While many junior miners are exploring mines from stage one forward, others have taken the approach of adding advanced-stage mines to their portfolio of projects as a catalyst for expansion and in an effort to significantly reduce the time it takes to realize revenues.
Commodities are still hot across the board with analysts not expecting a slowing in pricing to any significant degree in the future. International turmoil is spurring the latest run in prices, but when it’s not that sort of news, it is demand issues or the weather or some other factor that can quantify continued climbs. For whatever the reason, the fact remains that it is anticipated that resource pricing will continue to move upward.
Vancouver-based Tosca Mining Corp., (TSX-Venture:TSQ) is a company planning on capitalizing on rising resource prices through a business strategy to acquire developed properties in North and South America. Tosca currently has a portfolio of projects including the Secret Pass gold property located in Mohave County, Arizona and is actively exploring the commercial potential of both. The team at Tosca is led by directors that have a wealth of expertise and proven successes in exploration and mining.
Tosca took a major step forward in executing its strategies today by reporting that it has signed a letter of intent to acquire a 100% interest in an advanced stage moly-copper project located in Presidio County, Texas. The 2,880-acre Red Hills project lies along a seven-kilometre mineral district characterized by significant occurrences of precious and base metals, including the Shafter-Presidio silver deposit.
A late-development project, Red Hills overcomes all of the typical obstacles as it is served by U.S. highway 67 and the South Orient Railroad. Water is available from adjoining properties. A major power line serves the Shafter silver property located seven kilometers east of Red Hills as well.
Companies such as ASARCO, Phelps Dodge, Amax and Duval all worked the property during the 1950’s through the 1970’s with 88 holes being drilled showing strong mineralization. In 1997, the Rio Grande Mining Company conducted Pre-Feasibility studies with the goal of determining the viability of extracting the shallow historic copper resources previously identified.
While the data is historical and not verified by a qualified person, the data shows areas such as a molybdenum (copper) porphyry system which occupies a horseshoe shaped zone approximately 1,000 metres long and 200 metres wide with most of the previous drill holes within this zone stopping at an average depth of 430 feet while still in mineralization.
Other data shows a copper blanket with a historic resource estimated at 17.1 million tons averaging 0.35% copper with associated molybdenum credits as well as vertical drill holes identified a shallow, high-grade copper zone containing intercepts highlighted by Hole 36 of 110 feet grading 9.09% copper.
The letter of intent, which allows for a two-month due diligence period, provides Tosca to purchase the 100% ownership of all mineral and surface rights for the Red Hills mineral property via cash payments to Red Hills Copper Corporation, a private arms-length Texas Corporation, in the amount of $10,900,000 and the issuance of 2.1 million common shares over a five-year period, while earning an equity interest.
The first year commitment runs until May 1, 2012 at a cost of $575,000 and 400,000 shares. Red Hills Copper Corporation will retain a 2% net smelter return over the property.
Technically speaking, the news has the share price moving upward, but it is pinned against resistance at 44 cents. With an extremely low float and number of outstanding shares, technical traders will be on high alert for a surge through this resistance level to possibly test the stock price all-time highs of 55 cents as this junior exploration company inches closer to becoming a producing miner, as always, due diligence is always recommended.
