2024 exploration program for renamed Sierra Azul Copper-Silver Project, funded by Freeport-McMoRan Exploration Corporation – Richard Mills

2024.08.03

Max Resource Corp (TSXV:MAX; OTC:MXROF; Frankfurt:M1D2) is taking a fresh approach to exploring its Sierra Azul Copper-Silver Project in Colombia, following a recently signed earn-in agreement with Freeport-McMoRan Exploration Corporation (“Freeport”), a wholly owned-affiliate of Freeport-McMoRan Inc. (NYSE:FCX).

The project was formerly known as CESAR.

Name change

Max says its management team decided to change the project’s name because the CESAR holdings represent a relatively small part of the sprawling property, which includes 188 square km of mining concessions and 1,141 km2 of mineral concession applications.

Sierra Azul, which means “Blue Mountain” in Spanish, comprises three districts: AM, Conejo and URU. Collectively the three contiguous districts stretch over 120 km in a north-northeast, south-southwest direction.

Earn-in agreement

Under the terms of the EIA , announced on May 13, Freeport has been granted a two-stage option to acquire up to an 80% ownership interest in the Sierra Azul Project by funding cumulative expenditures of CAD$50 million and making cash payments to Max of CAD$1.55 million.

Max Resource Executes Earn-In Agreement with Freeport-McMoRan Exploration Corporation for the Cesar Copper-Silver Project

To earn an initial 51% interest, Freeport is required to fund CAD$20 million of exploration expenditures at Sierra Azul over five years and make staged payments to Max totaling CAD$0.8 million. Max will remain the operator during this initial stage. Once Freeport earns its initial 51% interest, Freeport can increase its interest to 80% by funding a further CAD$30 million in exploration expenditures at Sierra Azul over five years and making staged payments totalling CAD$0.75 million.

Sierra Azul Copper-Silver Project

The Sierra Azul Project sits along the Colombian portion of the Andean Belt — the world’s largest producing copper belt. It includes the copper-silver-rich Cesar Basin. This region provides access to major infrastructure resulting from oil & gas and mining operations, including Cerrejon, the largest coal mine in South America held by Glencore.

Despite the Spanish being there centuries ago, tunneling into the mountains looking for high-grade silver, and the equally-long-known-about massive outcrops exposing high-grade copper and silver mineralization throughout the entire basin, Vancouver-based Max Resource, led by CEO Brett Matich, was the first to recognize its potential.

The land package now spans more than 1,150 km of geology prospective for sedimentary-hosted copper and silver deposits and includes 20 mining concessions covering over 188 square km.

AM District

The AM District starts in the far north of the Jurassic Basin; classic stacked red bed outcrops with extensive lateral continuity have been channel chip-sampled for over 15 km of strike. Highlight values of 34.4% copper and 305 g/t silver have been documented in the sedimentary sequences. The Company has confirmed that the stratiform red-bed style mineralization continues at depth with two scout drill holes. Max’s field crews have identified a 15-km mineralized corridor encompassing 14 priority targets (AM-01 to 14).

Max Resource Discovers New Copper-Silver Zone at the AM District CESAR Project

Max Resource Reports High-Grade Copper & Silver Assays from AM-7, at the CESAR Project

Conejo District

The Conejo District 40 km south of AM is the most recent to be recognized and is characterized by structurally controlled mineralization hosted in intermediate and felsic volcanic rocks. Numerous mineralized outcrops have been discovered over 3.7 km at the primary target in the district with surface samples averaging 4.9% copper (averaging all samples above a 2% cut-off). Two priority targets have been identified (CON-01 and O2). No drilling has been conducted at Conejo, but it has emerged as an area of focus for the Company.

URU District

The URU District is located approximately 60 km south of AM. Copper-silver mineralization is hosted in intermediate volcanic rocks and is structurally controlled. In-country field crews have identified a 20-km mineralized corridor encompassing 12 targets (URU-01 to 12). At URU-C, a 9.0m of 7.0% copper and 115 g/t silver surface discovery was confirmed at depth by drill hole URU-12, which intersected 10.6m of 3.4% copper and 48 g/t silver. At URU-CE, 750m to the east, 19.0m of 1.3% copper discovered in outcrop was confirmed by drill hole URU-9, which intersected a broad zone of copper oxide returning 33.0m of 0.3% copper from 4.0m, including 16.5m of 0.5% copper.

Drill Results of Max Resource Confirm High-Grade Copper Silver at the CESAR Project in NE Colombia. Highlights Include 10.6m at 3.4% Copper and 48 g/t Silver

2024 exploration

This week, Max announced the 2024 exploration program at Sierra Azul, funded by USD$4.2 million (CAD$5.8 million) of approved expenditures by Freeport-McMoRan Exploration Corporation, as per the May 13 earn-in agreement.

“We are leveraging Freeport’s global exploration team and expertise to unlock Sierra Azul’s potential, which we believe is host to one of the world’s largest underexplored sedimentary and volcanic copper-silver systems,” Max’s CEO Brett Matich said in the July 29 news release.

“The USD$4.2 million exploration budget to be implemented in the second half of 2024 is the largest annual exploration budget to date. We look forward to working with Freeport, one of the world’s largest copper producers, to advance our Sierra Azul Copper-Silver Project.”

The program has two main objectives:

• Conduct systematic regional exploration over the entire Sierra Azul project area of greater than 1,300 km;
• Define priority targets for drilling.

In terms of drill targets, the program will focus exploration on 28 targets that span 90 km over all three districts of the Sierra Azul Project: AM, Conejo and URU. Max says the work program has started and includes detailed geological mapping and soil sampling, as well as ground geophysical surveys and detailed structural analysis.

The two priority districts are AM and Conejo. AM is more advanced and prospective with 14 targets and potential deep-seated surface structures. Conejo is earlier-stage but thought to be at least as prospective as AM.

Max, the operator until Freeport earns a 51% interest in the project, is working through the approval-to-drill process.

The regional exploration program has been designed to systematically evaluate the entire Sierra Azul Project. Work will include the collection of up to 7,500 soil samples and up to 1,600 stream sediment samples. A regional structural analysis will be conducted, followed by geological mapping and prospecting to identify additional mineralized outcrops.

In February of this year Max completed a 10,000 line-km geophysical survey of the project. Magnetic and radiometric data were collected along tightly spaced lines, providing Max with two detailed data sets packed with geological information.

The fixed-wing survey targeted the La Quinta formation, a thick sequence of Jurassic-age (163 to 191 million-years before present) volcanic and sedimentary rocks in the Cesar Basin. Copper and silver mineralization has been discovered throughout the entire formation, but it is the sedimentary sequences that are of the greatest interest.

Radiometric surveys detect and map radiation from rocks and soils. The gamma radiation occurs from the natural decay of elements like uranium, thorium and potassium.

Magnetic surveys measure the spatial variations of the magnetic field. The results reflect the variations in the magnetic properties of the underlying rocks, and provide valuable information about their compositions and the structure of the Earth’s crust.

The idea is to match the areas of interest on the geophysical surveys with Max’s (surface) rock chip samples taken from outcrops throughout the three districts, and soil and stream sediment samples (geochemical surveys) conducted during this year’s exploration program.

High priority drill targets can be developed from overlapping areas of interest.

Funding

The 2024 exploration budget, in my opinion, is noteworthy. Freeport signed the Earn in Agreement (EIA) May 13^th 2024.

The budget is CAD$5.8 million for the 2024 annual exploration program at Sierra Azul.

Remember, to earn 51% of the project, Freeport must spend CAD$20 million cumulatively over 5 years.

The 2024 annual exploration announced CAD$5.8 million budget covers 2024. The new year, 2025, will bring a new budget, more exploration and drilling.

At AOTH we expect 2024 exploration news from Sierra Azul to pique interest

Max Resource Corp.
TSXV:MAX; OTC:MXROF; Frankfurt:M1D2
Cdn$0.06 2024.07.31
Shares Outstanding 176m
Market cap Cdn$10.5m
MAX website

Richard (Rick) Mills
aheadoftheherd.com
subscribe to my free newsletter

Richard owns shares of Max Resource Corp. (TSX.V:MAX). MAX is a paid advertiser on his site aheadoftheherd.com

This article is issued on behalf of MAX