International Property Acquisition Opens New Frontier for Tasca Resources

As an early stage junior exploration Company, Tasca Resources Ltd. (CA:TAC – $0.04 & US:ECMXF – $0.03 & GER:3TA – €0.02) so far had opted to focus close to home, with its property holdings located in Canada. However the prospect to acquire an excellent project further abroad has prompted the Company to change its strategy and this week Tasca reported that it has submitted a Letter of Intent with fellow Canadian junior MAX Resources Corp (MAX) to acquire an exploration asset in Colombia.

Tasca is now engaged in the process to acquire 100% ownership in 7 mineral license applications comprising the North Block of Max’s Gachala Copper project 60 km east of Bogota, Colombia. The large project area, spanning 13,280 hectares, covers a rock formation within an emerging exploration district that is attractive for the potential discovery of sedimentary copper deposits.

The North Block was formerly a part of the larger Gachala property, located within a promising exploration district in central Colombia known as the Sedimentary Copper Basin. While the entirety of the Sedimentary Copper Basin is considered underexplored, sporadic historic exploration activity has indeed presented a number of attractive discoveries.

Gachala Copper Project

The North Block consists of 7 mineral license applications covering 48 line kilometres of the Devonian – Permian / Cretaceous contact believed to be highly prospective for sedimentary copper deposits.

Appealing Early Stage Indications for Potential Copper Discovery

Historical exploration work completed by Rio Tinto Exploration for the Sinai Property, which covers the area immediately adjacent to two of the claims of the North Block, was reported several years ago yielding numerous rock samples bearing high grade values above 1% copper. While there is no certainty that these copper zones also extend onto the North Block property, Tasca management has expressed optimism that this disseminated copper in the sedimentary rock may also be encountered on the North Block holdings.

In addition, the Colombian Geological Survey has documented numerous copper occurrences within the main sedimentary formation of the district, including some historical references within the Gachala property area and others in close proximity to the North Block holdings. This information will be reviewed by the project geologists as Tasca prepares the preliminary exploration and fieldwork for the North Block, with the potential to verify any copper occurrences that may become focus points for future exploration targets.

There is also an indication for leverage to cobalt within the North Block. Two of the license applications cover an area where the Colombian Geological Survey has identified a cobalt anomaly spanning more than four kilometers in length. While a cobalt discovery itself would be a bonus, as the metal is currently in high demand, cobalt is also considered an indicator mineral that is often associated with sedimentary copper deposits and therefore it would represent a priority exploration target within the North Block.

The Colombian Sedimentary Copper Basin has many observed similarities with the productive Zambian copper belt of Africa, and this too bears mention. Underlying sedimentary rock formations that have been mapped in Colombia match up well with the stratigraphy of the Zambian geology that has contributed to the endowment of several large copper deposits. Therefore the other promising indications and historic copper showings that have been encountered through limited previous exploration work in Colombia may represent the initial confirmation of a new copper district for which Tasca is building a strategic land position.

North Block Transaction Terms and Pending Share Consolidation

A non-binding LOI has been submitted by Tasca with the offer to issue 6 million common shares to MAX Resources in settlement for the acquisition of the North Block license applications. This transaction would transfer 100% ownership of the property area to Tasca. The agreement is subject to regulatory approvals and closing conditions, including due diligence by both companies.

Tasca has made a strategic decision to complete a consolidation of its share capital on a one-for-two basis. The effect of this measure will be to reduce the total number of shares issued to about 26 million. The Company plans to complete this consolidation within 2 weeks, and thereafter the issuance of shares to MAX for the closure of the North Block transaction will be settled with post-consolidation shares.

Conclusion

The addition of a highly prospective property in central Colombia will open a new dimension for Tasca to continue with its exploration ambitions. Colombia represents an ideal jurisdiction for the Canadian junior to expand its strategic focus, as the country has been largely overlooked as a prime mineral discovery area despite the attractive geological setting and its significant historic production of base and precious metals. The opportunity to acquire the undivided ownership of a large claim group with promising early stage exploration potential for copper represents an important shift in the corporate strategy.

Management has expressed a positive bias towards building leverage for copper resource discovery. The Company already owns the Poplar copper deposit located in British Columbia, Canada, which hosts a historical indicated mineral resource of 131 million tonnes grading 0.31 per cent copper, 0.009 per cent molybdenum, 0.09 gram per tonne gold and 2.39 grams per tonne silver, and a historical inferred mineral resource of 132 million tonnes grading 0.27 per cent Cu, 0.005 per cent Mo, 0.07 g/t Au and 3.75 g/t Ag has been identified through the drilling of 147 historical holes.

Now Tasca will be working closely with geologists from Max to advance the initial phases of exploration at North Block. Plans are underway to commence aggressive exploration in this current year. The speculative appeal of a new project in what may become a high profile copper district, plus the pending commencement of an exploration program on this large property area, should contribute to upside momentum for the share price after Tasca completes this acquisition. Smallcaps Recommendation: BUY.

For important disclosures, please read our disclaimer.

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