Goldcorp Strategic Alliance Projects, Central Mexico (Gold and Silver)
The Goldcorp Strategic Alliance combines the strengths of the teams that discovered and built the giant Peñasquito Mine in Zacatecas state, Mexico, and is focused on finding similar Peñasquito-type deposits. With Quaterra´s exploration talents and Goldcorp´s financial strengths and technical expertise, the partners are well positioned to discover and develop similar deposits.
The gold and silver prospects being explored through the Alliance are located in the heart of the Mexican Silver Belt (Faja de Plata) where Goldcorp´s Peñasquito gold-silver mine is located. Central Mexico has emerged as one of the world´s most prospective areas for major new precious metal discoveries, underscored by the fact that two of the world´s four largest silver resources (Peñasquito and Pitarilla) both occur in central Mexico and neither existed ten years ago. Peñasquito´s average annual production over the estimated 22 year mine life is expected to be approximately 500,000 ounces of gold, 28 million ounces of silver, 450 million pounds of zinc and 200 million pounds of lead at full capacity. As of December 31, 2009, reserves totaled 17.82 million ounces of proven and probable gold and 1.07 billion ounces of proven and probable silver. Several of the early-stage Quaterra properties have Peñasquito-type potential.
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The Investment Framework Agreement (IFA) signed by the companies provides Goldcorp with an option to acquire an interest in any mining properties held by or acquired by Quaterra in central Mexico (except the Nieves silver project) in return for funding a two year generative exploration program through a private placement investment of US$10 million in the Company. The terms of the option allow Goldcorp to acquire up to 65% in any property held by Quaterra by spending an additional US$2 million over a two-year period on advanced exploration on that property and by completing a feasibility study. Thereafter, Goldcorp will solely fund operations at the property until a production decision is made, at which point Quaterra will be responsible for contributing its proportionate share of expenditures. The IFA currently includes 12 properties covering more than 950 square miles in a favorable mining environment with a long history of production and well-developed infrastructure.
