Riverside has acquired the option to earn 100% of two large mining concessions, creating the consolidated Cecilia gold project. The project’s concessions were previously owned by Gunpoint and Millrock Resources. The project is a low-sulphidation epithermal gold-silver project and has seen significant exploration including drilling by past owners.
The Cecilia gold project’s prominent volcanic dome feature seen in the background with access road in foreground.
Work by previous operators has included sampling, mapping, trenching, geophysics, and diamond drill programs. Highlighted results reported by prior operators include:
The Cecilia gold system at Cerro Magallanes was systematically explored for the first time by the Consejo de Recursos Minerales (“CRM”), which has been replaced by the present Mexican geological survey, the Servicio Geologico Mexicano. A 1981 regional stream sediment survey identified the area centered on Cerro Magallanes as being a significant gold target and in 1983 CRM carried out a program of detailed mapping and channel sampling in nearly thirty underground workings that date back to the 1940’s and which are mainly found on the eastern flank of the mount. This work was followed up with a program of extensive outcrop sampling (635 samples). In 1988, CRM diamond drilled four boreholes with a combined length of 732.3 meters. As reported above, drill-holes 88-03 and 88-04 returned +100 meter-long intersections of low-grade gold and silver mineralization.
In 1993, the Mexican subsidiary of former Canadian gold miner Cambior Inc. optioned the Magallanes Project, today’s Cecilia Project, from CRM. In the following two years Cambior Exploración S.A.de C.V. (“Cambior”) completed a ground magnetometer survey and 19 line-kilometers of induced polarization survey over the volcanic dome complex, channel sampled six of the larger underground workings, collected 666 rock-chip samples on surface and then diamond drilled 3,811.6 meters in nineteen holes. The best result of the drilling was obtained by drill-hole 138-95-08, which intersected from close to surface 30 meters grading an average of 1.41 g Au/t. Cambior terminated the option in 1997 when the company exited Mexico. Relatively little exploration work has been done on the Cecilia property since the Cambior option period. In 2004, Chesapeake Gold Corp. optioned the project from CRM and eventually acquired it outright, subject to a 1% NSR that was retained by the Servicio Geologico Mexicano. Chesapeake conducted additional rock sampling, mostly in areas surrounding Cerro Magallanes, and completed three lines of IP survey over zones of previously identified mineralization. Gunpoint Exploration Ltd. acquired the three Cecilia-Margarita concessions from Chesapeake in November of 2010, but has conducted only minor fieldwork on the concessions since obtaining them as part of a broader property transaction with Chesapeake.
The consolidated Cecilia property covers a volcanic dome complex of Tertiary age that forms a prominent topographic feature locally known as Cerro Magallanes. The complex comprises extrusive and intrusive rhyolite lithologies and was deposited on a folded sequence of older, mainly Cretaceous sedimentary rocks at the intersection of regional northwest- and northeast-striking fault structures. Gold mineralization at Cecilia is associated with intense fracturing of the silicic host rocks, extensive disseminated iron oxide alteration and minor but widespread fluorite that generally occurs with quartz in veinlets. The precious metal mineralization that has been sampled on surface and in underground workings by previous workers is interpreted by Riverside to be forming the oxidized, high-level portion of an intermediate-sulphidation epithermal mineral system. In addition to having potential to yield a near-surface gold deposit amenable to open-pit mining, the geological setting of the Project is considered to be prospective for deeper deposits of precious metal-rich polymetallic mineralization in the form of large sulphide-rich veins and stratabound replacement bodies of the type that are well represented by several major silver-lead-zinc-copper resources, which have been mined in central and northern Mexico since the late 16th Century.
Cecilia is located in northeast Sonora Mexico, approximately 35 kilometres (‘km’) southwest of the United States border city of Douglas, Arizona. The property is within the extensive Basin and Range geological terrain that extends through the states of Arizona and Sonora. This belt of rocks is home to several billion tonne plus copper porphyry deposits; including Southern Copper’s Mina Cananea located 40 km to the west of Cecilia and the famous past producing Copper Queen mine located 30 km to the north in Bisbee, Arizona. The Cecilia project is well located, accessible by road, and has no Ejido.
Cecilia covers Cerro Magallanes, the dominant topographic feature in the area. Cerro Magallanes hosts a large number of historic workings centered on gold-silver bearing quartz veins and breccias. The mountain itself and other nearby hills are the expression of a large Tertiary aged rhyolite dome complex. Rhyolite is a silica rich rock, highly susceptible to fracturing under stress which creates pathways for later fluid flows, making it a potentially good host for precious metal mineralization. Notable examples of Tertiary age felsic volcanic dome hosted gold-silver deposits include Sleeper in Nevada, La Joya in Bolivia, and El Penon in Chile. At Cecilia, gold-silver mineralization is related to northwest and northeast trending regional structures and associated zones of hydrothermal and structural breccias. Precious metal enrichment is commonly associated with mineral/alteration assemblages of silica, hematite, fluorite, calcite, pyrite, montmorillonite, kaolinite and adularia.
The Company has purchased the Violeta concession from Millrock for C$10,000, 100,000 Riverside shares and by granting Millrock a 0.5% Net Smelter Return royalty. Riverside concurrently agreed to terms with Gunpoint and signed an option to purchase agreement to acquire a 100% interest in the three Cecilia-Margarita concessions (the “Option”) by making the following cash payments and share issuances:
*The Mexican Agreement is a subsequent Option Agreement in the Spanish and English languages, suitable for registration with the Direccion General de Minas in Mexico. The Cecilia-Margarita concessions are subject to a 1% NSR royalty in favour of the Servicio Geologico Mexicano (formerly Consejo de Recursos Minerales). Both agreements are subject to approval by the TSX Venture Exchange.
Disclosure Note: The above-described exploration work programs and the analytical results that were reported by previous operators on the Cecilia property are considered to be historical. The reliability of the historical data is uncertain but is considered to be relevant by Company management. It is the Company’s intention to verify, wherever reasonably possible, the most significant historical data; however, there is a risk that the Company’s confirmation work or future drill testing may produce results that substantially differ from the historical results.
Riverside is working on compiling historical sampling and drill-hole data and has begun defining future drilling targets. Fieldwork will begin shortly to confirm and enhance existing interpretations of the geology that was previously mapped on the property. Additional rock-chip sampling will also be done on surface to confirm certain existing assay results and to expand known zones of higher grade gold mineralization. Historical drill-hole and underground sampling data will then be integrated with Riverside’s surface geology and geochemical database to produce a 3D model of the litho-structural setting and the controls on the Cecilia mineral system. This model, along with Riverside’s strong understanding of rhyolite dome-related polymetallic ore systems, will significantly assist the Company in defining high-potential drill targets at various levels in the gold-silver mineral system, including targets that are not readily apparent in bedrock exposures found at surface.
The scientific and technical data contained in this news release pertaining to the Cecilia Project was reviewed and approved by Locke Goldsmith, P.Geo, P. Eng, a non-independent qualified person to Riverside Resources, who is responsible for ensuring that the geologic information provided in this news release is accurate and who acts as a “qualified person” under National Instrument 43-101 Standards of Disclosure for Mineral Projects.