Fenix Geoconsult Ltd.
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Item 1: Summary ....................................................................................................................................... 4
Item 2: Introduction ................................................................................................................................... 4
Item 3: Reliance on Other Experts ............................................................................................................ 5
Item 4: Project Description and Location.................................................................................................. 6
Item 5: Accessibility, Climate, Vegetation, Local Resources, Infrastructure, and Physiography............. 7
Accessibility and Physiography ............................................................................................................ 7
Climate and Vegetation ......................................................................................................................... 9
Infrastructure and Local Resources ..................................................................................................... 10
Item 6: History......................................................................................................................................... 11
Item 7: Geological Setting and Mineralization ....................................................................................... 12
Regional Geology ............................................................................................................................... 12
Mesozoic Era .................................................................................................................................. 14
Cenozoic Era ................................................................................................................................... 16
Local Geology ..................................................................................................................................... 19
Structural Geology .............................................................................................................................. 21
Item 8: Deposit Types ............................................................................................................................. 24
Paleoplacers ........................................................................................................................................ 24
Vein Type ............................................................................................................................................ 28
Modern Placers ................................................................................................................................... 31
Mineralization ..................................................................................................................................... 34
Item 9: Exploration .................................................................................................................................. 35
Item 10: Drilling ...................................................................................................................................... 40
Item 11: Sample Preparation, Analyses, and Security ............................................................................ 41
Item 12: Data Verification ....................................................................................................................... 42
Item 13: Mineral processing and Metallurgical testing ........................................................................... 43
Item 14: Mineral Resource estimates ...................................................................................................... 44
Item 15: Mineral Reserve Estimates ....................................................................................................... 45
Item 16: Mining methods ........................................................................................................................ 46
Item 17: Recovery methods .................................................................................................................... 47
Item 18: Project Infraestructure ............................................................................................................... 48
Item 19: Market Studies and Contracts ................................................................................................... 49
Item 20: Environmental Studies, Permitting and Social or Community Impact..................................... 50
Item 21: Capital and Operating Costs ..................................................................................................... 51
Item 22: Economic Analysis ................................................................................................................... 52
Item 23: Adjacent Properties ................................................................................................................... 53
Item 24: Other Relevant Data and Information ....................................................................................... 54
Item 25: Interpretation and Conclusions ................................................................................................. 55
Item 26: Recommendations .................................................................................................................... 56
Proposed Budget ................................................................................................................................. 56
Item 27: References ................................................................................................................................. 58
Date and Signature Page ......................................................................................................................... 60
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Figure 1. Current applications in the area of Rionegro. ........................................................................... 6
Figure 2. Wooden bridges at some sections of the road to the target. ....................................................... 8
Figure 3. Horts/Graben relief at Rionegro target. ...................................................................................... 9
Figure 4. Regional geology of the Rionegro area. .................................................................................. 12
Figure 5. Limestone-rich conglomerate from Rionegro license. ............................................................. 13
Figure 6. Black shales of the Simití formation in the Rionegro project. ................................................. 14
Figure 7. Elliptical concretions of limestone of the Salada member of the Luna Fm. in the Rionegro license. ..................................................................................................................................................... 14
Figure 8. Ammonites of the Galermo member of the La Luna formation. ............................................. 15
Figure 9. Coal bed in a carbon-rich shales.............................................................................................. 15
Figure 10. Lisama formation in the Rionegro license. ............................................................................ 16
Figure 11. La Mesa Formation, Inferior member (Ymi) in the Rionegro license. .................................. 17
Figure 12. Thick colluvial deposits in the Rionegro license. .................................................................. 18
Figure 13. Wide alluvial deposits in the Rionegro license. ..................................................................... 18
Figure 14. Alluvial profile at Rionegro. .................................................................................................. 19
Figure 15. Oxidized acid water draining from the tonalite intrusive. ...................................................... 20
Figure 16. A silica cap from the Rionegro license. ................................................................................. 20
Figure 17. Location of the Horst/Graben structure at Rionegro. ............. ¡Error! Marcador no definido.
Figure 18. Lineament analysis in the Rionegro area. .............................................................................. 23
Figure 20. Gold grains in a heavy mineral concentrate from the Lebrija River. ..................................... 34
Figure 21. A Colombian Company is currently exploiting one placer in the Lebrija River. .................. 53
Figure 22. GPR image. ............................................................................................................................ 56
Table 1. Licenses of the Client in Colombia. ............................................................................................ 6
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Alicanto Mining Corp through his fully owned Colombian Company Alicanto Colombia
SAS, has applied for two large licenses in the Rionegro area, Northwest of Bucaramanga, encompassing placer alluvial of the main river (Lebrija). Besides the known placers in the river, there is a clear potential for paleoplacers as well as the main source of gold associated to a sequence of pre Carboniferous conglomerates, in a geological environment very similar to the South African Witwatersrand. There is also the potential for a carlin type of mineralization in the area.
The idea is to start the exploitation of the known placers using advance techniques after locating the most productive areas. Parallel to this, we will study the paleoplacers using a combination of GPR
1
, pitting, and soil geochemistry and the original source of gold in the conglomerates using the FG csa
™ 2
.
An exploration budget of US$1,000,000 is proposed to explore and develop this target.
As part of the current investigation a report has been prepared by P. Geo. Ricardo Valls of Fenix Geoconsult Ltd to present an update on the potential of the Rionegro area in
Colombia.
The author has repeatedly visited the project since the Discovery in March of 2014 and is very well familiar with the geology of Colombia and has previous experience in similar environments.
The author used data and information from existing public sources and other information presented by local workers in the area.
All coordinates in this report correspond to the WGS 84 datum.
We have adhered to the metric system and all costs are expressed in US dollars at a conversion rate of 2,383 Colombian pesos and 1.251 Canadian dollars 3 .
1 GPR stands for Ground Penetration Radar (http://www.groundradar.com/)
2 Fenix Geoconsult Complex System Approach
3 http://www.bloomberg.com/quote/USDCOP:CUR
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This technical report represents the professional opinion of Ricardo A. Valls, P. Geo. a
QP from Fenix Geoconsult Ltd. The purpose of this report is to provide a summary of the ore potential of the Rionegro area, in Santander, Colombia. This report complies with the standards required by NI 43-101 and Form 43-101F. The opinions expressed herein are based on data and information supplied by, or gathered from, the Client and reflects the opinion of the author.
This document has an inherent preliminary character and is subject to inherent limitations in light of the scope of work, the methodology, and procedures used. This document is meant to be read as a whole and portions thereof should not be read or relied upon unless in the context of the whole.
The QP has relied, and believes that he has a reasonable basis for such reliance, upon the information provided by Sr. Geologist Dr. Jorge Cruz Martín, President of Geoconsultora
Fénix S.A.S. who visited the area several times before while negotiating the acquisition of the property, as well as from Fredy Vladimir Jones Navas, Mining and Environmental
Comptroller from Geoconsultora Fénix S.A.S. that reviewed all the land status of the project, and was able to verify them on the web site of Ingeominas. The QP is satisfied with regard to the project status and legal title to the project.
Finally, the reader should notice the signature date of this report, which is the cut-off date for the information that is included in the present technical report.
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The present report covers the applications of the company in the Rionegro area as shown in Figure 1. The applied area covers an area of approximately 190 km
2
located some 47 km Northwest by road from the city of Bucaramanga, in Santander, Colombia
Figure 1. Current applications in the area of Rionegro.
The Rionegro area is composed of two applications. Coordinates of these applications are shown in Table 1.
Table 1. Licenses of the Client in Colombia, WGS 86 UTM 18 N .
10
11
12
13
14
7
8
9
Point UTM E UTM N
1
2
3
688817
688811
689438
808191
811141
810884
4
5
6
689933
689846
689993
809804
809324
808920
15
16
17
18
690001
690167
689897
689965 809782
689541 810863
688811 811279
688810 811666
689259
690809
690779
690816
808607
808649
809330
812191
812194
808920
808920
690780 808195
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None of the above described properties represent any environmental. All exploration permits have been obtained and are in order, and to the extend known, there are no royalties, back-in rights, payments or other agreements and encumbrances to which the licenses are subjected. Environmental and production permits have been obtained for the exploitation of some placers in the area.
There are currently six access to the license (Table 1, Fig. 2). The main access is by a paved road and then the last few kilometres by the ancient tracks of a railroad that used to serve the city of Bucaramanga and was discontinued. It takes around 2.5 hours to get to the site from the city of Bucaramanga and with the exception of some wooden bridges (Fig. 3), it does not need a 4x4 vehicle.
Table 2. Different access to the Rionegro license.
Section
Distance
(Kms)
Type
Ruta 1
Bucaramanga to Brisas
Brisas to Conchal
Conchal to Salamaga
Ruta 2
Bucaramanga to El Cero
El Cero to Bocas
Bocas to Salamaga
Ruta 3
Bucaramanga to La Fortuna
La Fortuna to Sabana de Torres
Sabana de Torres to Provincias
Provincias to Salamaga
8
2
22
12
12
3
Paved
Dirt road
Dirt road
Paved
Paved
Dirt road
Paved
Paved
Partially paved
Dirt road
Name
66
Former railroad
Former railroad
I – 45
Detour to Bocas
Former railroad
66
45
Former railroad
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Figure 2. Access roads to Rionegro license.
Figure 3. Wooden bridges at some sections of the road to the target.
The Rionegro target is located on a plateau in the Cordillera Oriental of the Colombian Andes, and many residents occupy unstable lands descending steeply from the meseta . Westbound of it, the Rio de Oro Canyon is located at an altitude of 600 meters (2,000 ft) AMSL. Eastbound, the Andean Range rises up in high peaks, reaching almost 3,700m AMSL in the place locally known as "Paramo de Berlin" The city is located at 7°08′N 73°08′W.
The Rionegro is a Horst/Graben system with relative steep walls on both sides of the river basin (Fig. 4).
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Figure 4. Horts/Graben relief at Rionegro target.
Under the Köppen climate classification
4
, Rionegro features a tropical monsoon climate, though it’s a noticeably cooler version of the climate. It falls just short of a tropical rainforest climate as its driest month, January, averages just under 60 mm (2 in) of rainfall.
Altitude affects not only temperature, but also vegetation. In fact, altitude is one of the most important influences on vegetation patterns in Colombia. The mountainous parts of the country can be divided into several vegetation zones according to altitude, although the altitude limits of each zone may vary somewhat depending on the latitude.
The "tierra caliente" (hot land), below 3,300 ft (1,006 m), is the zone of tropical crops such as bananas. The tierra templada (temperate land), extending from an altitude of
3,300 to 6,600 ft (1,006 to 2,012 m), is the zone of coffee and maize. Wheat and potatoes dominate in the "tierra fría" (cold land), at altitudes from 6,600 to 10,500 ft (2,012 to
3,200 m). In the "zona forestada" (forested zone), which is located between 10,500 and
12,800 ft (3,200 and 3,901 m), many of the trees have been cut for firewood. Treeless pastures dominate the páramos, or alpine grasslands, at altitudes of 12,800 to 15,100 ft
(3,901 to 4,602 m). Above 15,100 ft (4,602 m), where temperatures are below freezing, is the "tierra helada", a zone of permanent snow and ice.
Vegetation also responds to rainfall patterns. A scrub woodland of scattered trees and bushes dominates the semiarid northeast. To the south, savannah (tropical grassland) vegetation covers the Colombian portion of the llanos. The rainy areas in the southeast are blanketed by tropical rainforest. In the mountains, the spotty patterns of precipitation in alpine areas complicate vegetation patterns. The rainy side of a mountain may be lush and green, while the other side, in the rain shadow, may be parched.
4 http://koeppen-geiger.vu-wien.ac.at/
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The existing infrastructure forms the base of a successful exploitation program. Roads, water, and industrial electricity are readably available.
Within the limits of the project’s license, there are areas for potential tailing storage, waste disposal, and potential processing plant sites. Experienced mining personnel will need to be brought in, although local workers and gampineros are available in the area.
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The area has been previously explored, unsuccessfully, for coal. There is a current semiartisanal mining operation in the Lebrija River (Fig 5). Besides regional work completed by geologist from Ingeominas and regional surveys, there is no previous work completed in the area.
Figure 5. Semi-artisanal exploitation of placers at the Lebrija River, downstream from the
Rionegro license.
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Figure 6 shows a section of the regional geology corresponding to the Rionegro Horst/Graben area.
Figure 6. Regional geology of the Rionegro area.
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The area of the Project is located in the planes of the transition zone between the Eastern
Cordillera and the Magdalena Middle Valley. In the región outcrop Creatceous sedimentary rocks and Quaternary unconsolidated materials. The Project is located west of the
Bucaramanga-Santa Marta Fault, which is the largest tectonic structure in the area. Within the
Project there are other smaller structures like the Solferino fault, the Río Cáchira Fault, the
Cuesta Rica Fault, the Lebrija Fault, as well as the synclinal and anticlinal of Venegas.
According to (Royero & Clavijo, 2001) the area of the proposed placer operation corresponds to the structural depression of Venegas which is conformed of Paleozoic to Cretaceous formations oriented N-NW and is limited to the East by the Solferino fault and to the West by the Lebrija fault. The depression appears to be the result of a Horts/Graben structure between the Solferino and the Lebrija Faults. Within the Bocas formation, there is an elongated rhyolitic body probable related to the uplifting of the Horts structure. Our exploration discovered a felsic intrusive with associated volcanic rock sor probably tertiary age on the
Eastern flank of the Horst/Graben that probably caused the formation of multiple East-West minor fractures in the area.
The older formations in the area of the license maybe belong to the Proterozoic to Paleozoic
Era and are not well studied yet. The bottom of the cut appears to be conformed of a limestone-rich conglomerate sometimes oxidized in rings around its clasts (Fig. 7)
Figure 7. Limestone-rich conglomerate from Rionegro license.
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Simití Formation (Kis). (Etayo S, 1965) assigned an age of Superior Middle Albian to this formation and suggests a sedimentation environment with little ventilation in the seabed, producing intermittently reducing conditions allowing the margins to have benthic life. The formation is composed of black shales with thin interbedded sandstone-rich limestones and clayey fine-grained, grey yellowish sandstone , stratified into banks up to 50 cm thick with ferruginous and calcareous nodules (Fig. 8). The overall thickness of the unit, based on the geological cross sections is 250 m.
Figure 8. Black shales of the Simití formation in the Rionegro project.
The Luna Formation (Ksl) was first described by (Garner, 1926) in the Venezuelan section of the Perija Mountains. Contact of La Luna formation with the ferruginous Simití formation is in conformity. Later on (Mendoza-Parada et al.
, 2009) subdivided the formation in three members- Salada, Pujamana, and Galembo. According to (Royero & Clavijo, 2001), in the type locality located near to the Sogamoso River town, the Salada member contains black and hard calcareous-rich slates of thin stratification, A few thin layers of black limestone of fine texture, are present with bands and pyrite concretions. Elliptical concretions of limestone with cross section and major axis of 10 to 15 cm, are characteristic of this unit (Fig. 9).
Figure 9. Elliptical concretions of limestone of the Salada member of the Luna Fm. in the
Rionegro license.
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The Pujamana member contains thin layers of a gray to black calcareous-rich shales . Finally, the Galembo member is predominantly a thin, black, hard, stratification of calcareous-rich shales with thin interbedded clay-rich limestone . They are concretions of discoid limestone, with major axis up to of 8 m. The member contains ammonites (Fig. 10) and thin layers of dark blue chert . Phosphate layers near the top of the Galembo contain abundant bone fragments and vertebrae of fish and few teeth.
Figure 10. Ammonites of the Galermo member of the La Luna formation.
Also from the Cretaceous Period is the Umir Fm (Ksu). (Mendoza-Parada et al., 2009) dated this formation as Upper Cretaceous Epoch, Campanian-Maastrictian age. The formation is indicative of an age or marine regression and is conformed from top to bottom by soft greenish-gray shales with layers of a fine-grained, hard sandstone and thin layers of coal that turns to gray to bluish-gray shales at the bottom of the profile with grains and phosphatide fragments of the lower La Luna Formation (Fig. 11). The bottom is a non-conformance contact and represents a variable amount of erosion in the La Luna formation before the deposition of shales of the Umir Fm., as it was revealed in the studies of phosphatic residuals of the La Luna formation.
Figure 11.
Coal bed in a carbon-rich shales .
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Paleogene Period
Lisama Formation (Tlp). (Taborda, 1965) suggested that this unit was deposited during the
Paleocene. The unit was named by Mendoza-Parada et al. (2009). It consists of brown and violet, soft, micaceous-rich clay ; interspersed with fine grain and medium hardness, slightly conglomeratic greenish-grey, micaceous-rich sandstones also some clayey strata contain thin layers of gypsum and mantles of coal towards the top of this unit.
The low hardness of these clay layers make the Lisama formation widely vulnerable to the generation of colluvial deposits (Fig. 12).
Figure 12. Lisama formation in the Rionegro license.
La Paz Formation (Tel). By Chronostratigraphic correlation with adjacent units, the La Paz
Fm. has been awarded an Eocene age. It lies at an angular unconformity with the Lisama
Formation. The La Paz formation consists of hard, conglomeratic, mica-rich, grey fine grained s andstones , with pebbles of quartz, intercalated with gray violet, soft and mica-rich clays .
Esmeralda Formation (Tee). (Pilsbury & Olsson, 1941) assigned an Eocene age, based on gastropods and pelecypods. The unit lies conformably on top of La Paz Fm. It represents the top of the western slope of the La Paz ridge. This unit is formed by mica-rich fine-grained, yellowish grey and yellowish brown sandstone , with cross-bedding and layers of grey clay at the top
La Mugrosa Formation (Tom). This formation is of Oligocene age and has two members. The
Inferior Member (Tomi) is composed of yellowish grey and yellowish-white, fine grain, weakly consolidated and argillaceous sandstone ; interleaved with greenish-gray mica and clay-rich limonite . The Superior Member (Toms) is composed of gray-green and violet clay with layers of coarse-grained sandstone , with feldspar and quartz pebbles, as well as a layer of coarse-grained brown and yellowish conglomerate with angular quartz, feldspar and fragments of metamorphic rocks. Towards the top of the formation there is a fossil horizon
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with presence of freshwater gastropods and bones of fish, dating of Oligocene age. In this unit are drilled oil wells in the area of the Valley of the Magdalena, where has been found glauconite.
Neogene Period
Colorado Formation (Toc). (Taborda, 1965) dated freshwater gastropods which indicate an age of training between the upper Oligocene - Miocene periods below. The formation is composed of layers of gray, hard , conglomerates with pebbles from limestone , chert , and metamorphic rocks, intercalated with lenticular layers of gray coarse-grained sandstone and sand-rich clay .
Real group (Tmr). The typical location outcrops at the Doradas creek and it is composed of three members, but in our area we only see the medium Group (Tmrm) consisting of layers of medium to coarse grained feldspathic, massive light grey sandstone , with some layers of sand-rich clay and a yellowish white sandstone and quartz-rich conglomerate . According to
Mendoza-Parada et al.
(2009) the age is of this Group is Miocene based on leaves of plants and gastropods which indicates a continental origin. The Inferior Group (Tmri) consists of a sequence of thick yellowish-grey conglomerates with pebbles of sandstones, igneous and metamorphic rocks, which are interbedded with coarse-grained volcanic and metamorphic lithic-rich sandstones .
La Mesa Formation, Inferior member (Ymi). The thickness of this unit is of approx. 1100 m and there are no recorded fossils that allow a determination of its age, but based on
Chronostratigraphic correlations its age is estimated as lower Pliocene Epoch. In the area, this formation consists of yellowish to yellowish gray, medium to coarse and moderately consolidated grain structures of cross-bedding conglomeratic-rich sandstones . Intercalated are clusters of yellowish-grey to grey-brown, little consolidated, jagged layers and lenses with pebbles from sandstone, quartz, rocks, igneous, metamorphic and volcanic lithic-rich conglomerates (Fig. 13).
Figure 13. La Mesa Formation, Inferior member (Ymi) in the Rionegro license.
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Quaternary Period
In the area there are two important materials of recent formation, corresponding to colluvial and alluvial deposits.
Colluvial Deposits (Qc). They are caused by processes of weathering and degradation of the rocks that make up the soil or subsoil generating through the erosion of rock, from fragments of the lithologic units emerging in higher areas, then they are transported by means of a natural agent, which is usually rain water. They are mainly located in some sectors of the western slope of the plateau of Lebrija (Fig.12).
Figure 14. Thick colluvial deposits in the Rionegro license.
Alluvial Deposits (Qal). They cover much of the area, on the banks of the Lebrija River. These units are set to the topographical lower areas and they are generated by the deposition of fluvial load material (Fig. 13). They form a flat to soft wavy relief on which the development of cattle ranching has established.
Figure 15. Wide alluvial deposits in the Rionegro license.
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The area of the concession consists of 55% alluvial Quaternary deposits (Qal) and the rest of sedimentary rocks from the Cretaceous La Luna formation (Ksl). In this section the focus is on the alluvial Quaternary deposit formed by the Lebrija River, since the mineral of interest is the alluvial gold.
Figure 14 shows a typical profile of the alluvial sediments at the bed of the river.
Figure 16. Alluvial profile at Rionegro.
Among the host rocks within the limits of the area, besides the Cretaceous limestones of the
La Luna Formation, we have mapped a tonalite intrusive that has zones of intense alteration, represented by acid water (pH 4.5-5) and heavily oxidized with noticeable sulphur smell (Fig.
17).
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Figure 17. Oxidized acid water draining from the tonalite intrusive.
We have also mapped an outcrop of a silica cap (Fig. 18) as well as several outcrops of basalts to andesite-basalt which indicate the presence of volcanic activity in the area that has not been mapped yet.
Figure 18. A silica cap from the Rionegro license.
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The study area presents numerous faults and folds that correspond to structures of the North to
Northwest structural depression of Vanegas. The most important structures starting with the more regional character are:
Bucaramanga - Santa Marta Fault.
With a SSE-NNW direction this sinestral fault system has had over time various vertical components. Its importance lies in the contribution to the development of the Magdalena
Valley and the lifting of the Santander Massif.
Lebrija Fault
It is located approximately 1.7 km west of the Township of Vanegas with a sinuous course towards NNW, until it reaches the municipality of Rionegro. It is a normal fault with a light displacement on the slates of the Q'umir Formation in the area of the Quebrada Salamaga.
Main vertical displacement can be seen in the municipality of Rionegro.
Cuesta Rica Fault
This fault intersects the Lebrija Fault and moves slightly to the Northwest. Apart from this displacement the fault ends in Tertiary units West of the Lebrija Fault. It is estimated a vertical displacement of 400m in Tambor-giron contact.
Anticline and Syncline Vanegas
(Royero & Clavijo, 2001) describes the Anticline of Vanegas as a structure with a somewhat undulating axis and soft pitching towards the South. Regarding the Vanegas Syncline, which occurs in continuity to the Southeast, he says it pitches toward the South and disappears beneath the Lebrija River alluvial Quaternary sediments.
The studied area corresponds to a large Horst / Graben structure, possible pre-PZ in age with an N-S orientation that tends to be diverted to the SW in the direction of the Boyacá folded structures (Fig. 19).
Figure 19. Location of the Horst/Graben structure at Rionegro.
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Horsts are elevated blocks delimited parallel normal faults on both sides. Grabens are block sunk bounded on both sides by parallel normal faults (Fig. 20). These faults represent the structures of the first order and are the oldest in the area.
Figure 20. Tectonic model of the Rionegro license.
In our area, this structure of Horst/Graben appears to be complicated by the intrusion of an igneous body represented by a circular structure and abundance of second order structures oriented radially. This intrusive apparently displaced northward the Eastern wall of the Horst, causing a series of second order parallel and sub-parallel faults horizontal to sub horizontal.
The Graben has served as perfect watershed both for active sediments as for paleo placers, and it is very likely that secondary fractures and faults have helped concentrate the heavy mineralization along such structures.
The Author completed a quick lineament study of the area (Fig. 21) that shows a circular structure that is probably related to a Tertiary intrusive that displaced the eastern side of the
Horst to the North creating a series of sub-parallel fractures. Some of these fractures are leaking acid water (pH 4.5-5) with abundant iron staining, which indicates the presence of sulphides (Fig. 17). These will be the first exploration targets in the area.
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Figure 21. Lineament analysis in the Rionegro area.
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According to what we know from the property, apart from current and paleoplacers associated to the conglomerates, we may also have quartz vein type due to metasomatic remobilization of some gold from the paleoplacers, and modern placers. Most of the information presented here is quoted from the Ministry of Energy, Mines and Petroleum
Resources of British Columbia, Deposit Types/Mineral Deposit Profiles, http://www.em.gov.bc.ca/Mining/Geolsurv/MetallicMinerals/MineralDepositProfiles/pro files.
The presence of pyrite, coal, and other indicators, seems to support the Author idea of the
Rionegro conglomerates to be similar to the Witwatersrand type from South Africa.
There is also the potential for Carlin and skarn type of mineralization in the area.
: Paleoplacer deposits; paleochannel deposits; fluvial and alluvial placers.
Mainly Au and PGE {also Cu, Ag, garnet, cassiterite, rutile, diamond and other gems: corundum (rubies, sapphires), tourmaline, topaz, beryl
(emeralds), spinel; zircon, kyanite, staurolite, chromite, magnetite, ilmenite, barite, cinnabar}. Most of the minerals listed in brackets are recovered as byproducts.
Williams Creek, Bullion, Lightning Creek, Otter Creek, Spruce Creek all of them in British Columbia, Canada. Other examples include Chaudière Valley (Au,
Québec, Canada), Livingstone Creek (Au, Yukon, Canada), Valdez Creek (Au, Alaska,
USA), Ballarat (Au, Victoria, Australia), and Bodaibo River (Au, Lena Basin, Russia).
: Detrital gold, platinum group elements and other heavy minerals occurring in buried valleys (typically with at least several metres of overlying barren material, usually till, clay or volcanic rocks), mainly as channel-lag and gravel-bar deposits.
: Coarse-grained, paleochannel placer Au deposits occur mainly in
Cenozoic and Mesozoic accretionary orogenic belts and volcanic arcs, commonly along major faults that may also control paleodrainage patterns. Fine-grained paleoplacers also may occur in stable tectonic settings (shield or platformal environments) where reworking of clastic material has proceeded for long periods of time.
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: Mainly incised paleochannels in mountainous areas including: high-gradient (generally >0.05, less commonly >0.1), narrow bedrock-floored valleys (paleogulches); high-level, abandoned tributary valleys with intermediate gradients (typically 0.01 to 0.1); large, buried trunk valleys (on the order of 100 m deep, a few hundred metres wide and >1 km long) with low channel gradients (generally <0.02 in mountainous reaches and <0.001 in plateau areas); channels buried in modern alluvial valleys with gradients similar to the modern streams. The first two settings are dominated by high-energy, low-sinuosity, single-channel, coarse-grained autochthonous placer deposits, whereas the latter two are characterized by autochthonous and allochthonous placers deposited in wandering gravel-bed river, braided stream and alluvial fan environments. In most paleochannels, coarse-grained placer concentrations occur mainly along channel floors or along other erosional surfaces such as at the base of cut-and-fill sequences; in meandering stream environments finer grained placers also occur along point bar margins and in other areas of slack water.
: Mostly Tertiary and Pleistocene. Older paleoplacers (excepting the Proterozoic Witwatersrand placers) are rare, due to poor long-term preservation of deposits in high-relief, subaerial environments.
: Coarse (pebble to boulder), rounded gravels (or conglomerate), commonly with sandy interbeds or lenses. Gravels usually imbricated, clast supported, open work or with a sandy matrix, and typically with abundant resistant rock types (quartzite, vein quartz, chert, basalt, granite) and minor, less resistant, lithologies (shale, siltstone, schist, etc.). Au placers are commonly associated with rock types hosting epithermal or mesothermal vein deposits. Paleoplacers can be buried under a variety of materials, including lacustrine silts and clays, fluvial sands and gravels, marine sediments and basalt flows.
: Highly variable and laterally discontinuous; paystreaks typically thin (<
2 m), lens shaped and tapering in the direction of paleoflow; usually interbedded with barren sequences.
: Typically well rounded, flattened flakes or plates of low sphericity; coarse, more spherical nuggets common in high-gradient channels (Fig. 22); fine (flour) gold common in distal stream reaches; evidence of primary crystal structure very rare.
Figure 22. Coarse nuggets of over 2mm from Rionegro license.
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: Au nuggets, flakes and grains and
PGE minerals, Cu, Ag, and various industrial minerals and gemstones (Fig. 23).
Figure 23. Flaques and gold nuggets in the concentrates from Rionegro.
: Quartz, pyrite and other sulphides and in many deposits subeconomic concentrations of various heavy minerals, especially magnetite and ilmenite.
: Fe and Mn oxide precipitates common. Clay alteration of unstable clasts and matrix in some deposits.
: Dominant controls on the geographic distribution of ore include the location of paleodrainage channels, proximity to bedrock sources, and paleorelief (Fig.
24). Paleochannels are locally controlled by faults and less resistant rock units.
Stratigraphically, placers accumulate mainly at the base of erosional successions along unconformities overlying bedrock or resistant sediments such as basal tills or glaciolacustrine clays. Overlying bedded gravel sequences generally contain less placer minerals and reflect bar sedimentation during aggradational phases.
Figure 24. One of the many paleoplacers at Rionegro license.
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: Placer deposits are buried when base level rises or channel abandonment occurs. Factors inducing these changes include glaciation, volcanism, stream capture and cut-off, or rising sea level.
: Paleochannel placer deposits are associated with alluvial fan and fan-delta paleoplacer deposits in some areas. Autochthonous fluvial and alluvial placers commonly derive from hydrothermal vein deposits.
: Alluvial fan and fan delta paleoplacer sequences comprise a distinct subtype of buried placer deposits. They occur in relatively unconfined depositional settings compared to paleochannel placer deposits and typically are dominated by massive or graded, poorly sorted gravels and sands, locally with interbedded diamicton.
They are generally lower grade and larger volume than fluvial deposits but they contain relatively uniform placer concentrations. Paleofan deposits are mainly local in origin as indicated by high clast angularity and local derivation. Placer minerals occur in both poorly sorted debris-flow sediments and interstratified fluvial gravels and sands.
Concentrations are commonly highest at sites of subsequent fluvial degradation.
: Anomalous concentrations of Au, Ag, Hg, As, Cu, Fe and
Mn in stream sediments. Gold fineness (relative Ag content) and trace element geochemistry (Hg, Cu) can be used as a signature to identify lode sources.
: Shallow seismic refraction and reflection techniques are useful for delineating paleochannel geometry and depth to bedrock. GPR is recommended to determine the presence of paleochannels. Electromagnetic, induced polarization, resistivity and magnetometer surveys are locally useful. Geophysical logging of drill holes with apparent conductivity, naturally occurring gamma radiation and magnetic susceptibility tools can supplement stratigraphic data.
: Exploration should focus on sites of natural overburden removal, such as along water channels, and areas underlain by Tertiary fluvial deposits.
Buried placers are commonly preserved below lake sediments, on the lee-side of bedrock highs where erosion was minimal and along narrow valleys oriented transversely to the regional direction of the erosional vector. Airphoto interpretation and satellite imagery data can aid exploration for buried valley placers. Concentrations of magnetite, hematite, pyrite, ilmenite, chromite, garnet, zircon, rutile and other heavy minerals can be used to indicate placer potential.
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: Placer concentrations in fluvial deposits are highly variable both within and between individual deposits. In paleochannel gold placers, grades of 0.5 to 5 g/m3 Au are typical, although grades as high as 75 g/m3 Au are reported. The values, however, do not include overburden dilution factors which can reduce grades tenfold or more. Deposit sizes are also highly variable, ranging from 1000 t to 10 Mt.
: The main economic limitation to locating, evaluating and mining paleochannel placer deposits is the thick overburden which results in high stripping ratios. Over-consolidation of tills and other makes overburden stripping difficult and is a major limitation inhibiting exploitation of these buried deposits.
: Placer gold deposits account for more than two-thirds of the world's gold reserves. Buried- channel placers have been under developed in many countries because of difficulties in locating deposits and high overburden to ore stripping ratios.
Mother Lode veins, greenstone gold, Archean lode gold, mesothermal goldquartz veins, shear-hosted lode gold, low-sulphide gold-quartz veins, lode gold.
Au (Ag, Cu, Sb).
: Gold-bearing quartz veins and veinlets with minor sulphides crosscut a wide variety of host rocks and are localized along major regional faults and related splays. The wall rock is typically altered to silica, pyrite and muscovite within a broader carbonate alteration halo.
Phanerozoic: Contained in moderate to gently dipping fault/suture zones related to continental margin collisional tectonism. Suture zones are major crustal breaks which are characterized by dismembered ophiolitic remnants between diverse assemblages of island arcs, subduction complexes and continental-margin clastic wedges.
Archean: Major transcrustal structural breaks within stable cratonic terranes. They may represent remnant terrain collisional boundaries.
: Veins form within fault and joint systems produced by regional compression or transpression (terrain collision), including major reverse faults, second and third-order splays. Gold is deposited at crustal levels within and near the brittle-ductile transition zone at depths of 6-12 km, pressures between
1 to 3 kilobars and temperatures from 200° to 400°C. Deposits may have a vertical extent of up to 2 km, and lack pronounced zoning.
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: Mineralization is post-peak metamorphism (i.e. late syncollisional) with gold-quartz veins particularly abundant in the Late Archean and
Mesozoic.
Phanerozoic: In the North America Cordillera gold veins are post-Middle Jurassic and appear to form immediately after accretion of oceanic terrains to the continental margin.
In British Columbia deposits are mainly Middle Jurassic (~ 165-170 Ma) and Late
Cretaceous (~ 95 Ma). In the Mother Lode belt they are Middle Jurassic (~ 150 Ma) and those along the Juneau belt in Alaska are of Early Tertiary (~56-55 Ma).
Archean: Ages of mineralization for Archean deposits are well constrained for both the
Superior Province, Canadian Shield (~ 2.68 to 2.67 Ga) and the Yilgarn Province,
Western Australia (~ 2.64 to 2.63 Ga).
: Lithological highly varied, usually of greenschist metamorphic grade, ranging from virtually undeformed to totally schistose.
Phanerozoic: Mafic volcanics, serpentinite, peridotite, dunite, gabbro, diorite, trondhjemite/plagiogranites, graywacke, argillite, chert, shale, limestone and quartzite, felsic and intermediate intrusions.
Archean: Granite-greenstone belts - mafic, ultramafic (komaitiitic) and felsic volcanics, intermediate and felsic intrusive rocks, graywacke and shale.
: Tabular fissure veins in more competent host lithologies, veinlets and stringers forming stockworks in less competent lithologies. Typically occur as a system of echelon veins on all scales. Lower grade bulk-tonnage styles of mineralization may develop in areas marginal to veins with gold associated with disseminated sulphides. May also be related to broad areas of fracturing with gold and sulphides associated with quartz veinlet networks.
: Veins usually have sharp contacts with wall rocks and exhibit a variety of textures, including massive, ribboned or banded and stockworks with anastamosing gashes and dilations. Textures may be modified or destroyed by subsequent deformation.
Native gold, pyrite, arsenopyrite, galena, sphalerite, chalcopyrite, pyrrhotite, tellurides, scheelite, bismuth, cosalite, tetrahedrite, stibnite, molybdenite, gersdorffite (NiAsS), bismuthimite (Bi
2
S
2
), tetradymite
(Bi
2
Te
2
S).
Quartz, carbonates
(ferrodolomite, ankerite ferromagnesite, calcite, siderite), albite, mariposite (fuchsite), sericite, muscovite, chlorite, tourmaline, graphite.
Silicification, pyritization and potassium metasomatism generally occur adjacent to veins (usually within a metre) within broader zones of carbonate alteration, with or without ferro dolomite veinlets, extending up to tens of metres from the veins. Type of carbonate alteration reflects the ferromagnesian content of the primary host lithology; ultramafics rocks - talc, Fe-magnesite; mafic volcanic rocks - ankerite, chlorite; sediments - graphite and pyrite; felsic to intermediate intrusions - sericite, albite, calcite, siderite, and pyrite. Quartz-carbonate altered rock (listwanite) and
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pyrite are often the most prominent alteration minerals in the wallrock. Fuchsite, sericite, tourmaline and scheelite are common where veins are associated with felsic to intermediate intrusions.
Distinctive orange-brown limonite due to the oxidation of Fe-Mg carbonates cut by white veins and veinlets of quartz and ferro dolomite. Distinctive green
Cr-mica may also be present. In the overburden we can find abundant quartz floats.
Gold-quartz veins are found within zones of intense and pervasive carbonate alteration along second order or later faults marginal to transcrustal breaks.
They are commonly closely associated with, late syncollisional, structurally controlled intermediate to felsic magmatism. Gold veins are more commonly economic where hosted by relatively large, competent units, such as intrusions or blocks of obducted oceanic crust. Veins are usually at a high angle to the primary collisional fault zone.
Phanerozoic: Secondary structures at a high angle to relatively flat-lying to moderately dipping collisional suture zones.
Archean: Steep, transcrustal breaks; best deposits overall are in areas of greenstone.
Gold quartz veins form in lithological heterogeneous, deep transcrustal fault zones that develop in response to terrain collision. These faults act as conduits for
CO
2
-H
2
O-rich (5-30 mol% CO
2
), low salinity (<3 wt% NaCl) aqueous fluids, with high
Au, Ag, As, (±Sb, Te, W, Mo) and low Cu, Pb, Zn metal contents. These fluids are believed to be tectonically or seismically driven by a cycle of pressure build-up that is released by failure and pressure reduction followed by sealing and repetition of the process (Sibson, et al.
, 1989). Gold is deposited at crustal levels within and near the brittle- ductile transition zone with deposition caused by sulphidation (the loss of H
2
S due to pyrite deposition) primarily as a result of fluid wall rock reactions; other significant factors may involve phase separation and fluid pressure reduction. The origin of the mineralizing fluids remains controversial, with metamorphic, magmatic and mantle sources being suggested as possible candidates. Within an environment of tectonic crustal thickening in response to terrain collision, metamorphic devolitization or partial melting
(anatexis) of either the lower crust or subducted slab may generate such fluids.
Gold placers, sulphide manto Au, silica veins, and iron formation Au in the Archean.
These deposits may be difficult to evaluate due to "nugget effect", hence the adage, “Drill for structure, drift for grade”.
: Elevated values of Au, Ag, As, Sb, K, Li, Bi, W, Te, and B ±
(Cd, Cu, Pb, Zn and Hg) in rock and soil, Au in stream sediments.
: Faults indicated by linear magnetic anomalies. Areas of alteration indicated by negative magnetic anomalies due to destruction of magnetite as a result of carbonate alteration.
: Placer gold or elevated gold in stream sediment samples is an excellent regional and project-scale guide to gold-quartz veins. Within carbonate
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alteration zones, gold is typically only in areas containing quartz, with or without sulphides. Largest concentrations of free gold are commonly at, or near, the intersection of quartz veins with serpentinized and carbonate-altered ultramafic rocks.
: Individual deposits average 30,000 t with grades of 16 g/t
Au and 2.5 g/t Ag (Berger, 1986) and may be as large as 40 Mt. Many major producers in the Canadian Shield range from 1 to 6 Mt at grades of 7 g/t Au (Thorpe & Franklin,
1984). The largest gold-quartz vein deposit in British Columbia is the Bralorne-Pioneer which produced in excess of 117 800 kilograms of Au from ore with an average grade of
9.3 g/t.
: These veins are usually less than 2m wide and therefore, only amenable to underground mining.
These deposits are a major source of the world’s gold. They are the most prolific gold source after the ores of the Witwatersrand basin.
: Holocene placer deposits; terrace placers; fluvial, alluvial, colluvial, eolian
(rare) and glacial (rare) placers.
: Au, PGEs and Sn, {locally Cu, garnet, ilmenite, cassiterite, rutile, diamond and other gems - corundum (rubies, sapphires), tourmaline, topaz, beryl
(emeralds), spinel - zircon, kyanite, staurolite, chromite, magnetite, wolframite, sphene, barite, cinnabar}. Most of the minerals listed in brackets are recovered in some deposits as the principal product.
: In British Columbia we find Fraser River (Au) and the Quesnel River (Au).
Also in Canada we have the North Saskatchewan River (Au, Alberta, Canada),
Vermillion River (Au, Ontario,Canada), Rivière Gilbert (Au, Québec, Canada), Klondike
(Au, Yukon, Canada). International examples include Rio Tapajos (Au, Brazil), Westland and Nelson (Au, New Zealand), Yana-Kolyma belt (Au, Russia), Sierra Nevada (Au,
California, USA).
: Detrital gold, platinum group elements and other heavy minerals occurring at or near the surface, usually in Holocene fluvial or beach deposits. Other depositional environments, in general order of decreasing importance, include: alluvial fan, colluvial, glaciofluvial, glacial and deltaic placers.
: Fine-grained, allochthonous placers occur mainly in stable tectonic settings (shield or platformal environments and intermontane plateaus) where reworking of clastic material has proceeded for long periods of time. Coarse, autochthonous placer
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deposits occur mainly in Cenozoic and Mesozoic accretionary orogenic belts and volcanic arcs, commonly along major faults.
: Surficial fluvial placer concentrations occur mainly in large, high-order, stream channels (allochthonous deposits) and along bedrock in high-energy, steep-gradient, low-sinuosity, single-channel streams (autochthonous deposits). Concentrations occur along erosional surfaces at the base of channel sequences. Alluvial fan, fan-delta and delta deposits are distinct from fluvial placers as they occur in relatively unconfined depositional settings and typically are dominated by massive or graded sands and gravels, locally with interbedded diamicton. Colluvial placers generally develop from residual deposits associated with primary lode sources by sorting associated with downslope migration of heavy minerals.
Glaciofluvial and glacial placers are mainly restricted to areas where ice or meltwater has eroded pre-existing placer deposits.
: Generally Tertiary or younger in unglaciated regions.
: Well sorted, fine to coarse-grained sands; well rounded, imbricated and clast-supported gravels.
: In fluvial environments highly variable and laterally discontinuous; paystreaks typically thin (< 2 m), lens shaped and tapering in the direction of paleoflow; usually interbedded with barren sequences.
: Grain size decreases with distance from the source area. Gold typically fine grained (< 0.5 mm diameter) and well rounded; coarser grains and nuggets rare, except in steep fluvial channel settings where gold occurs as flattened flakes. Placer minerals associated with colluvial placer deposits are generally coarser grained and more angular.
: Au, PGE and cassiterite (Cu, Ag and various industrial minerals and gemstones).
: Quartz, pyrite and other sulphides and in many deposits subeconomic concentrations of various heavy minerals such as magnetite and ilmenite.
: Fe and Mn oxide precipitates common; Ag-depleted rims of
Au grains increase in thickness with age.
: In fluvial settings, placer concentrations occur at channel irregularities, in bedrock depressions and below natural riffles created by fractures, joints, cleavage, faults, and foliation or bedding planes that dip steeply and are oriented perpendicular or oblique to stream flow. Coarse- grained placer concentrations occur as lag concentrations where there is a high likelihood of sediment reworking or flow separation such as at the base of channel scours, around gravel bars, boulders or other bedrock irregularities, at channel confluences, in the lee of islands and downstream of sharp meanders. Basal gravels over bedrock typically contain the highest placer concentrations.
Fine-grained placer concentrations occur where channel gradients abruptly decrease or stream velocities lessen, such as at sites of channel divergence and along point bar margins. Gold in alluvial fan placers is found in debris- flow sediments and in
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interstratified gravel, sand and silt. Colluvial placers are best developed on steeper slopes, generally over a weathered surface and near primary lode sources. Economic gold concentrations in fluvial deposits occur mainly along erosional unconformities within otherwise a gradational sequences and typically derive their gold from older placer deposits.
: Fluvial placers accumulate mainly along erosional unconformities overlying bedrock or resistant sediments such as basal tills or glaciolacustrine clays.
Basal gravels over bedrock typically contain the highest placer concentrations. Overlying bedded gravel sequences generally contain less placer minerals and reflect bar sedimentation during aggradation phases. Frequently the generation of more economically attractive placer deposits involves multiple cycles of erosion and deposition.
: Fluvial placers commonly derive from hydrothermal vein deposits and less commonly from porphyry and skarn deposits. Allochthonous fluvial placers are far traveled and typically remote from source deposits.
: Anomalous concentrations of Au, Ag, Hg, As, Cu, Fe, Mn, Ti or Cr in stream sediments. Au fineness (relative Ag content) and trace element geochemistry (Hg, Cu) of Au particles can be used to relate placer and lode sources.
: Ground penetrating radar especially useful for delineating the geometry, structure and thickness of deposits with low clay contents, especially fluvial terrace placers. Shallow seismic, electromagnetic, induced polarization, resistivity and magnetometer surveys are locally useful. Geophysical logging of drill holes with apparent conductivity, naturally occurring gamma radiation and magnetic susceptibility tools can supplement stratigraphic data.
: Panning and other methods of gravity sorting are used to identify concentrations of gold, magnetite, hematite, pyrite, ilmenite, chromite, garnet, zircon, rutile and other heavy minerals. Many placer gold paystreaks overlie clay beds or dense tills and in some camps these 'false bottom' paystreaks are important.
: Deposits are typically high tonnage (0.1 to 100 Mt) but low grade (0.05-0.25 g/t Au, 50-200 g/t Sn). Placer concentrations are highly variable both within and between individual deposits.
: The main economic limitations to mining surficial placer deposits are typically low grades and most deposits occur below the water table.
Environmental considerations are also an important limiting factor as these deposits often occur near, or within modern stream courses.
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: Placer gold deposits account for more than two-thirds of the world's gold reserves. Shallow alluvial placers also account for a large part of world tin (mainly from
SE Asia and Brazil) and diamond (Africa) production.
Gold mineralization at Rionegro is currently found in placer (Fig 25), but the Author believes that the source are the hydrothermally altered conglomerates within the Horst/Graben structure.
Figure 25. Gold grains in a heavy mineral concentrate from the Lebrija River.
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With the exception of regional works conducted by geologist from Ingeominas, no systematic exploration work have been completed in the area.
Using existing databases of regional gravimetry and magnetometry 5 the Author compiled
Figures 26 and 27, both of which perfectly identify the Horst/Graben structure in the area.
Figure 26. Gravity acceleration field over the Rionegro license.
5 http://www.altaresolucao.com.br/
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Figure 27. Magnetic declination field over the Rionegro license.
The Client also completed a surface survey using a grid of approximately 100 x 100m. On each point a pit was dig down to the bottom of Horizon B (Fig. 28). From there a sample for enzyme leach multielement analysis plus FA was collected and a series of geophysical parameters were measured, including radiometry, kappametry, and the temperature differences within the surface and the bottom of the hole. A total of 416 holes were completed, documented and photographed. Also part of the material of the bottom was panned. All samples indicated the presence of colors.
As of the date of this report, only the geophysical data was available. The Author processed the data using factor and correlation analysis. We show the main results in Figures 28-31.
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Figure 28. Factual map of the sampling at the Rionegro license.
Figure 29. Factor cluster 1 (U+Th+Total) at the Rionegro license.
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Figure 30. Factor cluster 2 (Ts+Tp+Elevation/Prof.+Kappametry) at the Rionegro license.
Figure 31. RCC 1 (2Th+2Total+U+K) at the Rionegro license.
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The maps show interesting anomalies to the North and Northwest of the sampled area, probably associated to a series of EW lineaments. There is also a significant U+Th+Total anomaly to the SW, probably associated to the tonalite identified in the area.
The Author recommends a HMC
6
study with spectral analysis of the different fractions along the banks of the Lebrija River to find the best places for the exploitation of such placers. The paleoplacers should be explored with a combination of GPR to define the potential banks, with pitting and geochemical sampling to confirm the presence of precious metals. The host rocks should be studied with a combination of lineament and satellite interpretation followed by the FG csa
™ 7
to identify the source of the gold in the placers.
6 HMC- heavy mineral concentrates or panning.
7 Fenix Geoconsultant complex system approach- mapping, geophysics, and geochemistry.
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No drilling has been conducted at the area, except for one test using manual augers completed over a zone of accumulation within a paleo placer (Fig. 32).
Figure 32. Using a manual auger at Rionegro.
As a quick method for testing, the manual auger is very efficient and unobtrusive, but the presence of conglomerates or boulders can stop the hole. In this case, the hole was stopped at
2.5 metres, but the two samples assayed as soil sampling (no panning) detected high grades of gold right from the surface on both samples.
However, for efficient sake, the Author recommends the use of mechanical augers
8
.
8 http://www.littlebeaver.com/products/big-beaver-auger-drill-rig/
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The sampling at the site had have a minimum in situ of manipulation. Rocks and soil have been collected in accordance with CIM recommended best exploration practices
(CIM, 2000).
The only samples that had some sort of field manipulation were the two samples taken in the presence of the Author during the testing of the manual augers. In this case all the material from every metre was previously collected in a plastic tub, mixed with a wooden spoon, quartered, and a 250g of soil material was collected from opposite sides of the quartered material.
The Author is of the opinion that the sampling were completed to best industry practice.
All samples are collected by the technical staff of the Client and are kept at the Client’s main office in Bucaramanga until they are delivered to the laboratory. A sample transmittal form is prepared that identifies the samples shipped and the analytical procedure requested using a unique order number for tracking. The Client utilizes Camp
Control software (www.campcontrol.com) to track the movement of all the samples.
Samples are usually collected by SGS at the office.
On arrival to SGS, the samples are weighed and the numbers are verified. At the SGS facility in Medellín, the samples are crushed in a two-step process to 95% < 10 mesh and a 250 g split was then pulverized to 95% < 140 mesh. All samples are analyzed by ICP-
MS for 32 elements and FA. Gold values above 10g/t are additionally assayed for silver and gold with gravity finish.
The Author is of the opinion that the sample preparation, analyses, and security measurements.
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The Client has adopted Quality Assurance and Quality Control (QA&QC) measures for collecting and processing all samples (Valls, 2011). The QA&QC controls are regularly audited by the Client, and also the Author in the preparation of this technical report.
The Company utilises blanks, duplicates, and standards and to date, has not reported any issues. The Client has used SGS for the majority of assays. The average sample turnaround time from GSS was approximately 7 days.
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There are several licences for Coal in the area, most of them about to expire. Within one of the licenses there is a placer operation conducted by a Colombian Company (Fig. 13).
There are no other adjacent properties in the vicinity of the Rionegro target.
Figure 33. A Colombian Company is currently exploiting one placer in the Lebrija River.
The author feels that mentioning the existence of these deposits is relevant to this report because it gives the reader an indication of the extrapolated potential of the Rionegro target. However, the reader must be clear that the existence of such mineralization in nearby locations is not necessarily indicative of the mineralization of the Rionegro target.
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This section is not applicable at this time.
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Rionegro represents a Horst/Graben PZ structure covered by Quaternary sediments. The host rocks present a geological similarity to the Witwatersrand type of deposits. Besides these, we have current and paleoplacers that can be exploited for precious metals, as well as other products.
The lineament analysis show a circular structure, probably associated with a Tertiary intrusive that could have been the key for the remobilization and concentration of gold associated with zones of hydrothermal and metasomatic alterations, controlled by the sub-parallel faults.
There is the possibility of starting production on some of the current placers and selffinance the exploration of paleoplacers and the conglomeratic rocks.
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Once the contract for the licenses along the river have been signed, the Author recommends a HMC survey of the Lebrija River within the limits of such license, as well as some of its tributaries. The objective is to find the best areas for an industrial operation of up to 200 t/h to obtain not only the precious metals, but also magnetite and other products that could be commercialized.
Depending on financing, a GPR program should be completed to identify paleoplacers in the banks of the Lebrija River. The GPR will identify potential banks (Fig. 14) that will be then tested by pitting and geochemistry.
Figure 34. GPR image.
Finally, the source of the precious metals will be explored in the conglomerates and other host rocks using a combination of lineament analysis, satellite interpretation, mapping, geophysics, and geochemistry (FG csa
™)
The preparation of a detailed budget is not possible at this time. Besides the work described before, it is important to complete a base-line environmental study of the area.
The cost of such study is estimated around US$10,000.
The preliminary HMC survey of the area should cost less than US$10,000. It is roughly estimated that to start production in the area an investment of US$250,000 to 300,000 will be necessary.
The cost of the linear kilometre of GPR is currently US$300 and represents the largest portion of the cost to study the paleoplacers. If we estimate 200 linear kilometres, the cost should be around US$90,000 including the other work and lab test.
The proper exploration of the conglomerates, up to the determination of drilling targets, should be around US$300,000-400,000 and take no more than six months.
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It is also possible that The Client will try to acquire more licenses along the strike of its current license. A budget of US$150,000 is estimated for these activities.
So, let’s say US$ 1,000,000
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IGAC (Instituto Geográfico Agustín Codazzi), 1992. Atlas de Colombia.
Berger, B.R. (1985). Geologic-Geochemical Features of Hot-spring Precious Metal Deposits:
U.S. Geological Survey, Bulletin 1646, pages 47-53.
Cordani, U.G., Sato, K., Teixeira, W., Tassinari, C.C.G. & Basei, M.A.S. (2000). Crustal evolution of the South American Platform. 31 er
Congreso Geológico Internacional, Río de
Janeiro-Brasil. 19-40.
Cordani, U.G., Brito-Neves, B.B. & D’Agrella-Filho, M.S. (2003). From Rodinia to
Gondwana: A review of the available evidence from South America. Gondwana Res., 6 (2),
275-283.
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Fenix Geoconsult Ltd. Page 59

To Accompany the Report titled
“Geological Notes on a Potential Gold Target in Río Negro, Santander, Colombia.”
Internal Report non-compliant with NI 43-101
March 28 th
, 2014
I, Ricardo A. Valls, P. Geo, do hereby certify that:
1. I am currently employed as a consultant by:
Fenix geoconsult Ltd.
133 Richmond Street West
Suite 204, Toronto, Ontario
M5H 2L3, Canada
2. I am a Professional Geologist in the Provinces of Quebec and Ontario, member of the
Ordre des Géologues du Québec under the category of Geologist (416), as well as a member of the Association of Professional Geoscientists of Ontario (0160), the
Geological Association of Canada (A6129), the Mineralogical Association of Canada, the
Association of Exploration Geochemistry, the International Association of Applied
Geochemistry, the Prospectors and Developers Association of Canada, the Canadian
Institute of Mining, Metallurgy, and Petroleum, the Prospectors and Developers
Association of Canada, the Society of Economic Geologists, and the Asociación de
Ingenieros de Minas, Metalurgistas y Geólogos de México.
3. I graduated in 1983 from the Moscow Institute of Mineral Prospecting in Moscow,
Russia, as a Mining Engineer and Geologist, and in the same year I obtained the degree of M.Sc. in Economic Geology from the same Institute, and I have practiced my profession continuously for 31 years.
4. Since 1983 I have been involved in various projects world-wide (Canada, United
States, Africa, Russia, Argentina, Haiti, Dominican Republic, Cuba, and Central
America.). Projects included regional reconnaissance to local mapping, diamond drilling and RC-drilling programs, open pit and underground mapping, geochemical sampling and other exploration techniques pertaining to the study of base and precious metals, nickel-cobalt laterite deposits, and the search for diamonds, P.G.M., R.E.E., silver, industrial minerals, oil & gas, and other magmatic, hydrothermal, porphyritic, VMS and
SEDEX ore deposits.
5. Although this is an internal report and it is not compliant with the requierements and regulations of the NI 43-101, I have read the definition of “qualified person” set out in
National Instrument 43-101 (“NI 43-101") and certify that by reason of my education, affiliation with a professional association (as defined in NI 43-101) and past work experience, I fulfill the requirements to be a “qualified person” (QP) for the purpose of this report.
Fenix Geoconsult Ltd. Page 60

6. I am presently a Consulting Geologist and have been so since September, 1983.
7. I have visited the area described in this report in February 2014 to review and collect necessary information to complete this report.
8. I am responsible for the preparation of the interal report titled Geological Notes on a
Potential Gold Target in Río Negro, Santander, Colombia and dated on March 28 th
, 2014
(the “Internal Report”) relating to the studied area.
9. I have not had prior involvement with the licenses that are the subject of this Internal
Report.
10. In the disclosure of information relating to permitting, legal, title and related issues I have relied, and believe that I have a reasonable basis to rely, on information I collected from the web site of Ingeominas, with respect to the status of the licenses.
11. I am not aware of any material fact or material change with respect to the subject matter of this technical report which is not reflected in the report, the omission to disclose which would have made this technical report misleading.
12. While this Internal Report had follow must of the format of a Technical Report, it is not compliant with that instrument and should not be considered a NI 43-101 compliant
Technical report.
Dated this 28 Day of March, 2014.
(s) Ricardo A. Valls
Name of Qualified Person
Fenix Geoconsult Ltd. Page 61