OPERATIONS

INDIANA AU-CU

Indiana-web-loc Location Map

The Opportunity

  • An historic NI 43-101 inferred mineral resource estimate1 of over 600,000 ounces of gold equivalent (including 3,093,700 tonnes averaging 2.8 g/t gold and 1.6% copper, at a 4 g/t AuEq cut-off) outlines the existing mineralization and endorses the project's potential
  • Permitted for mining, with two active ramps allowing underground access for exploration and development
  • Excellent regional infrastructure supports near-term reasonable development timelines and costs
  • Exploration upside in veins around known deposit, & throughout the property

Property & Access

The 2,300 hectare, road-accessible Indiana Project is located approximately 40 kilometres north of the city of Copiapó in the 3rd Region of Chile, at a modest 1470 metres above sea level. Local infrastructure includes roads, ports and energy.

Indiana is situated within an Iron-oxide-copper-gold (IOCG) belt that includes mines and deposits such as Manto Verde, Candelaria and Cerro Negro Norte.

Geology and Mineralization

The historic database includes 13,000 metres of diamond drilling in 40 holes, 2,000 chip and trench samples, and detailed geology and structural modeling. Eight major veins have been delineated, approximately 1 metre wide, ranging up to 1.5 kilometres in length and down to 400 metres depth. In 2013, a mineral resource estimate was completed, including a supporting technical report following the guidelines of National Instrument ("NI") 43-101.

The historical resource estimate for the veins averaging over 4 g/t gold-equivalent is summarized in Table 1:

1Table 1. Inferred Resource Estimate @ 4g/t AuEq cut-off.

Vein

Tonnage
(KT)

Au
(g/t)

Cu
(%)

Mo
(%)

AuEq
(g/t)

AuEq
ounces
('000)

Bondadosa

910,400

3.4

1.0

0.019

5.5

160,900

Rucas

750,200

2.1

1.7

0.006

5.6

133,800

Flor de Espino

638,100

3.5

1.3

0.002

6.3

128,300

Indian III

351,400

1.9

1.4

0.009

4.9

55,200

Rosario

443,600

2.7

3.1

0.010

9.0

128,00

Total

3,093,700

2.8

1.6

0.010

6.1

607,000

Notes: 1. From the report titled "Technical Report, Indiana Gold and Copper Project Region III Chile" by Dr. Eduardo Magri, QP, unpublished.
2. The following parameters were used in the calculation of equivalent grade: Gold equivalency based on the following prices: gold -US$1,100/oz, copper -US$2.80/lb, molybdenum -US$12/lb, and adjusted for the following recovery rates: gold –75%, copper –88%, molybdenum –60% (e.g. 1 lbCu = (1 x $2.80) / $1,100 x (88% / 75%) Au Eq.)
3. Areas, tonnages and metal content are rounded to the nearest hundred square meters, tonnes and ounces respectively; vein thickness is rounded to the nearest centimeter, grades are rounded to two decimal places. Rounding may result in apparent differences between tonnes, grade and metal content.

Readers are cautioned that Golden Arrow's QP has reviewed the NI 43-101 for this historical resource estimate and believes it to have been a reliable estimate of Inferred resources at the time of its publication, however a Qualified Person has not done sufficient work to classify this estimate a current mineral resource, and Golden Arrow is not treating this as a current mineral resource estimate. Golden Arrow plans to proceed with a program to delineate current mineral resources by an independent Qualified Person, using CIM best practices and current long-term pricing.

Previous preliminarly metallurgical test work reported rougher cleaner (flotation) gold recoveries in sulphide mineralization of over 85%, with a maximum of 97%, and copper recoveries ranging from 90% - 96%, indicating the potential to develop a gold-copper flotation circuit to process sulphide mineralization. Potential to recover gold and copper in mixed and oxide material requires further testing.

More recently, two ramps were developed that access the Bondadosa vein area. Channel sampling in the ramps returned higher grades than historic resource averages, indicating the potential for larger & higher grades in a new resource delineation.

Option Agreement

Golden Arrow has executed a Definitive Agreement with Mineria Activa SpA, ("MSA"), a Chilean private equity investment management firm focused on exploration to production-stage assets in the Mining sector. Terms for the Definitive Agreement are US$100,000 payment on signing, followed by US$15M in payments staged over 48 months. Prior to Golden Arrow making the last payment of $7M at the end year 4, MSA has the option of retaining 25% of the Project, which will then move forward on a pro rata basis.