Location: Cauca department, Colombia
Commodity: Gold-silver-copper
Deposit Type: Porphyry gold-copper mineralization, overprinted by epithermal gold-silver veins, and quartz-carbonate-base metal-gold veins
Property Size: 1,808 ha
Ownership: Earn-in up to 70%, option to increase ownership to 100%
License type: One license (1808 ha) and applications
Status: Advancement by Outcrop Gold before seeking a JV-Partner


The Cauca project is located in the Almaguer Mining District in the Cauca Department in the municipalities of La Sierra and La Vega near the Pan-American Highway, the national power grid and an airport. The project can be accessed by car driving 47km south from Popayan on the Pan-American Highway, then 19km on a secondary paved road to Sierra and then 39km by tertiary paved and gravel roads to the project.

The project consists of one large title and a smaller application for a total land area of 1,808 hectares. Outcrop has submitted a large application surrounding the project, but acceptance of these later applications is pending. Terrain, elevation, cultural and environmental aspects of the project are favorable for exploration and development.


Between 1973 and 1978 the Colombian Geological Survey (INGEOMINAS) conducted geological studies in an area which included the Cauca project. JICA (Japanese International Cooperation Agency) performed studies in 1984 that included soil sampling, surveying, mapping and limited drilling in the Diamante mine area. In 2002 INGEOMINAS offered up the area for acquisition through a competitive bidding process.

Between 2007 and 2012, Carboandes SA conducted exploration work on the project and discovered the La Custodia deposit. Carboandes’ work included surface prospecting and sampling, several drill-campaigns, metallurgical work and non NI43-101 resource estimation.

Carboandes also conducted economic evaluations and produced a preliminary optimized pit design and cost estimation internally, for a 5,000 ton per day open-pit operation. In 2017 Carboandes decided to divest the project to focus on coal-mining which is their core business. Discussions were initiated with Outcrop Gold that led to an earn-in agreement where Outcrop can earn up to 70% of the project with the option to increase ownership to 100%.

Historic Studies

Carboandes’ internal non NI43-101 resource estimate for the La Custodia deposit was completed in 2015 and shows a resource of 700,000 ounces Gold at 0.66 g Au Eq/t including gold plus copper and silver credits. The pit was optimized using only gold values. Using a plus 0.3 g Au/t cut-off, three-dimensional grade-shells were modeled and used for a trial pit optimization. Carboandes’ pit-design has 4 million tons of mineralized material containing 307,500 ounces of gold, 1,323,000 ounces of silver and 80,897,000 pounds of copper. There are additional grade shells adjacent to and below the designed pit that are not optimized.

Porphyry-style mineralization is generally uniformly distributed, therefore a simple inverse distance-squared isometric projection was used to assign grades within a block model. No epithermal veins were modelled, and grades were capped at 7 g Au/t. The pit optimization used metal prices of $1,254 per ounce of gold, $15.80 per ounce of silver, and $2.05 per pound of copper. Outcrop Gold emphasizes that the Carboandes resource estimate is non NI43-101 and therefore can only be relied upon as a general guide to estimate exploration potential until verified by independent qualified persons.

The vendor’s third-party metallurgical work shows 95% gravimetric gold recovery in the oxide zone. For the sulfide zone recoveries are estimated at 85% for gold, 80% for copper and 60% for silver using gravity, conventional milling and flotation. Recoveries were estimated from bench-scale tests conducted by independent labs.

Figure 1. Carboandes created plus 0.3 g Au/t grade shells and designed an optimized pit shell. Only porphyry style mineralization and no epithermal veins were modeled. Grades were capped at 7 g Au/t. Drilling was done vertical or on high angles on 100 to 200 m centers.

Exploration Results

Significant drill intercepts from the La Custodia Deposit are provided in the following table. Only intercepts greater than 0.5 g Au/t are shown.

** True thicknesses cannot be accurately estimated at this time, but generally, due to the nature of the deposit, drill thicknesses are thought to be close to true thicknesses.

Table 1. Composited drill intervals over 0.50 g Au/t.

Outcrop Gold has identified 86 core drill intercepts of epithermal vein zones from fourteen drill-holes in the La Custodia deposit. Epithermal mineralization occurs most common in the form of sheeted veins. Less frequent are discrete individual veins and breccia veins. Two vein types are noted from trace element geochemistry: The first are banded or crustiform low sulfidation gold-silver veins sometimes displaying ginguro texture and coarse free gold, the second are quartz-carbonate base-metal-gold veins. For 35 of the 86 epithermal intercepts over 3 g Au/t, the average grade is 8 g Au/t after capping the 1095 g Au/t intercept at 28 g Au/t. However, Outcrop Gold believes that these extreme bonanza grades could significantly contribute to the overall grade of the deposit and capping at 28 g Au/t is arbitrary.

Table 2. At this time true thickness can’t be calculated but Outcrop Gold believes that true width is not less than 50% of the intercept thickness on average. The weighted average grade for thirty-five intercepts over 3 g Au/t is 8 g Au/t. Fifty-one additional intercepts not in this table range from 1.5 to 2.9 g Au/t.

It should be noted that numerous vein zones are commonly intersected in a single drill-hole and reflect closed-spaced veins. Vein zones can be as close as 3 m apart. Carboandes drilling confirms that veins can reach from surface to a depth of at least 400 m. The La Custodia drill-holes are 100 to +250 m apart and are steeply inclined or vertical holes. It is likely that numerous other veins will be intercepted with additional drilling. Roadcut mapping shows that parallel veins predominantly strike northerly and dip steeply to the west and are locally 7 m apart on average. Roadcuts reveal a secondary set of low angle veins cutting the high-angle veins but the distribution of these veins is poorly understood at this time.

Outcrop Gold’s work includes relogging of drill-core, creating interpretive geologic cross-sections and constructing preliminary vein models with statistical grade-trend analysis in Vulcan Mine Modeling software. Mapping will provide good support for vein modeling.

Figure 2. Outcrop Gold is cleaning, mapping and sampling a roadcut that traverses the La Custodia deposit for +1.0 km. The data from this program combined with historic drill results will be the incorporated to develop a three-dimensional geologic model.

Figure 3.  Outcrop Gold’s local crew starts a trench program. Intense surficial weathering permits hand trenching for minor disturbance and easy reclamation. The trench crew consists of twenty local hires that represent twenty families who live within the Cauca project.

Figure 4. The start of a trench segment that shows a sheeted vein zone. Trenches will extend for several hundred meters and provide important data for modeling.

Exploration Model

The Cauca deposit is an analogue to the Tesorito deposit in the Miraflores district in Colombia. At Tesorito, relatively low-grade porphyry mineralization is heavily overprinted by epithermal sheeted veins and breccia. However, the footprint of porphyry and epithermal mineralization at Cauca is much larger than Tesorito.

The genetic model is a gold-copper porphyry intruded into an area of rapid tectonic uplift that was subsequently overprinted by both CBM (Au) veins and late gold-silver veins. The CBM (Au) veins commonly show +1 % copper values which demonstrate an affinity with a deeper intrusive body.

Figure 5. Cauca (and Outcrop Gold’s Mallama project) lies within a major regional-scale structural mineral belt that extends 300 km from Llurimagua in Ecuador to La Colosa in Colombia. Several world-class to giant deposits have been discovered in this belt.

Outcrop Gold believes that it is necessary to model the abundant epithermal veins in the La Custodia deposit to get a true representation of grade. The grade in the La Custodia model is likely significantly underestimated. Internal estimates by Outcrop Gold using weighted volume calculations for vein and porphyry mineralization indicate that the veins may contribute only 20% of the volume but over 75% of the metals in the deposit. All metal values are higher in the veins than in porphyry mineralization.

The La Custodia deposit footprint covers only 14 ha within the 1,808 ha project area. It is likely that mulitple exploration targets will be generated on the Cauca project. There are several more targets on the property that show vein outcrops. Outlying core holes show significant porphyry and epithermal mineralization.

Cauca is a large low-grade gold-copper porphyry that is overprinted by a swarm of high angle and low angle epithermal gold-silver veins, and secondary quartz-carbonate-base metal-gold veins. The porphyry extends over an area of 1.5 x 1.2 km while the veins appear to extend beyond this area. The veins project from the surface to depths of approximately 500 m and are open to depth.

Depending on a positive economic evaluation Outcrop believes that both veins and porphyry mineralization could potentially be bulk-mined in an open pit and that selective higher-grade vein zones could be mined underground below and beyond the limits of an open pit.

Figure 6. A road cut that confirms the orientation of Outcrop’s preliminary vein-modeling. Shown are seven or eight vein zones (two with sheeted veins over 1 m width) within a 40 m interval of porphyry mineralization. The veins have an average spacing of 7 m.

Figure 7. Based on surface mapping, grade trend analysis, and limited work with sections, Outcrop Gold has created an internal non 43-101 vein model. The Carboandes block model, drill-hole traces and a few higher confidence veins are illustrated.  The Carboandes non NI43-101 block model has a dimension of 1.5 x 1.2 km and some veins extend over 1.5 km.

Figure 8. Projected veins shown in a cross section. Outcrop Gold created an updated vein model using eighty-six epithermal drill intercepts and the average vein trend observed in roadcuts. Vein projections are limited to 200 m dip. This is a schematic model for veins using average trends, but each vein segment is supported by one or more drill intercepts. Low angle veins are excluded from this model.

Figure 9. Vein segments shown in plan view.  Outcrop Gold created a preliminary block model constrained by vein margins in order to evaluate the potential effect of veins on the deposit grade.

Geology and Mineralization

Structural controls are related to fault and fracture systems of the Cauca-Romeral mega-structure or suture zone which is a feature of mountain building in the Andes.  The predominant lithologies on the project are continental sediments intruded by hypabyssal diorite and quartz-diorite porphyries. The intrusives show alteration from external propylitic and phyllic to internal potassic. Epithermal veins trend predominantly northeast and have phyllic alteration selvages.

La Custodia is a low-grade gold-copper porphyry deposit with a persistent low sulfidation epithermal overprint of sheeted gold-silver quartz veins, veinlets and stockwork and quartz-carbonate veins with base metals and gold.

The epithermal mineralization frequently shows classic dark ginguro texture with abundant fine to coarse free gold. Dark bands in the veins are probably silver minerals. Fluid inclusion studies show temperatures of vein formation at 400 to 500°C for Type A and Type B porphyry-style veins, and 150°C for epithermal veins, demonstrating distinct phases to the mineralization. The CBM (Au) veins are probably intermediate in the system. Carbonate base metal veins (CBM-Au) typically contain mineralization over extreme vertical extent. In the La Custodia deposit veins extend from surface to at least 400 m depth.

Figure 10. Locally the sheeted veins show classic ginguro-like texture and abundant fee gold. In this figure epithermal veinlets cut earlier porphyry style veinlets. The dark material is probably silver sulfosalts.

Figure 11. Locally discrete veins occur. These veins have a true width of 0.10 to 1.2 m observed in roadcuts and at surface. The displayed vein has a width of 0.23 m.

Figure 12. The prevalent epithermal mineralization style is the occurrence of sheeted vein zone. To the right a sheeted vein zone with a 1.7 m width can be observed that includes two main veins and subsidiary parallel foot-wall veinlets extending the overall width. There are also related tensional veinlets linking the two main veins that are also mineralized.

Figure 13. A sheeted vein zone and linking tensional veinlets. This zone has a width of 1.0 m.

Figure 14. Locally low angle veins crosscut the prevalent high-angle veins with minor displacement. Currently Outcrop has a poor understanding of these veins.

Acquisition Terms

In 2018, Outcrop Gold signed a definitive option agreement to earn up to 100% of the Cauca Project, in three phases:

a) To acquire the first 51% undivided interest in the Cauca project Outcrop has to incur the following exploration expenditures:

(1) obligated
(2) may be extended up to 12-months with payment of US$500,000

As part of the earn-in Outcrop has a commitment to core drill 12,000 meters.

Subsequent to Outcrop Gold’s exercise of the first option, the vendor shall be entitled to a 1.5% NSR royalty on any gold or gold equivalent ounces in excess of 1.0 million ounces produced from the property.

In addition, there will be a payment due to the vendor based upon either Outcrop Gold’s maiden NI 43-101 technical report, or an internal resource estimate – either of which must contain an estimate of measured, indicated and/or inferred gold resources on the property (the “Resource Bonus”).

The payment of the Resource Bonus shall be calculated as USD$5.00 per ounce of gold or gold equivalent of such resources to a maximum of USD $4,500,000.  The Resource Bonus shall be payable in two tranches: the first 50% shall be due on the date of the exercise of the first option, and the second 50% shall be due 12-months later.

b) To acquire the second 19% undivided interest in the Cauca project:

As part of the earn-in Outcrop has a commitment to drill 15,000 meters for a total commitment of 27,000 meters

c) Terms to acquire the final 30% undivided interest in the Cauca project:

2019 PLANS

Outcrop will start a CSR and security program and then focus on work to prove the exploration concept of veins having a significant positive effect on the La Custodia deposit grade. The planned work includes a trenching and a drill program followed by incorporating the results into a geologic model. In addition, exploration will be conducted on the 1,808-ha project area to generate other drill targets outside of the La Custodia deposit.
When appropriate Outcrop will seek a funding joint venture partner for Cauca.