Dragons Tail is a porphyry copper project in the Superior Mining District of Arizona, approximately eight kilometers north of the Resolution copper deposit and five kilometers southwest of Pinto Valley. EMX has a Regional Strategic Alliance agreement, through its wholly owned subsidiary Bronco Creek Exploration, Inc. (“BCE”), with South32 Limited (“South32”) covering Arizona, New Mexico and Utah, but excluding South32’s Hermosa project in southern Arizona. The Agreement provides funding for generative work and property acquisitions, as well as a framework to advance projects of interest. Under the terms of the Agreement, which has an initial term of two years, South32 will provide annual funding for generative work performed by EMX personnel to identify properties for exploration work (“Alliance Exploration Properties” or “AEPs”). EMX personnel will conduct exploration on AEPs with additional funding from South32 in order to identify drill stage projects as Designated Projects. Designated Projects will advance under separate option agreements providing for work commitments and cash payments to EMX during South32’s earn-in period, and upon earn-in, a 2% net smelter return (“NSR”) royalty interest and pre-production and milestone payments to EMX’s benefit. (see Company news release dated December 6, 2018). Dragons Tail has been selected by South32 as an initial AEP.
At Dragons Tail, EMX identified a 1.6 kilometer long zone of quartz-sulfide alteration within Proterozoic sedimentary rocks during reconnaissance work. The outcrops of quartz-sulfide veining lie beneath tilted Tertiary age volcanic and conglomeratic cover rocks. Historic drilling on the east side of the property intercepted transported copper-oxide mineralized clasts within Tertiary conglomerates, which suggests the source of the copper lies to the west of the drilling and likely down dip of the mineralized exposures.
Note: The nearby mines and deposits in the region provide geologic context for EMX’s Project, but this is not necessarily indicative that the Project hosts similar mineralization.