This article is a sponsored feature from Mining.com.au partner Questcorp Mining Inc. It is not financial advice. Talk to a registered financial expert before making investment decisions.
Just as pace, track conditions, jockey and distance are all important factors when picking which horse to back in a race; location, management and the right partner are key to choosing which explorer to take a stake in.
Having previously taken a junior company through the ranks to success and assisted several other private and public companies, Saf Dhillon is no stranger to what it takes to win the race.
Dhillon, now CEO of Canadian explorer Questcorp Mining (CSE:QQQ), has been involved in the development of public companies for over two decades. He was a key figure in the evolution of Idaho-based US Geothermal from a US$2 million ($3.1 million) startup on the TSX to a US$450 million independent renewable energy producer graduating to the NYSE.
He is also a founding director of Torrent Gold (CSE:TGLD) and a director of lithium explorer Lake Winn Resources (TSXV:LWR).
Dhillon’s expertise in identifying promising projects led to Questcorp recently securing an opportunity to acquire a gold-rich patch of ground in the Sonora Gold Belt of Mexico, which is host to the majority of known orogenic gold deposits in the country.
In early May, Questcorp inked an option agreement with Riverside Resources (TSX-V:RRI) to earn a 100% interest in the La Union Gold Project in Sonora, Mexico.
This is in addition to the North Island Copper Property in British Columbia that it already owns and has multiple documented copper occurrences just north of BHP’s (ASX:BHP) past producing Island Copper mine.
“I think investors generally look for two key things. Who’s the jockey? The management team and board of directors,” Dhillon tells Mining.com.au.
“And then the horse. We actually think we’ve got two horses in this race. One of them could win us the regional derby, and then one of them could win us the grand prize, the Kentucky Derby.”
While the North Island Copper Property was originally Questcorp’s flagship project and the asset that the company completed an IPO on, Dhillon believes La Union is a much larger potential target.
“Some of the largest deposits as well as mines under production are within this belt in this region,” Dhillon explains.
La Union: Historic riches and modern promise
In proximity to La Union is the Noche Buena, La Herradura and Cerro Colorado mines.
The Noche Buena mine produced over 1.4 million ounces of gold over its 10-year life and generated total adjusted revenue of US$1.9 billion from 2012 to 2022.
La Herradura, meanwhile, is one of Mexico’s largest open pit gold mines, producing 360,598 ounces of gold in the 2024 financial year and still hosting reserves of 5.5 million ounces and resources of 6.7 million ounces.
Questcorp’s new joint venture partner via the La Union earn-in, Riverside Resources, is headed up by Dr John-Mark Staude, who has spent over 30 years exploring this gold fertile region in Mexico as well as parts of South America. He has held positions with international majors like Kennecott, BHP and Teck Cominco.
The broader Riverside team, which will continue to oversee the exploration programs at the La Union Project during the earn-in period, has a history of success in Mexico, including with companies like Alamos Gold (NYSE:AGI) – which is now a US$11.5 billion company – and Ocampo, which was sold for US$2.2 billion.
“Riverside has actually been consolidating a bunch of smaller claims into this pretty significant claim block that we’ve just signed the deal on,” Dhillon notes.
“They’ve been working on this for seven plus years and, collectively between them and the other companies who’ve worked in this region on these claims, they’ve put in about US$2.5 million.
“A small portion of our property actually has historically produced approximately 50,000 ounces of high-grade gold, ranging between 7 to 20 grams per tonne. It’s a very prolific region.”
Riverside consolidated seven individual properties, some of which have past production.
Potential game-changer
Questcorp says the project now has the potential for a major discovery such as Hermosa to the north, Cananea – which is considered the largest copper porphyry in Mexico – to the east, and Santa Lana to the south-east.
High grades of gold up 83.2 grams per tonne and zinc up to 30% have been returned from grab samples.
Riverside now also has a vested interest in Questcorp, having acquired an initial 9.9% stake as part of the staged sale of La Union and by the end of the four-year deal will own 19.9%.
At the same time, investors showed particular interest in the earn-in deal, with Questcorp’s C$1.5 million capital raising closing oversubscribed at C$2.7 million.
Riverside has been exploring La Union since 2019, identifying eight target zones. Three are drill ready and permitted and will be the immediate focus of the upcoming exploration program.
The phase-one program will comprise 10 holes drilled down to an average depth of 300m to test the Plomito, La Famosa and La Union targets. Other work to be undertaken includes gravity and electromagnetic surveys at Target 1 and the continuation of exploration at the remaining five targets to advance them to drill-ready status.
The Plomita target previously returned up to 83.2g/t gold, 176g/t silver, 3.85% lead, 19.8% zinc and 5.34% copper. The La Famosa target returned grades of up to 59.4g/t gold, 833g/t silver, 5.8% lead and 4.2% zinc, while the La Union target registered up to 9.9g/t gold, 53.6g/t silver and 2.5% zinc.
The La Famosa and Union underground mines were operated during the 1950s by a subsidiary of Peñoles. The operation hosted two identified ore bodies – Sproul and Emma – with the mining of eight levels generating 1 million tonnes of ore averaging 7-20g/t gold, 300g/t silver, 10-20% lead and 5% zinc.
Positioned for dual-discovery success
“We love our project on Vancouver Island, the North Island Copper property, but we think that we have now a serious contender to be a potential company maker in La Union,” Dhillon says.
To the west of Questcorp’s North Island Copper property sits Northisle Copper and Gold’s (TSX-V:NCX) major multi-million-ounce equivalent polymetallic discovery.
Northisle Copper and Gold is exploring several deposits and zones to the west of the North Island Copper property, with resources currently defined for the Red Dog and Hushamu deposits. These two zones are located 15km to 31km to the west from Questcorp’s project in the same suite of rocks.
“They have basically proven a massive resource a stone’s throw from our property,” Dhillon says.
The North Island Copper property is also bordered to the north by the Island Copper mine that produced around 1.2 million tonnes of copper and 1.2 million ounces of gold under BHP’s ownership.
“So we think that the North Island Copper property is a very prospective property,” Dhillon says.
“We’re waiting on a work permit and that should be, I’m hoping, received within the next couple of weeks. It’s very imminent. We’d like to get to work there.”
Questcorp’s exploration at the North Island Copper property is focused on the Marisa porphyry target to the west, where an historical induced polarisation survey identified a chargeability high and two of five holes in follow-up drilling intersected significant, shallow copper mineralisation.
The next phase of exploration will include a three-dimensional induced polarisation survey followed by an initial drill program.
With Questcorp keen to hit the ground running at both projects, Dhillon says investors can expect to see steady and “hopefully positive” news flow from both sides of the border.
Write to Angela East at Mining.com.au
Images: Mining.com.au & Questcorp Mining
