London-listed mining projects specialist Cloudbreak Discovery (LSE:CDL) and Alianza Minerals (TSX-V:ANZ) have optioned their Stateline Property in Colorado to Allied Copper Corp. (TSX-V: CPR). The project is located in Colorado and Utah, and comprises 22 unpatented mining claims from local prospectors.
The Stateline project is located 8 kms along trend to the southeast of the operating Lisbon Valley Copper Mine. Regular readers of The Armchair Trader will know that Cloudbreak Discovery is a natural resource project generator, and works across a wide array of mineral assets that are being developed and managed by an experienced team with a proven track record. This means it is not focused on one particular project or indeed mineral / metal resource.
What are the terms of the deal with Allied Copper Corp?
Under the terms of the deal with Allied Copper Corp, over a three-year period, Allied will incur an aggregate of CAD $3,750,000 in exploration expenditures on the property, with at least CAD $500,000 being spent prior to the first anniversary of the closing date. Allied will also issue 4,250,000 common shares over a three-year period of which 500,000 are due on closing and make an aggregate of CAD $315,000 in cash payments to the Alliance (the partnership between Cloudbreak Discovery and Alianza Minerals) of which $40,000 has been paid and with a further $50,000 due on closing.
The Alliance will retain a 2% net smelter royalty which is not subject to a buy down provision. If Allied acquires additional mineral tenures within the Area of Interest, it will issue the Alliance with additional common shares on a sliding scale. Conversely, if the Alliance acquires mineral tenures within the AOI, it will first offer them to Allied and be compensated on that same sliding scale, should Allied choose to
acquire them.
Kyler Hardy, President and CEO of Cloudbreak, explained some of the key benefits of this deal: “We are delighted to grow our relationship with Allied and are looking forward to lending support for their exploration efforts in the Paradox Basin. Having both Stateline and Klondike with the same partner will allow us to gain a better understanding of the geological setting and explore the regional opportunity unfolding with this partnership.”
What is the Stateline project?
The Stateline project is located approximately 40 kilometres southwest of Naturita, Colorado, covering the state boundary between Utah and Colorado at the southeast end of the Lisbon Valley. This property lies within the Paradox Copper Belt, which includes the producing Lisbon Valley Mining Complex. There are numerous historical copper occurrences that have been identified throughout the belt, however, many of these have not been explored using modern exploration techniques.
Listen: Podcast with Kyler Hardy, CEO of Cloudbreak Discovery
In terms of the actual geology on site, historical surface sampling of mineralised outcrops has yielded assay results up to 1.6% copper and 1.7 grams per tonne (“g/t”) silver and 0.45% copper and 2.1 g/t silver. Disseminated copper-silver mineralisation has also been identified in several outcropping sandstones in other stratigraphic positions. Cloudbreak Discovery said that both styles of mineralisation will be investigated in upcoming work programmes with the goal of refining drill targets in these units. Initial work will include detailed geological mapping, soil and rock sampling, and geophysics.
