Challacollo

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Reserves and Resources |
NI 43-101 Technical Report and Mineral Resource Update  | Exploration News

The 100% owned Challacollo silver-gold project is located in Region I (Tarapaca) of Chile, approximately 130 km southeast of the port city of Iquique at 20° 57’10” S latitude, 69° 21’20” W longitude. The Project comprises 98 individual mining exploitation concessions totaling 20,378 ha, which grant the owner the right to mine. Challacollo

Permitting:
Mandalay intends to begin the permitting process with collection of critical baseline data starting as soon as possible after close and continuing on to preparation of the permit applications as soon as key information is available from the feasibility study.

Subject to receiving a positive feasibility study and permits, the Company’s goal is to begin construction and get into production as rapidly as possible.

Geology and Mineralization:
Challacollo is an epithermal silver deposit hosted in the Cretaceous Challacollo Volcanic Complex of intermediate to silicic volcanic and associated sedimentary rocks that have been rotated about 20 degrees to the southeast.  Mineralization is contained in a system of northeast- to north-trending epithermal quartz-carbonate-barite veins that have been oxidized to a depth of at least 250 meters (m).  The largest of these veins is the Lolón Vein, which is more than 3.5 km in length and contains the entire estimated Mineral Resource.  This vein is controlled by a normal fault that has been rotated to an apparent reverse orientation by the same structural event that tilted the hosted stratigraphic units. Veins hosted in propylitically altered rock that crop out to the northwest of the Lolón Vein are interpreted to represent deeper exposures of the tilted terrane.  Veins cropping out in the original hanging wall southeast of the now-overturned Lolon vein are hosted by variably silicified, bleached, and oxidized rocks and are interpreted to represent originally shallower exposures, prospective for further mineralization.

Project History:
Work in the historical record of the Challacollo mining district dates back to 1770 when Enrique Espinoza recognized the largest silver deposit found in Chile (then Peru).  In 1896, the Gildemeister firm acquired all the known claims and commenced industrial-scale mining that lasted until 1931, albeit sporadically at times.  Subsequently, the main zone of mineralization was mined by artisanal miners (pirquineros) with no legal title between 1932 and 1980 when silver prices were relatively low.  In 1980, Gildemeister, as Minera Challacollo, reasserted its legal claim and conducted work until the early 1990’s.  In 1998, Minera Challacollo sold its rights to Minera Septentrion (Septentrion), which split off and sold to Silver Standard the “silver” concessions, which have now been acquired by Mandalay.  Prior to selling the peoperty to Mandalay, Silver Standard completed geological mapping, a Controlled Source Audio-frequency Magnetotelluric (CSAMT) geophysical survey, surveying, underground and surface sampling, and diamond and reverse circulation (RC) drilling.

Mandalay Acquisition of Challacollo:
Mandalay Resources Corporation announced its acquisition of Challacollo on December 20, 2013, with final closing completed on February 7, 2014.

NI 43-101 Compliant Resource Estimate; Challacollo Project (Effective Dec 2014)
Click here to see a summary of the Mineral Resource at Challacollo.

Current Work at Challacollo:
Mandalay has initiated a feasibility study and are currently working on:

•    8,000 to 10,000 metres of diamond core drilling and associated assays to infill and expand the initial resource estimate;

•    Re-estimation of the resource including new drilling; mine design and costing;

•    Infrastructure, water, and power investigation;

•    Environmental baseline studies and community consultation.

Qualified Person:
Scott Manske, Chief Cordilleran Geologist of Mandalay Resources, and an Oregon registered Professional Geologist is a “Qualified Person” as defined by NI 43-101.  He has reviewed and approved the technical and scientific information on Challacollo contained on this web page.