Southern Arc Minerals Inc. is a Canadian mineral exploration company focused on gold and copper-gold exploration. The Company’s key exploration property is its West Lombok project, with several gold-rich copper porphyry and epithermal gold vein prospects. A second exploration property, East Elang, is being advanced in partnership with Vale. Southern Arc is actively drilling at West Lombok with the objective of completing an NI 43-101 resource estimate for the property by mid-2013.
Southern Arc increases Indonesia project ownership for $1.5 mln
Southern Arc Minerals (CVE:SA)(OTCQX:SOACF) said Thursday that it has acquired an additional five percent interest in two of its projects in Indonesia, increasing its ownership in both projects to 90 percent.
The Canadian mineral exploration company said that it has now increased its ownership of the West Lombok and West Sumbawa (Taliwang) projects in Indonesia, with the remaining 10 percent held by the local Regency Governments.
Southern Arc said it completed the deal through the acquisition of additional shares in PT Indotan Lombok Barat Bangkit (West Lombok project) and PT Indotan Sumbawa Barat (Taliwang project) from its Indonesian partner, PT Permata Puri Mega (PT PPM).
In consideration for transferring its five percent interest in both projects to Southern Arc, PT PPM will receive US$1.5 million and 2.25 million Southern Arc shares, subject to TSX Venture Exchange acceptance.
Southern Arc also announced it has concluded negotiations with the Regency of West Sumbawa, and has entered into a cooperation agreement signed by the West Sumbawa Regent on behalf of that local government.
"Recognizing the geological potential of the West Lombok and Taliwang projects, Southern Arc has increased its interest to 90 percent and secured the support of the local government at both projects as a 10 percent equity partner," said Southern Arc’s president, Mike Andrews.
"This emphasizes our vision of the great potential for both epithermal gold and copper-gold porphyry mineralization at both projects."
Southern Arc noted that it now holds 90 percent of PT Indotan Lombok Barat Bangkit, the Indonesian subsidiary that holds a mining business license to explore the West Lombok property.
The remaining 10 percent is held by the local West Lombok Regency Government under a cooperation agreement completed in December 2010.
"Having the local regency as an equity partner creates a synergistic and mutually beneficial relationship, ensuring government support for the project and long-term benefits for local communities as the project advances," the company said in a recent release.
At West Lombok, exploration is currently focused on epithermal gold mineralization in the Pelangan prospect to the northwest of the property, as well as porphyry copper-gold mineralization around the Selodong prospect in the southeast.
In early April, the company released an update on exploration activities at West Lombok, highlighting Drill hole SLD031, the first to test new porphyry targets generated by an aeromagnetic survey.
Hole SLD031 returned 83.0 metres at 0.33 grams per tonne (g/t) gold and 0.08 percent copper from 285 metres, including 43.5 metres at 0.41 g/t gold and 0.08 percent copper from 306 metres, and 14.0 metres at 0.60 g/t gold and 0.12 percent copper.
This hole tested the North Belikat target, Southern Arc said, and the results were "encouraging" as the target is not exposed at surface, and assays confirm the methodology behind the prospectivity study for finding shallow or blind porphyry mineralization on the property, the company added.
Two of the prospects on the property host a combined proven strike length of more than 21 kilometres of mineralized epithermal breccias, with individual bodies ranging in thickness from two to 66 metres, with a strike length of up to 1,000 metres and a vertical extent of greater than 300 metres.
Southern Arc said it has completed more than 22,000 metres of drilling to date at the West Lombok project, focused on the epithermal gold mineralization, confirming high-grade events typical of epithermal boiling zones and identifying several high-grade shoots.
In addition, the company has completed an airborne geophysical survey of the West Lombok project at 50-metre line spacings to define both near-surface and buried copper-gold porphyry targets, identifying 17 porphyry targets on the property.
Southern Arc also said Thursday, that it has increased its holding to 90 percent in PT Indotan Sumbawa Barat, the Indonesian subsidiary holding the Taliwang project.
The West Sumbawa Regency Government holds the remaining 10 percent in the property, ensuring collaboration and support as the project advances, the company said.
The 31,200 hectare Taliwang property on the island of Sumbawa is prospective for gold, silver and copper with three main prospects: a 1 by 1.5 kilometre gold-silver bearing epithermal vein system confirmed by 56 drill holes; a five kilometre-long northeast trending high-sulphidation alteration zone, paralleling the Batu Hijau mineralized trend; and sedimentary gold-hosted targets.
Southern Arc’s portfolio includes four exploration projects with epithermal gold and copper-gold porphyry prospects on the Lombok and Sumbawa islands in Indonesia, two of which are being advanced in partnership with mining company Vale Ltd. (NYSE:VALE).
The Sabalong project in Sumbawa Island is operated under a joint venture with Southern Arc as the operator of the property, and Vale able to earn a 75 percent interest by funding all expenditures through to completion of a bankable feasibility study.
In early April, the company said that so far, two diamond drill holes have been completed for a total of 1,342 metres, and although no significant results were returned, Southern Arc said the geology and alteration found were encouraging enough to drill a third hole targeting porphyry copper-gold below a lithocap.
The company's key exploration property is its West Lombok project, with several gold-rich copper porphyry and epithermal gold vein prospects.
Southern Arc’s shares were down 1.69 percent early Thursday, trading at 29 cents.