Chakana Copper (TSX-V: PERU) CEO David Kelley on High-Grade Channel Sampling Results & Upcoming Drill Results from the Soledad Project in Peru

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Chakana Copper (TSX-V: PERU)(OTC: CHKKF), Mr. David Kelley. Dave, how are you?

David Kelley: I'm doing great Gerardo. How are you doing?

Gerardo Del Real: I am well. I want to thank you ahead of time for jumping on the call on short notice. You had a release that, like many of your releases, is very thorough and detailed and technical in nature. I wanted to have you on to kind of walk us through it. The headline reads, “Chakana Provides Surface Channel Sampling Results for Breccia Pipe 1 and Breccia Pipe 6 from the Soledad Project in Peru.” Can you give us a good overview of the news today?

David Kelley: Yeah. That's the first of a series of channel sample results that we will have coming out. We're focusing on the breccia pipes that we drill that will be included in a resource estimate. The reason for the channel sampling is that when you are drilling these breccia pipes, you have two options. You can either get in the center of the breccia pipe and drill radially away from a central platform, or you can step away from the breccia pipe and drill across it. But either way you end up with a large part of the top portion of the breccia pipe that's unrepresented with sampling, just due to the nature of the angles of the drill hole where it intercepts a breccia pipe.

In order to have that material included in the resource, you have to sample it. That's why we take advantage of the fact that we've got good exposure of these breccia pipes, get out and do the channel sampling. Essentially it's like a drill hole, right? It's the same width as a drill hole. It's the same sample volume. If the exposure is good, we can get decent, continuous samples. 

I think the one that we quoted was 17 meters continuous channel sample on Breccia 1 with 9.9 grams per tonne gold and 234 grams per tonne silver. So a really, really strong, excellent result confirming what we already knew, that Breccia Pipe 1 is very strongly endowed with gold and silver in the top portion of the breccia pipe.

Gerardo Del Real: Impressive numbers for Breccia Pipe 1. Can you go over Breccia Pipe 6 and the results there?

David Kelley: Yeah, the results over Breccia Pipe 6 were a little bit surprising. We know from our drilling that there's good gold mineralization in Breccia Pipe 6. We also know from our drilling that the breccia pipes have variable grades, both vertically with elevation and laterally within the extent of the breccia. As it turns out the exposure level where breccia pipe is eroded to and exposed at surface, that's not a strong gold-bearing zone. It was very consistent. All the samples had very consistent gold, but it was relatively low level, around 0.2 grams per tonne, I believe. That's just an indication of that particular elevation level and what the gold grade is at that particular level.

If you look at the drill results we published on Breccia 6, there are good, long runs of decent gold mineralization in 6. We can't put too much weight in it. It's important to have those results to make the resource estimate as accurate as possible. You do the work, you be systematic and be thorough in the way you did your work and then the results are robust and we can use them. You take the good, strong results and you take the regular results and you move forward.

Gerardo Del Real: You're being modest on the drill results from Breccia Pipe 6, Dave. The intercept was 90 meters of 0.88 grams per tonne gold and 84.7 grams per tonne silver from 10 meters depth. So that's darn near, near surface. Those are excellent numbers.

David Kelley: Yeah, they really are. That's my point. If this breccia pipe had been eroded down 10 meters more, then the gold expression at surface might be a lot different. Like I said, I would have loved to have seen higher numbers, but I'm super impressed with what we see at Breccia Pipe 1. We had historic grab samples on the top of Breccia Pipe 1 that had 360 grams of gold in a single sample. That's 10 ounces per tonne, right? That's really spectacular. We hit 28 grams in our channel sampling and we hit, I believe our highest drill result in Breccia 1 is 42 grams. 

There's some really super high grades in these breccia pipes and it does take a lot of sampling, a lot of drilling to really exploit those zones of high grade and really figure out what's controlling them. We often know it's the margins of the breccia pipe that are really high grade and these channel sampling results, again, showed that as you get closer to the margin, you get higher grades.

Gerardo Del Real: You mentioned drilling. We're all excited as I know the Chakana team is with the drill program and how it's advancing. When can we expect assays on the next set of results?

David Kelley: They should be out soon. We've had a little bit of a further delay. The turnaround times dropped off a little bit with the lab. We split our batches of samples into smaller batches of 150 samples. It's the optimal batch size for the laboratory to get the results through the lab as soon as possible. You can imagine with hundreds of meters of drill core to be assayed, you've got multiple batches per drill hole and that type of thing on the longer holes. So it's taken a little bit longer, but they're making good progress.

What I watch keenly is the performance of the QA/QC and the laboratory and whether or not our standards and blanks and duplicates are performing well and they've done a great job. For me, it's quality first, and then it's quantity second. I'd much rather see them take a little bit more time, get reliable results and then we can take those results and use them and move on and not have to go back and re-assay certain intervals or batches of samples, that type of thing. This stuff is so important, the assays. You really have to stay on top of the quality and so far the labs done really well for us.

Gerardo Del Real: Excellent. Dave, I'm looking forward to assays. I can't wait to have you back on to discuss them and thank you again for the detailed update today.

David Kelley: Absolutely. Gerardo, we'll do it again soon. Thank you.

Gerardo Del Real: Appreciate it, thanks.