Monarca Minerals (TSXV: MMN) entered into an option agreement to acquire a 100% interest in the 5,580-hectare San José project located in Chihuahua, northern Mexico.
To go ahead with the deal, Monarca will pay a total of $150,000 to the mining concession owners and the agreement includes a 2% Net Smelter Return royalty upon reaching commercial production.
In a media statement, the Canadian miner said that the option agreement is an arm’s length transaction.
“The decision was made to acquire this skarn and potential CRD/porphyry deposit after a surface geophysics program comprised of induced polarization (IP), resistivity, and magnetics survey completed in July and August 2018, discovered very strong IP/magnetic anomalies over a 2.8-kilometre strike length resulting in numerous drill targets,” the release reads.
Monarca said that it is planning an 18-hole reverse circulation drilling program to test the strong IP and magnetics anomalies for potential precious and base metals at depth. The decision to run this program was based on the results of the surface geophysics campaign and the fact that previous chip sampling on the property produced significant gold, silver, copper, zinc and lead results.
The San Jose property is comprised of three mining concessions near the US border, approximately 125 kilometres west of El Paso, Texas. The property also sits 52 kilometres northwest of the underground Bismark silver-lead-zinc-copper mine operated by Grupo Peñoles.