Member Info for AGEOS

In view of the ongoing speculation regarding Phase 2 and the impending Mining Company formation relating to the ANZA Project it may be timely to remind LTH's of the Sept 2018 Agreement as it is this which provides the legal framework on which current discussion between Newmont /Agnico and Orosur is based. Newcomers may also be unaware of this Agreement.

I referred in a 19th April post to extracts quoted from a personal copy but having subsequently checked on SEDAR can confirm that there is a redacted version which can be accessed at www.sedar.com [ click on 'search database' then 'company'. Enter “Orosur Mining Inc” as 'company name' and from “August 2018” to October 2018” under 'Date of Filing' and click 'search' From the list of filings click on 'Material Document(s)' dated Sept 14, 2018 at 12.59 ET and enter the 'Verification Code'. The Agreement is entitled “Exploration Agreement with Venture Option” with Effective Date of Sept 7th 2018 and is a legally complex 45 page document.

Content of relevance to current chat-post speculation includes:
“Phase 1 Earn-in Due Date” defined as the fourth anniversary of the Effective Date ie 07.09.2022 ref page 9.

“Subject to Section 9(b), within 90 days following delivery of such Phase 1 Earn-in Notice [confirmed by RNS as completed 09,09.2022] to Minera Anza, the Parties shall enter into the Mining Company Constituent Documents ….. {which] shall reflect and incorporate the principle terms set forth in Exhibit C.” ref pp 17, 9(a). Note 'within 90 days' will have meant commencement by 29.11.2022 at the latest.

Exhibit C details the “Key Terms of Mining Company Constituent Documents” and sets out in 7 pages, the ownership structure and interests [of what will be a Colombian legal entity, ref 17.01.2023 RNS]. It further details the nature and terms of the Phase 2 Earn-in, likewise for the Phase 3 Earn-in, the terms of a Joint Funding and Financing Option, the management structure of the Mining Company [MMA will be Manager, ref 17.01.2023 RNS], Programs & Budgets, and the rights and restriction on Transfers and Changes of Control.

Note: the terms and conditions summarised in the above paragraph are required under section 9(a) to form the basis of the new JV Mining Company. No Party to the Agreement can unilaterally depart from those terms without risk of 'breach of contract' consequences. Any major alteration would require agreement of all Parties and obviously Orosur would not agree to anything detrimental to its own interests.
AGEOS.

Seingred. Your scepticism regarding the continuity of Phase 2 with end of Phase1, which I had inferred from the 02.03.2023 RNS and Turner Pope reports, prompted me to check the Sept 2018 Exploration Agreement which I understand to be the legal basis for the ongoing Orosur/MMA ANZA Project.

From my copy, which I recall was downloaded from SEDAR, Exhibit C, Section 3(a) on page 39, appears to define the “Phase 2 Earn-in Commencement Date “ as being “the effective date of the Mining Company Constituent Documents signed by the Parties” This is supplemented by a schedule of the $4m minimum “qualifying Expenditure Amounts” due during Phase 2 for which the “Annual Periods” are not defined as “Year” 5,6,7,etc as in the Turner Pope report page 4, but as “By the first anniversary of Phase 2 Earn-in Commencement Date” for year 5 and “By the second anniversary.....” for year 6, etc.

Clearly if the “Phase 2 Earn-in Commencement Date” remains as defined above, and has not been superseded by an amendment confirming continuity, then the schedule on page 4 of the 02.03.2023 Turner Pope Research report is, at best, misleading. It should include a transition period of unspecified duration between Phase 1 and 2, since it is already of over 6 months duration. Alternatively, of course, the Turner Pope schedule based on continuity of Phase 1 and 2 could be correct but only if the 2018 Agreement has been amended.

Those expressing impatience at the lack of relevant company updates would be justified in adding this matter to their grievances as it is of material significance to investors.

For those who are not subscription clients of Turner Pope, the most recent research note dated 02.03.2023 is now freely accessible on their website via the link below; just scroll down to the second row of reports.

https://www.turnerpope.com/research

It provides a useful summary from which it is worth noting the following as it has been a matter of some contention on this chat board.

Under “Preparations for Phase 2....” on page 2, it states, as others have previously quoted, “TPI considers completion [of the corporate restructuring] could potentially stretch into Q3 2023.” Note, this means, that in the analysts estimation restructuring has the potential, and not necessarily the certainty, to extend beyond end of June 2023. TPI had previously, in its 02.12.2022 Research Note, anticipated completion by late Q1 2023.

The latest RNS Update, of 02.03.2023, states “This process [ie corporate restructuring] is well underway but is expected to take several months to complete.” It also confirms that Phase 1 “was completed in Sept 2022” and clearly implies that the four years of Phase 2 commences immediately after.

What the TPI Research Note also importantly includes, is that according to the “Three phase JV with MMA over 12 years” as scheduled on page 4, “Phase 2 requires US$4m [of qualifying expenditure] per year”, so confirming that $4m has to be spent by MMA before September 2023.

That implies a resumption of field operations at ANZA, no later than May/June this year, if a multi-target, multi-stage drill program of $4m value is to be implemented and expended for year 5, ie year 1 of Phase 2. A resumption of field operations before the corporate restructuring is completed would be consistent with several references to that effect, including the 17.01.2023 RNS statement “The process to create the Mining Company has now commenced and is expected to take several months to complete, During this process, MMA will be able to continue exploration at the Project, and any expenditures incurred by MMA during this interim period will form part of the Phase 2 qualifying expenditures.”

I therefore anticipate an RNS announcement regarding Phase 2, year 1, commencement of field operations at ANZA, within the current Q2 period. $4m of qualifying expenditure has to be completed within the remaining 4+ months of the current year 1 of Phase 2.
AGEOS

Karl345, in answer to your query. I wrote “By that time [ie second half of 2024] Phase 2 ANZA should be well advanced and the Orosur market cap many multiples of its present value.” {ref Fri 18.56 post]. That was not meant to imply “will be ….many multiples” as you may have assumed. The difference between “should be” and “will be” is material, as the former is based on an assessment of 'probabilities' and the latter on 'certainty'. Admittedly I could have phrased the sentence better so as to avoid ambiguity.

So, to clarify. I am suggesting that, by the second half of 2024 it appears that Phase 2 ANZA should be sufficiently well advanced, and the aggregate drill results sufficiently encouraging [based on my probabilistic assessment of the geology to date], for the mkt cap to be many multiples of the current £15m, based of course on assuming the markets then anticipation of a higher value asset. Thus, by the time that further funds are required ie H2 2024, the consequent dilution should be minimal, as mkt cap and corresponding share-price would be significantly higher than at present.

Hope that answers your query.

Everyonesawinner, yes, with 'corporate and admin expenditure' running at $140,000 a month average based on latest SEDAR filed accounts, and additional c$500,000 required to meet $2m aggregate 'exploration exp' for Phase 1 requirements for both Argentina and Brazil JV Agreements by year end, further funding should not be necessary until second half of 2024. By that time Phase 2 ANZA should be well advanced and the Orosur market cap many multiples of its present value.

As a reminder to LTH'ers and information for newcomers, Ariquemes is subject to a JV Agreement completed 13.01.2022 with Meridian Mining in which Orosur has the option to acquire an aggregate interest of 75%, comprised of a Phase 1 requirement of $1m exploration expenditure within an initial 24 months for a 51% interest, followed by Phase 2 requiring an additional $2m of exploration expenditure within 24 months after the exercise of the first option, for an additional 24% interest.

The 02.03.2023 Operational Update RNS confirmed “a large-scale regional sampling program, taking stream and drainage sediment samples over much of the Ariquemes district. Final results are pending. Once the results are received, it is anticipated that this regional dataset will be able to provide vectors to potential mineralisation that will then form the basis for more targeted exploration programs in the near term.” A Meridian Mining SEDAR filing dated 31.03.2023 includes the exact same wording preceded by “ During the year ended December 31, 2022, Orosur completed....”

In a post dated 03.03.2023 discussing Orosur finances, I concluded that an apparent expenditure of $1.5m max since end of January must largely be apportioned to “exploration expenses” relating to both El Pantano, Argentina and to Ariquemes. What proportion of that expenditure is attributable to Ariquemes is, as yet unknown, but it will probably contribute significantly to the $1m due for Phase 1 of the JV Agreement.

The JV will require the formation of two new companies to hold the exploration licences and applications, including a holding company in Canada, and a local operating company in Brazil.
An [MD & A] 'Management Discussion & Analysis for the year ended May 31, 2022' filed on SEDAR on Sept 28th, reports on page 5 that “Post period end, the required Canadian holding company was incorporated. This will be followed by incorporation of the necessary local Brazilian operating company.”

With only 9 months of Phase 1 remaining, release of the results of regional sampling and identification of potential mineralized prospects, should be imminent, if the $1m exploration expenditure total is to be met by end 2023. An update on this and the El Pantano, Argentina, exploration work therefore seems likely within the next few weeks.

As previously posted and reiterated here, since up to $1.5m of 'exploration expenses' can probably be apportioned to Phase 1 of both Ariquemes and El Pantano prior to the 02.03.2923 RNS confirmation of a “balance sheet of over $4m”, recent speculation regarding further fund raising would appear to be wholly without foundation.
AGEOS.

JD-Nau, entirely endorse your account of Benin. As a geologist with many decades experience of field operations in several African countries, I find the ignorance and prejudice expressed by some on this chat board, deeply shameful.
It is however consistent with the standard to which contributions here have fallen.

The Dec 2022 Investor Presentation which can be accessed via the company website, includes on page 7 the following note relating to “Anza – leases and applications”, “Several new applications on southern margin may be added.”

Since the most southerly targets, APTA, Roble [Charrascala], Cedro [Guaimarala] and Aster, are all within areas for which applications have already been granted, this reference to “new applications” must refer to areas still further south, and if such additional applications are being sought, would presumably be part of the current JV negotiations with MMA [Newmont/Agnico]. Intriguingly, the area immediately to the south includes the Oribella prospect on which I posted details as far back as 19.12.2018.

Outcrop Silver & Gold Corp, which is prioritizing its Santa Ana, Colombia, silver project, currently describes the Oribella Project as one of four potential world-class gold prospects in its Colombian portfolio, for which it is open to offers. In a SEDAR filing dated 30.11.2022 it refers to Oribella as
“Adjoining Orosur Mining Inc Anza Project, which contains the APTA vein deposit and the Charrascala porphyry-epithermal anomalies. The APTA structures are inferred to project onto Oribella. The Oribella mineral system appears to include epithermal veins and replacements superimposed on a large breccia and basalt hosted 'wall-rock' gold and copper porphyry system. The projects surrounding Oribella appear to also include epithermal and porphyry-style mineralization.”

LTH's may also recall that I posted during 2019-20, details of the Exploration Agreement which Miranda Gold [Outcrop S & G] had with Newmont for the Lyra/Pantagora project which effectively resulted in Newmont applying its BLEG [Bulk Leach Extractable Gold] sediment survey technique to most of the area from Buritica south to ANZA. On the basis of that agreement having been successfully concluded it seems highly likely that Newmont will also have been in discussions with Outcrop regarding the future of Oribella. The addition of Oribella to the 8 ANZA targets would appear to be a clear possibility especially in view of Newmont's stated objective of developing 'large-scale, multi-component,autonomous mining complexes' as described in my post of 02.03.2023.
AGEOS.

Yes Sharetrader, and as announced in February, Argentina also, but before these recent additions 70% of their interests were in Colombia and 30% in Nicaragua. The significance of prioritizing GNM is their declared objective of henceforth concentrating on a single potential tier 1 prospect in each of a greater diversity of global jurisdictions. In choosing GNM they have rejected or down-graded 15 other Colombian prospects in their portfolio and no doubt with a data input from Agnico. .

A recent strategic reassessment announced by Royal Road Minerals has resulted in its GNM Project {Guintar-Niverengo-Margaritas, a 50/50 JV with Mineros SA] situated within the ANZA area, being prioritized for development above all other prospects in Colombia. This is of considerable significance to Orosur.

Agnico [50/50 JV partner with Newmont in MMA, operator of ANZA] acquired a 19.9% equity interest in Royal Road in 2019 and a Directorship on the RR BOD This was immediately prior to Royal Roads acquisition of AngloGold Ashanti's Colombian portfolio which included GNM and 15 other gold prospects.

For RR to have now prioritized GNM over all other Colombian assets throughout the Middle Cauca mineralized belt and elsewhere, implies a high level of confidence in the gold/copper potential at GNM, and is a decision which must have been supported by Agnico's expectations of the adjacent ANZA project. The Agnico representative on the RR BOD would have access to all the relevant data relating to the ANZA area potential.

I have posted details of the GNM Project on numerous occasions, most recently on 08.02.2023, from which the following extract is especially relevant:
“The significance of the concession contract integration is that the process of integrating a mining Concession Contract in Colombia requires certain regulatory approvals including the approval of a unique plan of exploration and exploitation (Plan Único de Exploración y Explotación, PUEE) which, amongst other stipulations, requires the applicant to prove that mineralization is continuous across relevant concession contract boundaries.” This relates to integration of the Guintar and Niverengo concessions, the potential significance of which I emphasised by stating: “With an inferred W-E orientation to this metalliferous domain, its immediate proximity to La Virgencita and APTA West, has obvious implications for possible further extensions of mineralization into those concessions also.”

The potential significance of RR's prioritization of the GNM Project is further emphasized by the fact that a “Titleholder” [El Aleman Mine] and an unnamed “Mining Concession Applicant” with interests “located proximal to the Guintar copper/gold project” have Agreements with RR allowing the company, on completion of a successful feasibility study, to purchase their remaining 20% interests, or the 2% net smelter conversion royalty, for a total of US$30m.

This latest initiative from Royal Road, which must have been endorsed by Agnico, provides further indication of the potential at ANZA.
AGEOS

Rem, thanks for that. Much appreciated.

Bhargav, the most recent Research Report for Orosur on the Turner Pope website is dated 02.12.2022, and clearly states in the introductory paragraph the following:
“negotiation and execution of the joint venture agreement (the JVA) between MMA and Orosur remains ongoing, with TPI presently anticipating completion by late Q1 2023.”

If you have access to a more recent report which states Q3, as you have posted, I and I'm sure others would appreciate confirmation of the source of that information. It may be there is a more recent report only available to subscribers and it is from that you are quoting, if so confirmation would be appreciated.

Conversations with colleagues within the mining industry have revealed the intriguing possibility that the need to “advance a variety of licence processes” at ANZA, including “integration of smaller licences” is , in part, driven by long term contingency planning which allows for the possibility of an integrated mining complex. Newmont especially, have for a decade, been progressing their global portfolio towards large scale, multi-component, autonomous mining which has been proven to reduce costs and boost productivity substantially. For maximum flexibility in implementation it is essential to ensure simplicity and conformity in the licensing regime for the whole potential mining complex, including connective tunnelling, electricity generation and supply, logistics and all surface infrastructure.

Somewhat fortuitously, in view of OMI's Argentinian interest, Newmont's latest initiative in this regard is the Cerro Negro mine complex not far from El Pantano. This incorporates three operating underground mines, with two others in development and a further five prospects under evaluation. Initial implementation based on a Sandvik/IBM AutoMine platform ensures autonomous loading and haulage throughout the complex with plans for robotic mining using AI, which would minimize the exposure of the workforce to underground hazards. This futuristic model is seen as the ideal for developing multi-component mining complexes as a replacement for the decreasing number of single large mines which have dominated the industry to date.

ANZA with its 8+ exploratory targets could well be envisaged as a potential multi-component mining complex, so the current focus on rationalization of the licences might be an indication of Newmont/Agnico planning towards that possibility.
AGEOS

Thanks for that bhargav. I'm awaiting email response also.

Part of the 02.03.2023 RNS update which referred to the Anza Project – Colombia, concluded with the following paragraph: “Following completion of drilling, exploration work at Anza has been wound back to allow for the required corporate restructuring of the joint venture agreement to be completed, and to advance a variety of licence processes such as integration of smaller licences and conversion of applications to granted status.”

Leaving aside the observation that this should have read “Following completion of Phase 1 drilling.....”, this statement has been interpreted as meaning there will be no further exploration work at ANZA until the “corporate restructuring of the JV” and all the “licence processes” have been completed.

This interpretation is clearly incompatible with the following statement from the 17.01.2023 RNS re Columbia Update: “The process to create the Mining Company has now commenced and is expected to take several months to complete. During this process, MMA will be able to continue exploration at the Project, and any expenditures incurred by MMA during this interim period will form part of the Phase 2 qualifying expenditures.”

The latter statement confirms that the process of forming the JV and all that is associated with it does not exclude the continuation of exploration work at ANZA. However it is MMA which will determine what, if any, further exploration work, including drilling, takes place at ANZA during the JV forming process, and Orosur will be informed according to whatever protocol is agreed relating to the sharing of such information. Only then would Orosur be in a position to inform the market of impending plans for further work including drilling.

I conclude therefore that further exploration work could be initiated at ANZA at any time during the JV forming process and that the market will be informed of such plans and/or their implementation, as and when OMI are free to release such information.
AGEOS.

Yesterday's RNS update includes reference to the results, to date, of the ongoing exploration work at the La Esfinge prospect in the El Pantano II licence area, Argentina. The recognition of “very large zones of Hg [mercury] and As [ar*enic] anomalism along more than 8km strike of a major NW trending structure” is, together with other evidence, a strong indicator of a potential mineralized target. This conclusion is reinforced by confirmation that geochemical and geophysical field work is continuing and, most significantly, that “environmental permitting work is also underway that will allow drilling to be undertaken later in the year”. Exploratory drilling will presumably conclude the requirement of US$1m expenditure for the Phase I, earn-in necessary to acquire 51% equity in the Project.

For the benefit of those who still fail to understand the potential at La Esfinge, Patagonia Gold has a prospect, the La Josephina Project, 40km due west, which shares very similar geological characteristics and has proven “bonanza” grade gold, multiple-metre intercepts in excess of 100 g/t [max 3m @ 177 g/t au & 7m @ 114 g/t au], in breccias associated with a silica-sinter capped ridge of the same origin as that which caps the La Esfinge ridge. This is an example of the vertical zoning of gold developed in low-sulphide epithermal systems as referred to in yesterday's RNS. The silica-sinter horizon is the upper limit of a hydrothermal mineral system below which gold with some silver accumulates in breccia feed-pipes, joints, faults and porous rock, grading down into a silver rich zone and below that a base-metal zone, all within a few hundred metres depth. In addition, the El Pantano and La Josefina prospects have the same, though parallel, NW-SE structural characteristics and share similar geochemical signatures, which at the latter have proven, with over 500 holes drilled, to be evidence of several gold/silver quartz-vein systems.

Whilst the mineralogical potential of La Esfinge can only be confirmed by drilling, all the field and lab evidence to date is supportive of a possible positive outcome.
AGEOS

Regarding the discussion around cash-flow, arising from yesterday's RNS, there appears to be some confusion relating to the total sums involved and more importantly no reference to the value accruing to the company from that expenditure.

As quoted by others, the RNS of 30.01.2023 states “as at the date of this announcement the Company has a cash balance of US$3.540k”. It also confirms that as at 30.11.2022, the end date of the financial period to which the RNS relates, the cash balance was US$2.906k. Unfortunately neither it or the statutory SEDAR filing of the Financial Statement, provides any information as to where the additional cash inflow of $643,000 during Dec-Jan came from. The “subsequent events” section of the SEDAR filing includes nothing to that effect, so we will have to wait for the next Financial Statement for clarification of whether this sum was a “material cash credit” or a transitory “credit/debit” transaction.

Leaving the above 'confusion' aside and assuming the cash balance at 30.01.2023 to have been $3.540k, then yesterdays “balance sheet of over $4m” inclusive of the $2m option inflow payment, implies a cash outflow of up to $1.5m maximum since end of January. A portion of that, averaging $140,000 per month based on the SEDAR filing, is attributable to “corporate and administrative expenditure” but the remainder will be apportioned to “exploration expenses”, as detailed in yesterday's RNS. This confirmed completion of work at El Pantino by an Orosur team and a consultant structural geologist, and of a “large-scale regional sampling program...over several months” at Ariquemes. Further field work is described as ongoing at El Pantano and “near term” at Ariquemes.

This exploration expenditure will contribute significantly to the US$1m first phase option payments due on both the El Pantano [Argentina] and Ariquemes [Brazil] 'Exploration and JV Agreements'., and should be valued as contributing significantly to realisation of the Phase one 51% ownership it will bring in two potentially very valuable assets.
AGEOS

continuation:

It is this NW-SE oriented fault zone which dominates the structural trend and through its influence on the metallogenesis, determines the location and characteristics of the mineralized vein systems. A similar parallel major fault zone probably exists as determinant of the La Esfinge- San Antonio structural trend and likewise may have been the feeder for the vein systems already identified at both those locations.

Whilst El Pantano is early stage exploration and therefore of secondary importance news-wise, the anticipated update may be of some significance as an indicator of potential.
AGEOS

On the subject of pending news, an MD & A filed on SEDAR on 30.01.2023 referring to the 3 & 6 month periods ending 30.11.2022 summarised the work in Argentina and concluded that “the work has defined a high priority target to be followed in the coming two months”. This also implies that the “wider geochemical analysis, ground magnetics and mapping” mentioned in a 28.06.2022 RNS could have been completed within the December-February peak field season and be ready for release fairly soon.

Although the “high priority target” is presumably the La Esfinge ridge located within the Pantano 2 licence area it is possible that the “wider” surveys may include the San Antonio region first identified by Minsud Resources Corp pre-2011 as including three geophysical targets, all within the three Antonio licences in the SE of Orosur's Exploration and JV Agreement licence area. The three targets are quite diverse in type, including a deep potential mineralised feeder and other resistive and conductive signatures indicative of an epithermal system. What is especially significant however is that the host rocks are of the Chon-Aike formation, the host for 90% of the major epithermal mineral prospects and mines of the Deseado Massif mining province, and that there is a SE-NW structural trend to these rocks indicated by airborne magnetic survey, continuous from San Antonio to the La Esfinge target over a distance of 30km. La Esfinge appears to be within rocks [La Matilde Formation] which are immediately overlying, or laterally equivalent too, the Chon-Aike formation. The structural trend also continues further to the SE and includes the Atlas prospect 1-2km south of Antonio II and within a licence area probably still held by Colque Exploraciones or Golden Minerals.

For those who may not appreciate the significance of geological structural trends in mineral provinces, there is a parallel NW-SE trend immediately south of the La Esfinge – San Antonio trend, which runs from Anglo Gold's Cerro Vanguardia mine, 35km to the SE of San Antonio, to the Austral Gold, Pinguino prospect c10km south of San Antonio I. Cerro Vanguardia is a gold/silver quartz-vein complex hosted by the Chon-Aike formation, occupying a 15 x 10km area and comprising c60 economically mineable veins, 0-200m in depth and totalling over 100km in length. The veins comprise two sets, a predominant one at c320 degree strike and 65-90 NE dip, and a secondary at c105 strike and 60-80 SW dip. The Pinguino prospect is predominantly a silver [25M oz] , with secondary gold,zinc and lead, quartz-vein complex, 14.5 x 4km in area, comprising c70 veins, 113km in total length, up to 150m in depth and up to 13m width, in three sets of 330, 300 [both with SW 60-80 dip] and 70 degree strike. A major SE-NW trending fault [Tranquilo Fault zone] appears to have been the main mineralizing feeder, both for this and the Vanguardia veins, but the host rocks at Pinguino are of pre-Chon-Aike age.

To be continued

Ezhik, apparently awarded 100% to ETAP for a period of 20 years backdated to 01.01.2020 according to a 29.10, 2022 entry in the official Gazette of the Tunisian Republic, as first posted on here by 123tor on 24.12.2022 and discussed in detail in my posts of 8, 19 & 20 Jan.
If EPZ had, as many here appear to have assumed, been an unnamed beneficiary of this concession award, it should have been RNS'd by now. In the absence of such an RNS, what conclusion seems most appropriate?.