Drilling report for Yerington Copper Project released
VANCOUVER, BC — Quaterra Resources Inc. (TSX VENTURE: QTA) (OTCQB: QTRRF) and its subsidiary Singatse Peak Services LLC today announced the first results from its ongoing 2017 drill program at its Yerington Copper Project including one hole, YM-041A-17, that extends mineralization at least 800 feet below the existing sulfide resource in the Yerington pit
Drilling began on March 26 to test targets on the Company’s 51-square-mile land package located in the historic Yerington Copper District of Nevada. To date, 12 reverse circulation (RC) holes totaling 9,307 feet and four core holes totaling 8,694.3 feet have been drilled. To lower costs, most holes were begun with RC drilling and completed with core.
The area in and around the historic Yerington pit has been a primary focus. (For drill hole locations please see map on the Company website at http://www.quaterra.com/2017-drill-hole-map). Hole YM-041A-17, drilled at – 55 degrees, intersected 561.7 feet averaging 0.20% copper, including several narrower intercepts with plus 0.30% copper as shown in Table 1. Hole YM-042-17, also drilled at – 55 degrees, collared in the pit about 1,000 feet further west, intersected a similar but lower grade interval averaging 0.12% copper.
These initial results suggest that the large Yerington mine mineralizing system is open to depth and along strike with potential for higher grades. Two additional holes in the pit, YM-043-17 and YM-044-17, are currently in progress. One hole drilled west of the pit did not intersect significant mineralization.
On January 6, 2014, Quaterra released an updated NI 43-101 resource estimate for mineralization in and around the Yerington pit. Using a cutoff of 0.15% TCu, the measured sulfide copper resource contains 31 million tons averaging 0.33% TCu (205 million pounds of copper), the indicated primary copper resource contains 74 million tons averaging 0.30% TCu (428 million pounds of copper), and the inferred primary copper resource contains 128 million tons of 0.23% TCu (600 million pounds of copper). Mineral resources that are not mineral reserves do not have demonstrated economic viability. Hole YM-041A-17, reported today, extends mineralization at least 800 feet below the base of this resource.
Four RC holes have been drilled in the greater MacArthur area, as shown on the location map. Hole QM-315-17, drilled vertically to a depth of 850 feet, intersected 30 feet of endoskarn averaging 0.27% copper, and will be deepened with core drilling. None of the other holes contained significant mineralization, including two additional wildcat holes drilled on the far north and east segments of the property.
The drill program is being funded with an option payment of $1.5 million to SPS by Freeport-McMoRan Nevada LLC (“Freeport Nevada”), a wholly owned subsidiary of Freeport Minerals Corporation, which in turn is a wholly owned subsidiary of Freeport-McMoRan Inc. (NYSE: FCX). Freeport Nevada’s option payment is in addition to option payments by Freeport Nevada to SPS that are being used for property maintenance, G&A and environmental compliance at Yerington.
In June 2014, Quaterra and its subsidiary SPS entered into an agreement which gives Freeport Nevada an option to earn an initial 55% interest in SPS by providing $40.7 million in option payments to SPS. In June 2016, Stage 2 of the agreement was potentially extended by another two years. The Stage 2 extension option payments and any additional option payments will reduce the payments required for Freeport Nevada to earn its initial 55% interest in SPS. Freeport Nevada can earn a further 20% in SPS (increasing its holding to 75%) by spending $97.85 million or by funding a feasibility study, whichever comes first. Before then, Freeport Nevada can terminate the agreement at its discretion. (All amounts are expressed in U.S. dollars).
Quaterra’s Yerington Copper Project is located in the historic Yerington Copper District, about 70 miles southeast of Reno, Nevada. It consists of the Yerington pit sulfide and oxide deposit previously mined by Anaconda; the MacArthur oxide and sulfide deposit; the Bear porphyry copper deposit; and several untested exploration targets. Quaterra’s 51-square-mile land package is situated in a mining-friendly jurisdiction with a history of copper production and good infrastructure. It also owns valuable water rights in the district. Quaterra has been active in the Yerington District since 2006, and has released NI 43-101-compliant oxide and sulfide resources at both MacArthur and Yerington, and a preliminary economic assessment at MacArthur.
The cuts would come as a direct result of reduced tax collections caused by business closures across the Silver State due to the COVID-19 pandemic.