Geology

Pinaya can be characterized as a porphyry copper-gold, gold-copper skarn-epithermal, and supergene copper deposit. The deposit is developed in Lower Tertiary Puno Group sediments, which have been intruded and mineralized by Mid-Eocene to Oligocene dioritic intrusive bodies thought to be related to the Incaic Orogeny and the coeval tectonomagmatic emplacement of the Andahuaulas-Yauri Batholith.

Copper mineralization on the property is both hypogene and supergene in character. Structurally controlled mineralization is present in the form of narrow skarn zones and local narrow high grade gold and silver veins on different parts of the property.

Property Geology

Structural Interpretation

Regional Geology:

Most of the stratigraphy, structure, magmatism, volcanism and mineralization in Peru is spatially- and genetically-related to the tectonic evolution of the Andean Cordillera which is situated along a major convergent subduction zone where the oceanic crust, the Nazca Plate, slips beneath the overriding South American continental plate. The Andean Cordillera has a metamorphic rock basement of Proterozoic age on which Hercynian Paleozoic sedimentary rocks accumulated and were in turn deformed by plutonism and volcanism to Upper Paleozoic time. Beginning in the Late Triassic time, following Atlantic Ocean rifting, two periods of subduction along the western margins of South America have resulted in the formation of the present Andes; the Mariana-type subduction from the Late Triassic to Late Cretaceous and Andean-style subduction from the Late Cretaceous to the present.

Peru can be divided into physiographic regions which correspond to tectonic elements of the Andean Cordillera. In southern Peru there are, from west to east, the Coastal Belt, Western Cordillera, Altiplano, Eastern Cordillera, and sub-Andean zones. Heterogeneous Precambrian basement lithologies, underlying the Coastal Belt and comprising part of the Western Cordillera in southern Peru, are called the ‘Arequipa Massif’. The northern extent of the Precambrian basement corresponds to the termination of the Altiplano and the start of the Nazca Ridge. There is an intervening northeasterly trending tectonic element, called the ‘Arica’ deflection or ‘Bolivian Orocline’, that is underlain by basement lithologies where the Andes widen and bend easterly.

Late Triassic to Late Cretaceous Mariana-type subduction resulted in an environment of extension and crustal attenuation producing an oceanic trench, island arcs, and back arc basin from west to east. The back arc basin reportedly has two basinal components, the Western Basin and Eastern Basin, which are separated by the Cusco – Puno high, probably part of the Maranon Arch. The basins are largely comprised of marine clastic and minor carbonate lithologies of the Yura and Mara Groups overlain by carbonates of the Ferrobamba Formation. The western back-arc basin, called the ‘Arequipa Basin’, is the present Western Andean Cordillera of Peru; the site of a Holocene magmatic belt that spans the Andes and was emplaced from Late Oligocene to 25 Ma.

The Western Andean Cordillera is famous for its world-class base- and precious-metal deposits; many of which have been intermittently mined since Incan time. Most of the metal deposits in Peru are spatially and genetically associated with metal-rich hydrothermal fluids generated along magmatic belts that were emplaced along convergent plate tectonic lineaments. Furthermore, many of these primary base-metal deposits have undergone significant secondary enrichment over the last 30 Ma as a result of periodic continental uplift and leaching followed by volcanic cover preservation.

Radiometric studies have correlated the igneous host rocks and attendant hydrothermal alteration for some of the largest and richest porphyry copper deposits in the world along the Western Andean Cordillera from 6 degrees to 32 degrees south, including the Chalcobamba – Tintaya iron-gold-copper karn and porphyry belt (30-35 Ma) in the main magmatic arc, southward through the Santa Lucia district (25-30 Ma) and into Chile. The Andahuaylas-Yauri Porphyry Copper Belt, a well known 300-kilometre long porphyry copper belt related to middle Eocene to early Oligocene calc-alkaline plutonism, is situated along the northeastern edge of the Western Andean Cordillera. The Pinaya property is situated near the south-southeastern end of this belt.

Regional Geology

Property Geology:

Shallow marine and continental clastic sediments with intercalated volcanic sediments, belonging to the late Cretaceous to early Tertiary Puno Group, dominate the Pinaya Project area. The package of rocks can reach a thickness of 800 metres. It has been intruded by stocks of dioritic and monzonitic composition and it is overlain by the Tertiary volcanic Tacaza Group. The dominant structural feature, the Lagunillas Fault Zone (the “LFZ”) appears to have controlled the local deposition of continental clastic sediments.

Deposit Types:

The Pinaya mineralized deposits may be characterized as being of the porphyry copper gold karn and supergene types. They are described as typical of a porphyry environment and similar to some of those found in other parts of southeastern Peru and in northern Chile. They appear to be spatially related to a series of prominent, northwestsoutheast trending faults and shear zones, and genetically associated with metal-bearing hydrothermal fluids related to the emplacement of alkaline intrusions and their associated alteration zones. The structures might be tectonically related to either the LFZ or a similarly orientated, subsidiary fault. The copper-gold tenor with the mineralized centres varies according to the associated intrusive phase, structural complexities and alteration overprints.

The mineral deposits occur in five main zones: the Gold Oxide Skarn Zone; the Pinaya Intrusive Complex (that includes the Northwestern Porphyry, Western Porphyry and Vizcachani Zones), the Montaña de Cobre y Oro Zone, the Pedro Dos Mil Mineralized Complex (that includes the Minas Jorge and Pedro 2000 mineralized occurrences that might be structurally linked with the Montaña de Cobre y Oro Zone) and the Saitocco Zone. The Zones may be classified into three main types: copper-gold deposits associated with karn zones (mainly the Gold Oxide Skarn Zone); classic porphyry copper-gold deposits; and copper-gold deposits in sheared and oxidized country rocks (mainly in the area of the Montaña de Cobre y Oro Zone).