Overview

The Agusan Project (“Agusan”) is a 16,200-hectare epithermal porphyry copper-gold prospect in the Municipality of Jabonga, Agusan del Norte, all within the Surigao Mineral District of Eastern Mindanao Province. The project comprises one Exploration Permit Application (“EXPA-0001-X”). Geograce Resources Philippines Inc. manages the property under a deed of assignment with original claim owner (Dopester). The property covers an area of 16,200 hectares and is currently under the Mines Adjudication Board of the Department of Environment and Natural Resources for resolution of conflict.

The Agusan copper-gold prospect lies within the Municipality of Jabonga, Agusan del Norte, all within the Surigao Mineral District. With the discovery of the Boyongan prospect by Anglo-American in 2000 plus the occurrence of other prospective sites in Agusan and Surigao del Norte, the area is considered to have great potential with regards to porphyry copper and epithermal gold mineralization. Anglo-American and other companies around the Lake Mainit area are now pursuing active exploration, as there are indications of similarly occurring porphyry copper bodies adjacent or peripheral to the Boyongan Prospect. In the claim area of Geograce, just south of Siana, gold mineralization is associated with subvertical, lenticular limestone bodies adjacent to a strongly argillized and pyritized quartz andesite porphyry stock. The limestone bodies are conceivably the same as those along strike at Siana.

The key promising features of the property are:
• Integrated (Au, Ag, Cu and Zn) anomaly area of southeastern tributary in Puyo River was noted during the Philippine-Korea Joint Investigation Project in Malimono–Cabadbarana area of the Surigao Mineral District.
• Historical gold and copper mines within the region.
• Intensive historical regional sampling and mapping including within the Geograce tenements.
• The established association of gold and copper mineralisation with nearby, large, diorite intrusive bodies (Asiga diorite).

The property is within the southern part of the Surigao Mineral District and is managed by Geograce under a deed of assignment with Dopester since 2006. The area lies approximately 48 kilometers north of Butuan City, and is accessed year round via the Maharlika national highway that links Butuan and Surigao City. Previous exploration activities as conducted by United Nation Development Program and RP-Korea Joint Exploration Project disclose integration of geochemically anomalous zone/areas. In addition to gold and copper possibilities, other base and precious metal mineralization, as well as other metallic deposits, are also prospective and warrant serious consideration.

It is approximately located between Surigao and Cabadbaran in the northernmost part of Mindanao. Jabonga can be reached most conveniently via 1 and ½ half plane ride from Manila to Butuan City, the provincial capital of Agusan del Norte. The area is approximately 48 kilometres North of Butuan City and is accessed year round from Butuan City via Maharlika National Highway that links Surigao and Butuan City. Thence, from Jabonga, the property is accessed by roads of variable grade, from concrete paved ones to seasonal dirt roads that are serviceable only during the dry season. Most of these dirt roads are former logging roads that are accessible only either by 4-wheel drive vehicles or motorcycles.

The Jabonga “Dopester” prospect is situated within the Eastern Highlands, which is considered as one of the three dominant physiographic units in the province of Surigao del Norte and northern parts of Agusan del Norte. The Eastern Highlands extend southward and forms part of the East Mindanao Ridge also known as Diwata Range. The Eastern Highland is drained by three major river systems namely, the Puyo, Asiga and Cabadbaran rivers. The Puyo River, which drains most of the project area, flows generally westward to the Central plain. Puyo River is the most extensive with its headwaters extending up to the ridge limits of the Eastern Highlands. The Puyo River is characterized by dendritic to rectangular drainage pattern with many straight stretches that appear to be controlled by fractures and faults.

Agusan del Norte lies on the edge of the typhoon belt and located along the path of both the Northeast and Southeast monsoons. Most of the rainfall occurs during the NE monsoon, from October to January with an average precipitation of about 600mm. April and May are relatively without measurable rainfall. Overall temperature shows almost constant ranging from 25 to 29ºC. Vegetation of the survey area is characterized mostly by second growth tropical forest. The central plains are mostly cultivated to rice, corn, fruit crops and coconuts.

The earliest geological survey made in Surigao and Agusan were done in 1940 – 1941 by the MGB. The geology of the area has been described in unpublished report of Santos et al., (1962), in which the two published 1:50,000 scale geological maps of the Surigao and Agusan del Norte by MGB were based. The Mines and Geosciences Bureau, with its project with the United Nations Development Program (UNDP) undertook a reconnaissance geological mapping of Surigao del Norte and the Northern part of Agusan del Norte in the 1980’s. In general, they identified a stratigraphic succession similar to that of Santos et al (1962) but with modifications on nomenclature and on some age assignments of certain rock units. In December 2002, a joint cooperative investigation project is Malimono-Cabadbaran area of the Surigao Mineral district was undertaken by the MGB and Korea Resources Corporation. According to the result of the geochemical survey, several integrated anomalies of Au, Ag, Cu and Zn were detected and delineated in the Malimono, Alegria, Santiago and Cabadbaran Areas.

The Agusan copper-gold prospect of Geograce Resources Philippines, Inc. lies within the Municipality of Jabonga, Agusan del Norte, all within the Surigao Mineral District. And with the discovery of the Boyongan prospect by Anglo-American in 2000 plus the occurrence of other prospective sites in Agusan and Surigao del Norte, the area is considered to still have great potential with regards to porphyry copper and epithermal gold mineralization. Anglo-American and other companies around the Lake Mainit area are now pursuing active exploration, as there are indications of similarly occurring porphyry copper bodies adjacent or peripheral to the Boyongan Prospect. In the claim area of Geograce, just south of Siana, gold mineralization is associated with subvertical, lenticular limestone bodies adjacent to a strongly argillized and pyritized quartz andesite porphyry stock. The limestone bodies are conceivably the same as those along strike at Siana.

The prospect area lies south of the Surigao Gold District (BMG, 1982). Basement rocks reported in the area include metamorphosed conglomerates, sandstones, slates, serpentinized peridotites, meta-diorites and marbles that are mainly disposed on the western side of the peninsula. Overlying these rocks to the east are Paleogene basaltic flows and agglomerates with intercalated clastic sediments, essentially shales and limestone with minor thin coal seams of the Bacuag and Mabuhay formations (Santos-Yñigo, 1994). Intruding these rocks is a series of small andesite stocks and dikes. Younger volcanic flows, breccias, clastic sediments and limestone also overlie the older rocks (BMG, 1982). Two roughly parallel faults, the Surigao Valley Fault east of Lake Maiinit and the Mainit Faut on the west, trend north-northeast. Sympathetic high-angle northeast and northwest shear faults and east-west tension fractures serve as the main loci for quartz vein formation and gold mineralization.

Among the pre-war mines in the district are the Mabuhay Mine, East Minadanao, presently the site of Manila Mining Corporation’s Placer Gold Project; Mapaso Gold Fields; Lakandula and Kilometer 73 Mines in Masapelid Island; and Siana Mine, mined by Surigao Consolidated Mining Company, Inc. and the Agusan Gold Project in Cabadbaran, Agusan del Norte.

The Dopester, Jabonga tenement lies within the Malimono-Cabadbaran area of the Surigao Mineral District, Mindanao Island. The property is underlain by Bacuag formation and affected by North-northeast trending folds that plunge towards the northeast. The faults and lineaments in the area have a general North-northeast to North-northwest orientation. Generally, the mining claim is underlain largely by basaltic to andesitic volcaniclastic and volcanic materials, and their coarse sedimentary breccia derivatives of the Bacuag Formation. Intercalated with the volcaniclastics are pillow basalts reflecting the marine depositional environment of Bacuag Formation. Early reports (e.g., Santos, 1962) also indicated some limestone interbeds. The pillow basalts are generally highly vesicular with amygdales of chlorite, quartz or Zeolit; pillow range up to 1.5 m in diameter, with interstices commonly of green silicified mudstone.

Alteration is mainly silicification, argillization and pyritization that were encountered in the northwest branch of Puyo River. The regional distribution of such alteration is not clearly identified due to rarity of good outcrop. Alteration appears to be concentrated around fracture zones in andesitic tuff of Bacuag formation. However, according to the result of regional geochemical survey conducted by Korea Resources Corporation (KORES) and Mines and Geosciences Bureau of the Philippines (MGB) delineated integrated anomalies of (Au, Ag, Cu and Zn) at southeastern tributary in Puyo River. These integrated anomalies should be considered as of interest for more detailed survey and better understanding of Gold (Au) and Copper (Cu) mineralization potential.

Mineralization consists chiefly of pyrite-chalcopyrite impregnations diffused sporadically in the metavolcanic rock and disseminated on the quartz diorite porphyry intrusives. Quartz-pyrite veinlets ranging from one to ten centimeters width cut the metavolcanics. The veinlets carry mostly pyrite with minor chalcopyrite and possibly gold. Oxidized green copper minerals, mainly malachite, are common in the metavolcanic and diorite contact with Magnetite and rutile as accessory minerals.