The ownership of Konnex and the Empire Project is characterized by three agreements between ExGen and Phoenix: the Konnex Option dated July 15, 2015, the Supplemental Option Agreement dated November 9, 2016, and Supplemental Option Agreement No. 2 dated April 21, 2017. The terms of these agreements were fully satisfied as of June 29, 2017, establishing Phoenix’s 80% ownership of Konnex Resources, Inc., and ExGen’s 20% interest in the Project.
Summary:
Mineralization at the Empire Mine is representative of a polymetallic skarn deposit.
Copper-gold-zinc-silver mineralization at the Empire Mine falls into the skarn-hosted, polymetallic deposit type. In fact, historical results and mining records suggest that skarn mineralization at Empire may exhibit depth zonation with copper giving way to zinc and finally tungsten mineralization. The exact process of this zonation is as yet unknown. This skarn has been overprinted by a later epithermal event along pre-existing structures resulting in the gold and silver mineralization encountered.
Both copper-oxide (carbonates, malachite and azurite) and sulphide (chalcopyrite/chalcocite) mineralization is developed to varying degrees within exoskarn in rafted limestone fragments and endoskarn in porphyry. The copper oxide mineralization occurs as veinlets, stockworks, and disseminated oxide/sulphides. The sulphides have similar characteristics, but also occur as massive lenses, both copper sulphides and magnetite, along skarn-hosted fault breccias. In both breccia types, the degree of mineralization appears to be a function of the amount of contained skarn fragments. The copper and iron were apparently introduced into the skarn during the latter stages of the skarnification processes (Chang, 2003). Brittle faulting/shearing and ductile deformation during the skarnification process likely provided the conduits for mineralizing fluids. These conduits may be exemplified by magnetite breccia.
At the northern end of the property, mineralized zones dip eastward at about 45° to 90°, somewhat parallel to the limestone-porphyry contact (but cross-cutting the west-dipping limestone), At the southern end, in the vicinity of the AP Pit area, the dip of both exoskarn and mineralization ranges from 30° to 50° towards the east, suggesting that the skarn body may represent a detached raft of limestone.
Drilling has encountered a skarn-hosted body of disseminated and stockwork copper-oxide mineralization extending over a strike length of 1200 m, with a thickness of 6 m to 73 m from surface, and a width of up to 130 m. The “width” figure is a function of topography; the skarn is exposed along a steeply inclined north- trending ridge-crest, with the northern most outcrop being 255 m lower in elevation than the southernmost exposure. All of the mineralized intercepts are in endoskarn, exoskarn and skarn-hosted breccias. The mineralization intersected is oxidized from surface to a vertical depth of approximately 120 m, with sulphide mineralization dominating below that depth. The transition zone between oxide and sulphide extends over tens of meters.
The Empire Mine skarn is overprinted by a series of north-trending anastomosing faults which are represented by gossanous breccias, veins and stockworks up to several meters in width. Herein termed “FeOx breccias”, these structures consist of intensely clay-altered, chalky and brecciated wallrock (exoskarn, endoskarn and porphyry) cemented by siliceous limonite and goethite (sulphide derived iron-oxide?). Brecciation clearly post-dates skarnification. The breccias appear to have been affected by advanced argillic alteration (clay+pyrite+silica), and have open-space textures, both of which are strong epithermal signatures. These FeOx breccias are auriferous and represent a late stage, epithermal, gold-rich, hydrothermal regime overprinted upon the skarn. The copper in these epithermal structures may have been scavenged, in-part, from the pre-existing skarn.
The highest-grade mineralization at the Empire Mine occurs as a poorly defined, steeply dipping, locally iron- rich, 5 m to 15 m thick, copper-gold zone located within and below the large body of skarn-hosted disseminated copper mineralization. Drill core indicates that the skarn in this high-grade zone has been sheared, brecciated and overprinted with iron oxides (FeOx brecciation). This structure may have been active throughout skarn formation and may have been the major pathway for both the skarn-aged copper mineralization and the late-stage auriferous mineralization. In the deeper levels of the mine, this structure contains lenses and veins of copper-bearing massive sulphide. This higher-grade zone forms the bulk of the historical Empire Mine, which has been partially worked for 350 m vertically and 900 m laterally. The near- surface oxide mineralization is interpreted to remain open along strike. The higher-grade sulphide zone, which underlies the oxide zone, is open in all directions, and remains virtually unexplored.
The scale of the processes of skarn development and associated hydrothermal mineralization is characteristic of a large (3.5 km long by 40 to 150 m wide) skarn system flanking a poorly understood parent intrusive body measuring 3,500 m in the north-south extent and some 250 to 500 m in width (Maund, 2016). Previous exploration at the Empire Mine has primarily focused on a shallow copper oxide resource comprising a 400- m section of the 3,500 m length of the skarn body and has largely discounted or ignored supergene and sulphide Cu, Au, Ag, Zn, W mineralization.