Dorato Resources (TSX: V.DRI, Stock Forum) is focused on the Peruvian side of an established gold district. Its land package is adjacent to the Ecuadorian border across from where a number of world class gold and copper deposits, including Kinross Gold's Fruta del Norte gold deposit, are located. Fruta del Norte is a 13.7 million ounce gold deposit that was acquired by Kinross in July, 2008, via the acquisition of Aurelian Resources. We connected with Keith Henderson, the company's President & CEO, for an exclusive interview on Dorato's progress.
By all accounts the Cordillera del Condor Gold, Copper District along the Ecuador border in Peru is a huge area to explore, does the company have a strategy in place to expedite exploration?
Yes, this is a large land position and efficient exploration required an efficient approach. Systematic on-the-ground exploration could take decades and was quickly ruled out. Airborne geophysics is the approach that has been taken and it has been fast, cost-effective and successful. If readers are interested in the details of the technique, Dorato has provided an explanation of techniques on the company website. In short, a helicopter makes a series of low-flying passes over the block, collecting data on magnetic, electromagnetic and radiometric properties of the rocks. Geologists and geophysical experts then review the data and identify a series of targets based on anomalies. These targets are approximately 2 km by 2 km in size and are small enough to allow systematic on-the-ground evaluation. This is done by collecting geochemical data on ground and by geological mapping and sampling. By collecting this data, the geologists can continually re-prioritize the targets as data is received from the lab. The process of re-prioritizing means that you are always drill testing your best targets first, increasing the chances of an early success. Geophysical data cannot directly detect gold mineralization, but the data does point to certain physical properties of the rocks at surface – it gets you into the right area fast.
The company released some very encouraging trenching results (188 metres of 2.08 grams per tonne) from the Lucero target and the shares of Dorato essentially doubled from 70 cents to $1.40 – how are things progressing at Lucero?
Minera Afrodita’s exploration at Lucero is progressing extremely well. The initial discovery of surface mineralization was in a completely virgin area and was achieved after interpretation of airborne geophysical data. This is important as it bodes well for screening of additional geophysical targets through the remainder of 2011. In the case of Lucero, the geologists who initially checked the anomalies on the ground were able to quickly find gold mineralization and massive magnetite and sulphides associated with skarn mineralization. If the other geophysical anomalies can be relied upon in this way, the geologists will have a great chance of finding a significant deposit in the near to medium term.
The drilling intersected thick mineralization and results have been received for the first 12 drill holes. Three types of mineralization have been intersected to date: skarn mineralization, sediment hosted mineralization and porphyry mineralization. The drilling intersected up to 150 metres of skarn mineralization on the edge of the anomaly – interpretation of the data points to potentially higher-grade gold mineralization to the west and drilling is currently testing this interpretation. The real prize at Lucero, though, is the potential for a large copper-gold porphyry at depth. Drill Hole 19 is currently testing this target for the first time and results are pending.
What’s the next target at Cordillera del Condor and when do you begin work?
A final decision on the next target to be tested will be made in the coming weeks, but it is likely to be Cobrecon, where geologists have identified a gold skarn target and two large porphyry targets. These targets are located just a few kilometres from Santa Barbara and El Hito in Ecuador – two existing porphyry deposits in Ecuador. Each of the porphyry targets is greater than 1 km across and therefore has potential to host sufficient tonnes.
There is a lot of mineralization in the area but the geologists are not focused on drilling a series of small, high-grade gold intersections. This might look good in a news release, but it would not bring the company any closer to a potential acquisition. Real size potential is an important criteria in prioritizing targets and the focus is very much on discovery of a three to five million ounce (or equivalent) deposit. It is important for investors to know that this is the focus of the program.
Disclosure: At publication date Highgrade Editor Kirk Exner owned shares of Dorato Resources, which is also a Stockhouse client.