Colorado Resources' Results Fall Short of Phenomenal But the Area Play Looks Resilient

Despite additional intercepts of wide mineralization, June 6 assays from Colorado Resources [V.CXO] failed to meet soaring hopes set by North ROK’s very first hole. That northwestern British Columbia discovery excited anticipation of a project comparable to Imperial Metals’ [T.III] Red Chris project, 15 kilometres east. But while Colorado’s stock has since suffered, a still-strong market cap and recent activity by other companies suggest the area play may yet endure.

The June 6 announcement gave results for three holes, with NR13-003 showing:

- 0.21% copper and 0.55 grams per tonne gold over 152.4 metres, starting at 1.2 metres in downhole depth (including 0.31% copper and 1.04 g/t gold over 52 metres).

NR13-003 was drilled at a -80 degree dip towards the northeast from the same location as discovery hole NR13-001, which was sunk at a -45 degree dip in the same direction. NR13-004 was drilled 100 metres southeast of the discovery hole, showing:

- 0.4% copper and 0.5 g/t gold over 205.2 metres, starting at 158.8 metres (including 0.56% copper and 0.68 g/t gold over 131 metres).

True widths weren’t available. Hole NR13-002, drilled 350 metres west of the discovery hole, found no significant results. The company stated it “may have not been drilled deep enough or at the correct azimuth to adequately test the IP chargeability anomaly that is now better understood with the new detailed geophysics.”

Ongoing induced polarization surveys have so far shown an area 1,200 by 1,200 metres open to the south of the chargeability anomaly where the holes were drilled. The survey also found an area 500 by 1,000 metres open to the north of another chargeability anomaly one kilometre north of the drill holes. “To date less than 5% of the area of these geophysical anomalies has been tested by drilling,” the company stated. “Given these highly encouraging results and better understanding of the system, Colorado is planning an expanded drill program to commence shortly.”

Evidently investors expected better. The discovery hole reported April 25 produced a market-shattering 0.51% copper and 0.67 g/t gold over 333 metres, starting at 2 metres. That included a 242-metre interval of 0.63% copper and 0.85 g/t gold.

All that from the very first hole. Fuelling the excitement was Red Chris, only 15 kilometres away, where Imperial Metals’ open pit is scheduled for production in mid-2014. The project boasts reserves of 301 million tonnes averaging 0.359% copper and 0.274 g/t gold.

Consequently North ROK rocketed Colorado stock from an April 24 close of 16 cents to a May 21 high of $1.74. But by June 6 the shares opened on $1.17, down from a June 5 high of $1.34, then continued to fall. The stock closed June 6 on $0.80, albeit an improvement over the day’s low of $0.66 and far above the pre-discovery $0.16.

Disappointment notwithstanding, the area play may yet have a busy summer in store. Other companies attracted by the region’s porphyry copper-gold potential include Entourage Metals [V.EMT], which on June 3 announced its 100% option on the 6,499-hectare Odin copper-gold property, 22 kilometres north of North ROK and 35 kilometres from Red Chris.

The same day Victory Ventures [V.VVN] announced drilling had begun on its 448-hectare Copau property, 11 kilometres northeast of Red Chris, to test a prospective IP anomaly.

A $20,000 purchase of the 654-hectare Railway property announced May 31 places Granite Creek Gold [V.GCX] 11 kilometres northeast of North ROK. The previous day Romios Gold Resources [V.RG] announced acquisition of another 2,900 hectares “in the vicinity” of Red Chris, bringing its northwestern B.C. land package up to 80,000 hectares.

Following Ashburton Ventures’ [V.ABR] early May acquisitions totalling 1,500 hectares adjacent to and contiguous with North ROK, the company reported on May 28 it staked 852 hectares contiguous with the Hat copper-gold project being drilled by Doubleview Capital [V.DBV] roughly 115 kilometres northeast. Ashburton has since applied for permits to drill the Zetu and Nerok claims near North ROK.

West Cirque Resources [V.WCQ] on May 22 announced a follow-up program for its Castle copper-gold property 15 kilometres west of North ROK and 25 kilometres northwest of Red Chris. The project has undergone historic drilling and, last year, an IP survey. Under a deal signed in March, Freeport-McMoRan may earn an initial 51% interest in Castle and two other northwestern B.C. properties held by West Cirque by funding a total of $8 million over four years. West Cirque wholly owns 431 hectares at Castle, while another 603 hectares have been optioned by Bearclaw Capital [V.BRL].

On May 17 Revolver Resources [V.RZ] revealed its 60% option of Pistol Bay Mining’s [V.PST] Summit B property, 1,394 hectares contiguous with North ROK. Firesteel Resources [V.FTR] announced a tentative agreement on May 14 to option 70% of its ROK Coyote property, “right in the heart of the recent activity” at North ROK and Red Chris, to ASX-listed OZ Minerals. Firesteel’s Copper Creek, another porphyry copper-gold property closer to Doubleview’s Hat project, is the object of a May 6 letter of intent in which Prosper Gold [V.PGX.H] would acquire an 80% interest. Pending a definitive agreement, the deal would give the capital pool company its TSXV qualifying transaction.

A May 9 release from TAD Mineral Exploration [V.TJ] stated it had increased its regional land package by about 926 hectares in addition to an 876-hectare copper-gold prospect the company picked up a few days earlier.

Redhill Resources [V.RHR] optioned an initial 50% of Yellow Chris South from Teuton Resources [V.TUO] on May 6, leaving Teuton with about 10,256 hectares remaining in the region.

Serengeti Resources [V.SIR] reported on May 1 it staked the 5,675-hectare Red Chris North property about 10 kilometres north of the North ROK discovery.

Contiguous to Red Chris, meanwhile, graphite explorer Canada Carbon [V.CCB] holds the 5,260-hectare Red Chris South copper-gold prospect.

Still to come from Colorado are assays from its current 1,500-metre drill program at Eldorado, about eight kilometres northeast of Red Chris. Colorado holds a 75% option on the 3,278-hectare property from Sunrise Resources [V.SHI].