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Projects

Kootenay Project

Overview

In late 2017 Cardero completed two option agreements for five nickel-cobalt properties in south eastern British Columbia (the "Kootenay Project" or the "Project") totalling approximately 8,000 hectares. In May 2019, this was reduced to a single option agreement for the 1444 hectare Lardeau claim block. The property is within the prospective Lardeau Group, which hosts numerous volcanogenic massive sulphide deposits, including the past-producing Goldstream mine located north of Revelstoke. Between 1983 and 1996 this mine produced 2.2 million tonnes of massive sulphides averaging 4.49% Cu, 3.24% Zn and 20g/t Ag. Other VMS prospects in the Lardeau Group near Goldstream include the Standard (Minfile 082M 166) and Montgomery (Minfile 082M 85) deposits.

Cardero believes the metavolcanic and metasedimentary units of the southern Lardeau Group to have excellent potential for hosting volcanogenic massive sulphides (VMS) with significant nickel-cobalt (± copper-zinc) content. These deposits have relatively small footprints and the other known VMS occurrences in the belt were either discovered in areas of good rock exposure, at high elevations, or by chance during construction of forestry roads. The heavily vegetated low-elevation regions are under-explored, and few previous workers recognized the potential for nickel-cobalt mineralization. Past exploration has focussed on lead-zinc- silver replacement and silver-gold vein deposits.

The Lardeau claim covers some of the most prospective of the anomalous nickel-cobalt regional silt anomalies produced by the regional sampling programmes of the B.C. Ministry of Mines. More details on each project are available at www.cardero.com.

Note that the exploration results described here for the Kootenay Project are preliminary in nature and not conclusive evidence of the likelihood of a mineral deposit.

Initial Discovery

The first documented occurrence of nickel-cobalt bearing massive sulphides in the region was the Ledgend showing, discovered by prospectors in 1981 during construction of a logging road. The showing was not subsequently staked until 1997. The mineralization was described in 1998 by the B.C. Geological Survey as outcropping massive pyrrhotite with nickel and cobalt minerals. The geologist noted that the mineralized horizon could be traced over hundreds of meters along strike. Subsequently largely overgrown, in 2016 the new owners relocated float from the discovery outcrop and grab sampling returned values of 0.15 to 0.76% nickel and 0.01 to 0.09% cobalt, as well as up to 0.53% chrome and anomalous copper and zinc. Subsequent work in 2016 included soil geochemistry covering an area 500 by 1600 metres at 25 metre spacing on 100 metre lines. This generated a nickel-cobalt anomaly 800 metres in length extending to the southeast of the showing, with the peak of the anomaly (values up to 0.84% nickel) located on a steep slope about 200 metres southeast.

Cardero completed soil sampling in fall 2017, under a previous option agreement, and expanded on the sampling completed in 2016 by the owners (the "North Grid") and added a second grid 1.8 kilometres to the south ("South Grid"). In addition, an outcrop near the original discovery was cleaned and chip sampled perpendicular to foliation, returning 4 metres of 0.22% Ni and 161ppm Co, with a one metre sample running 0.39% Ni and 0.028% Co. A 20-30cm layer of massive to semi-massive pyrite-pyrrhotite occurs between an upper horizon of siliceous biotite schist and lower horizon of talc-tremolite schist. True widths should be close to sample widths, but might vary significantly along strike due to the tight folding. The 1,218 soil samples produced significant anomalies for follow-up work in 2018, mainly in the North Grid.

A conformable and probably syngenetic horizon of manganiferous exhalite is associated with the massive sulfides located to date. Sampling intermittently traced this horizon throughout the length of the soil grid and beyond, from at least 400 metres to the north to some 4,500 metres to the south, where similar conformable sulfide mineralization occurs along a road cut. The northern portion of the claims covers two kilometres of the horizon's strike and remains untested due to limited access; work is planned there for fall 2018.

Chip sampling ICP results of the Creek Outcrop, with layer of semi-massive sulphide considered the source of the float at the Ledgend discovery showing.

Sample of massive sulphide from the Ledgend discovery outcrop.

Sample of massive pyrrhotote-pyrite from the Ledgend discovery showing.

Mineralization Model

The mineralization at Ledgend is hosted by northwest-trending, tightly folded sericite and biotite schists, quartzite, and talc-tremolite schist of the Index Formation, a member of the Lardeau Group. Graphitic and manganiferous layers are particularly anomalous in metals, and thought to be seafloor exhalatives generated by submarine hydrothermal fluids. The rock types and style of mineralization are most similar to the Outokumpu and Talvivaara districts in central and eastern Finland, where Cu-Zn massive sulphide mineralization is hosted by similar lithologies.

Cross Section of the Keretti Mine, Outokumpu VMS District, Finland

Ongoing study as to how shale associated, Ni-Cu-Zn-Co deposits form has led to recognition of oceanic detachment faults on the modern day ocean floor that have focused large volumes of black smoker fluids along an ultramafic - volcanic (or sediment) contact. This results in metasomatic alteration of ultramafics to talc-tremolite-chlorite schists along the fault. By this process, distal venting of Ni-rich fluids can form "VMS" deposits far from a spreading ridge, in or under quiet basins where shales deposit. If fault involves a sedimentary package, the fluids can precipitate subsurface, within graphitic shales or sandstone, which are later deformed and metamorphosed to black schist and quartzite.

Deposit model for mineralization in the Lardeau Group. Modified from Jowitt and Keays (2012): Shale-hosted Ni-(Cu-PGE) mineralisation: A global overview.

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