Santa Ana - OutCrop Gold

SANTA ANA

THE SANTA ANA PROJECT

The Santa Ana project consists of one mining concession covering an area of 669 hectares, located in the department of Tolima, Colombia. The property is 100% owned by OCG.

The Property covers the core of the historical Mariquita silver district, one of Colombia’s most prolific colonial silver mining camps with production dating back to the 16th century and continuing until at least 1914. The Santa Ana Mine Group was one of the more important producers in the district.

Six vein zones have been interpreted which taken together accumulate to over 6 km of total strike. Each zone contains a package of several parallel veins. Veins mapped to date are north-south, but locally east-west veins are observed, and some historic reports indicate production from both vein-trends.

Gallery

  • Sampling Soil Description Megapozo Line 7

  • Sampling Soil MegaPozo Area Line 7

  • Drilling Hole SALP20DH17 La Porfia HW

  • Drilling Hole SALP20DH15 La Porfia Vein

  • Drilling Hole SALP20DH14 La Porfia Vein

  • Drilling Hole SALP20DH14 La Porfia HW Vein

  • Drilling Hole SALP20DH13 La Porfia Vein

  • BlockVein El Dorado Area

  • Vein Murillo Creek

  • Trench 05 Megapozo Area Sample

  • Trench 05 Megapozo Area

  • Sampling Soil Section Sample SO0456

  • Sampling Soil Detail Megapozo Line 7

LOCATION AND MEANS OF ACCESS TO THE PROPERTY

The Santa Ana project is readily accessible by a combination of paved roads. approximately 15 km southeast of the of the town of Mariquita, and 190 km from Bogota.

MINING HISTORY

There are no records of any recent systematic mining in the project area. Historically, the region is famous for precious metals extraction by the indigenous people, who extracted native gold from unconsolidated Recent-Quaternary sediments, alluvial sediments and underground mining. Following the Spanish Conquest, more formal mining commenced, with extraction of gold and more importantly, silver specifically around the town of Falan to the North. During Spanish control, silver grades were reported to be some of the highest in Latin America. Spanish mining was superseded by British, commonly Cornish migrants who worked their way through Central then Southern America. The British engineer Robert Stevenson, son of George, worked briefly in the Falan area, with well-preserved old mine workings within and around the town, and several km to the South. His reports, with accompanying old plans and sections reveal relatively extensive underground work by the indigenous people and the Spanish, in and around Falan.

On a more regional basis, the following is a précis of part of a compilation of abstracts from the Spanish Archives during the Colonial Period between the XV and XVIII Centuries:

The town of San Sebastian de Mariquita was founded in the year 1551 by Captain Francisco Núñez Pedroso, as the capital city of the Fálan and Palocabildo Provinces. Fernando Silvero claimed to be the first discoverer of gold and silver mines in Mariquita and Fálan, circa 1585, these comprising four veins in the San Juan Bautista hill. In the same year, Captain Diego de Ospina, Matias de Saucedo and Pedro Henriquez mined rich veins in the area. The average smelter return for silver ore during those days was “4 marcos per quintal” (equal to approximately >17kg/ton Ag), according to official reports of Hacienda Santa Fe (year 1585),with reported widths exceeding 1½ varas (4½ feet). Subsequent exploration discovered more veins in the Santa Ana (today Falan) and Frias regions, adding 14 new mines to the district, all of them producing over 1 marco of silver per quintal (approximately 4.3kg Ag per ton).

D. Antonio González, President of the New Kingdom, describes in a summary of the gold and silver mines discovered in the Mariquita and Fálan areas as follows: “these mines exploit three main veins striking North-South and a fourth striking Northeast, with strike lengths over 8 km (1 1/2 castillian leguas)”.

In a document dated 1640, Gonzalo de Murillo Velarde and Antonio Gonzalez described the heyday of the Santa Ana and Lajas mines (between the years 1585 and 1620), when nine mines employed 210 indigenous people, 189 black men and 40 black women in the tunnels, and 81 indigenous people, 76 black men and 3 black women in the amalgamation process.

In 1795, the King of Spain suspended all mining operations in the area due to the financial and material losses from mineral processing, this in part relating to the suppression of the Amerindian workforce and the increase of labour costs.

In 1824, a lease was granted to Herring Graham and Powles from London, UK, but the British didn’t make any profit during the 50 years they were mining the area. The Santa Ana and La Manta leases expired in 1874, and the mines were bought back by the Colombian Government at a very low price in an attempt to discredit the British mining company. During this period, the mine workings reached depths of 100 m (50 brazas) below the Morales creek level (just South of Falan).

INITIAL PROSPECTING AND EXPLORATION MODEL

The veins are interpreted to be a composite of early polymetallic gold-silver orogenic thrust-fold related and later epithermal open-space veins in highly deformed Paleozoic schist, quartzite and gneiss of the Cajamarca Formation.

The orogenic veins may have an intrusive affinity, evidenced by associated tungsten minerals. The veins are both high and low-angle and comprised of pyrite, sphalerite, galena, and silver-bearing minerals and native silver in quartz, quartz-carbonate and quartz-adularia gangue. There are probably multiple overprinting mineralization events over a very long period during rapid terrain uplift. The colonial mines reported average mine widths of 1.5 m and this generally conforms to observations in workings and in modern drill intercepts discussed below. The veins range from 0.20 m to 4 m in width.

Preliminary prospecting was carried out by Condor between 2012 and 2014. Chip samples across the vein collected in 2012 from the historic Santa Ana mine tunnels returned assay values as high as 11 g/t Au and 2,820 g/t Ag. Other high silver values from veins included 929 g/t Ag, 600 g/t Ag and 443 g/t Ag. Values for Condor prospecting samples ranged from less than 50 g Ag/t to 4,530 g Ag/t from veins from sample widths of 0.20 to 1.0 m.

Chip samples collected by Condor from outcrops in 2013-2014 returned several high gold values along with high silver values, including: 68 g/t Au and 422 g/t Ag; 48 g/t Au and 81 g/t Ag; and 36 g/t Au and 163 g/t Ag. The high gold values suggest that precious metal zonation may occur with Ag:Au ratios varying across on the project.

Follow-up reconnaissance prospecting by Red Eagle Exploration from 2016 to 2018 returned values from 52 to 250 g Ag/t from surface samples on the project and up to 600 g Ag/t along southern extensions to the Santa Ana mine vein system near the project.

OCG exploration work during 2019/2020 includes mapping and rock chip sampling, identification and surveying the portals of historic workings, and acquiring and compiling historic exploration results. Local underground mapping was conducted to understand controls to mineralization and geometry of high-grade shoots within the veins.

The main vein zones in the La Ivana target area are La Manta and La Porfia veins. The Company also identified a new vein zone named Guanabana. The veins show an inferred strike length of at least 400 m as inferred from outcrop, vein float and rubble, and historic workings.

The compiled historic and recent samples collected by Outcrop are shown in the tables below – the silver equivalent values range from 7.0 g Ag Eq/t to 8,417 g Ag Eq/t- with a mean value of 1295 g Ag Eq/t and a median value of 403 g Ag Eq/t.

The respective gold equivalent values range from a 0.08 g Au Eq/t to 95 g Au Eq/t with a mean value of 15 g Au Eq/t and a median value of 5 g Au Eq/t.

Condor Precious Metals completed a total of 1,170.5 m drilled in 8 holes on the Santa Ana project. All 8 holes were drilled from a single platform in 2012. The drill-holes were fanned out to test 100 m of strike and 150 m down-dip below open workings locally showing assays greater than 10 g Au/t and 1,000 g Ag/t in channel sampling. All eight holes intersected projected veins. Drill results are provided below.

Hole ID From
(meters)
To
(meters)
Length
(meters)
Au
(g/t)
Ag
(g/t)
CP1201 67.18 67.40 0.22 0.42 112.0
CP1201 78.45 79.30 0.85 1.34 667.0
CP1202 110.03 110.56 0.53 1.21 389.0
CP1202 115.70 116.00 0.30 0.24 100.0
CP1203 83.82 86.86 3.04 3.68 1495.0
CP1203 87.30 88.07 0.77 0.30 90.4
CP1203 100.58 102.40 1.82 1.26 1377.6
CP1204 85.82 86.33 0.51 0.29 110.0
CP1204 110.37 111.04 0.67 0.15 81.2
CP1204 133.15 134.97 1.82 0.47 148.9
CP1205 70.10 74.70 4.60 0.32 178.9
CP1205 88.00 88.80 0.80 1.65 532.0
CP1205 93.70 93.85 0.15 0.63 98.5
CP1205 104.84 107.22 2.38 0.38 192.6
CP1205 118.40 118.87 0.47 0.46 92.6
CP1206 124.66 125.15 0.49 0.34 742.0
CP1206 137.00 137.66 0.66 1.89 685.0
CP1207 167.86 168.41 0.55 0.23 112.0
CP1207 170.47 170.76 0.29 2.45 746.0
CP1207 173.22 173.49 0.27 0.28 150.0
CP1208 160.40 160.85 0.45 2.22 34.2
CP1208 164.00 169.16 5.16 3.51 526.7

In December 2019, OCG initiated a drill program on the La Ivana target. As of June 16, 2020, 20 holes for a total of 2,274 meters of drilling have been completed. Assay results have been received for the first four holes and are shown below. A plan view showing the projection to surface of the drill holes and surface sampling results is shown below. 

Note: Intercepts are calculated using a 0.5 g/t Aueq. cut-off. Silver equivalent and gold equivalent values are calculated using metal prices of $1,580/oz for gold and $18/oz for silver. Metallurgical recoveries are assumed to be 100%.

All 20 drill holes completed to date have intercepted multiple veins with banded-epithermal textures and pyrite-galena sulfide mineralization (photo 1 and photo 2). The veins are similar in appearance to those encountered in surface outcrops and tunnels. At this time, the La Porfia Vein appears to be the most continuous of the veins and has been recognized in each drill hole. The La Porfia vein is interpreted to dip at approximately 45◦ to the west. The other veins intercepted by drilling are interpreted as low-angle splays into the hangingwall of the main La Porfia Vein. Drilling has demonstrated continuity of the La Porfia Vein along a strike length of approximately 350 m and 250 m down-dip.

In the La Porfia Vein, the average downhole intercept length is 0.52 m with weighted average grades of 21.7g/t Au and 1,329 g/t.

In May, 2020 OCG initiated soil sampling and trench sampling along the projected surface trace of the veins. The projected soil sample lines and the vein traces are shown below.

 

Initial results from the soil sampling and trenching show a good correlation with mapped and projected veins. A strong gold-silver anomaly has been defined at the Megapozo target which is located 500 metres south of La Ivana with soil values up to 11.8 ppm gold and 336 ppm silver and recent trench samples with values up to 0.6 metres of 102.5 g Au/t and 637 g Ag/t. Three other trenches pending assays show vein widths of 0.6 metres and locally there is a composite vein and veinlet zone of 1.5 metre width. Soil lines on the Megapozo target show anomalies that are continous over 30 to 70 metres – suggesting that multiple subparallel veins comprise the Megapozo target. The trenching and soil sampling programs are defining drill targets at Megapozo. OCG expects to begin drilling at Megapozo on June 23rd, 2020.

Megapozo is on strike between the two targets that have been drilled to date – La Ivana and Roberto Tovar.  These targets are 1.5 kilometres apart with both containing high grade mineralization.  Megapozo potentially connects these targets. At least five anomalous zones of gold and silver have been identified at Megapozo, four of which present high values for both gold and silver, associated with the Paraiso, Miraflores and La Porfia veins. These results suggest an important high-grade ore-shoot occurs at Megapozo related to the convergence of these three veins.

 

                            Table 1: La Manta vein zone:

                            

Table 3: El Dorado vein zone 500 m north
 

of the central La Ivana Area but within
 

Phase 1 work area

NATURE OF INTEREST AND TERMS OF ACQUISITION

OCG closed the acquisition of the Santa Ana Silver Project (the “Property”) on January 27 2020, pursuant to a share purchase agreement (the “Agreement”) with Cedar Capital Corporation (“Cedar”).

Pursuant to the Agreement, the Company acquired all of the issued and outstanding shares of Cedar’s wholly-owned subsidiary Malew Overseas S.A. (“Malew”) in consideration for 24,000,000 common shares of the Company. In connection with the Transaction the Company also issued 350,000 common shares to an arm’s length party as a finder’s fee. All securities issued pursuant to the Transaction will be subject to a four month hold period in accordance with applicable securities laws and the policies of the TSX Venture Exchange.

Pursuant to the Agreement, Cedar acquired 24,000,000 common shares of the Company as part of the aggregate consideration for the Company’s acquisition of all the issued and outstanding share capital of Malew.

As a result of the foregoing issuance, Cedar now owns 24,000,000 common shares representing approximately 38.39% of the current 64,190,345 issued and outstanding common shares of the Company, on an undiluted basis.

EXPLORATION PROGRAM

Outcrop Gold believes Santa Ana is the best primary high-grade silver exploration project in Colombia, and that the project potential is significantly enhanced by the recently recognized high-grade gold veins. Historic colonial mining records, and limited historic drilling and high values in rock samples all indicate exceptional potential for Santa Ana.

Exploration activities consisting of surface and underground mapping, trenching and soil geochemical sampling will be carried out in order to gather further information regarding deposit type, the extent and number of veins present, their widths, structural controls, ore shoot characteristics, geochemistry and alteration. The collected data will be used to better define drill targets for an approximate 10,000 meter drill program during 2020.

Alongside this work, we will work with local communities and authorities to promote awareness of the project and promote inclusion of all stakeholders, fostering collaborative work that will generate mutual benefits for Miranda and the local communities.

Miranda is seeking a joint venture partner agreement on Santa Ana.