001. Drilling at the El Secreto Zone targeted three major sub east-west structures, with six of the seven holes intersecting anomalous gold values.
Sharing the same mineralized system, a distance of six kilometres separates the El Secreto Zone and the Carrizal Area. Similar mineralization and alteration (silicification, arsenopyrite and scorodite) can be observed at both target areas. This large system is over 9 kilometres in length, sub east-west trending, and up to 4 kilometres wide, north to south. This is comparable in size to the San Dimas District, located 40 kilometres northeast.
In addition to the geological-mineralogical footprint of the system, the anomalous gold and silver mineralized horizons intersected are highly anomalous in arsenic and antimony. In a paper written by Erme Enriquez, 1995, titled Trace Element Zonation and Temperature Controls of the Tayoltita Ag-Au Hydrothermal System, San Dimas District, Durango, Mexico, high arsenic and antimony values are found above the "Favourable Zone", which hosts all of the deposits at San Dimas. The Company believes that this mineralization is situated high in a mineral system and that high-grade stockwork zones and ore shoots, similar to the mineralization at San Dimas, may exist at depth. Camino plans to diamond drill test these targets in the near future.
El Secreto is situated along the western edge of the Sierra Madre Occidental in a structural setting similar to Primero Mining Corporation's San Dimas Mine, located 40-km to the east. San Dimas produced 111,130 gold equivalent ounces in 2012. Primero recently announced plans (see Primero's news release dated October 15, 2012) to increase mine throughput from the current 1,925 tonnes per day to 2,500 tonnes per day by the end of the first quarter of 2014. This expansion will allow for an average production target of 160,000 gold equivalent ounces per year over the next five years. The San Dimas district, which has been mined since 1757, contains a series of epithermal gold-silver veins. Historical production from the San Dimas district is estimated at 11 million ounces of gold and 582 million ounces of silver.
The consideration payable by Camino in order to acquire up to a 60% interest in the Project from Arcelia Gold Corp. ("Arcelia"), a private BC company, will consist of total cash payments of USD$200,000, the issuance of 2,000,000 Camino common shares and incurring exploration expenditures in the amount of USD$4,000,000 over a four year period, as more particularly described in the tables below (the "First Option"). The cash portion will be paid in five installments with the first payment having been made by Camino on February 21, 2012.
In addition to the First Option outlined above, Camino has also been granted the sole and exclusive right and option to earn and acquire an additional 10% undivided interest in the Project (the "Second Option"). If Camino wishes to exercise the Second Option, it must give written notice to Arcelia (the "Second Option Election") to this effect within 90 days of having exercised the First Option and complete, at its cost, a National Instrument 43-101 Standards for Disclosure for Mineral Projects ("NI 43-101") compliant resource estimate and a Preliminary Economic Assessment (as such term is defined in NI 43-101) within two (2) years of the "Second Option Election".
In addition to the First Option and Second Option, Camino has also been granted the sole and exclusive right and option to earn and acquire an additional 10% undivided interest in the Project (the "Third Option"). If Camino wishes to exercise the Third Option, it must give written notice to Arcelia (the "Third Option Election") to this effect within 90 days after the date that Camino has exercised the Second Option and complete, at its cost, a NI 43-101 compliant feasibility study with respect to placing the Project into commercial production within four (4) years of "Third Option Election".
Upon exercising its First Option (or Second Option or Third Option, as applicable), the Company and Arcelia will enter into a joint venture agreement to further explore and evaluate the Project. Arcelia will retain a net smelter royalty of 2% in the Property. Camino will be able to reduce the net smelter royalty to 1% by making a USD$1,500,000 cash payment to Arcelia.
Maps & Photos