Pan American Silver grants option to Patagonia
Gold to acquire Calcatreu deposit
All amounts are expressed in US$ unless otherwise indicated.
This news release contains forward-looking information. Readers
should refer to the risks and assumptions set out in the
"Cautionary Note Regarding Forward-Looking Statements and
Information" at the end of this news release.
VANCOUVER, April 25, 2017 /CNW/ - Pan American
Silver Corp. ("Pan American") (NASDAQ:PAAS; TSX:PAAS) today
announced a binding agreement whereby Minera Triton Argentina S.A.
("Minera Triton"), a wholly-owned subsidiary of Pan American, will
acquire 100% of Patagonia Gold's Cap-Oeste Sur Este project
("COSE") in the province of Santa
Cruz, Argentina, from
Patagonia Gold S.A. ("PGSA"), a wholly-owned subsidiary of
Patagonia Gold Plc ("Patagonia Gold") (the "COSE Transaction").
Total consideration for the COSE Transaction is US$15 million, of which US$7.5 million is deferred, plus a 1.5% net
smelter return ("NSR") royalty. The COSE deposit is situated 1.4
kilometres to the southeast of Patagonia Gold's Cap-Oeste deposit
in the province of Santa Cruz,
Argentina.
In addition, Patagonia Gold has been granted an exclusive option
to purchase from Minera Aquiline Argentina S.A., a wholly-owned
subsidiary of Pan American Silver, the Calcatreu gold-silver
project for US$15 million. The
Calcatreu deposit is a low sulphidation epithermal style
gold-silver deposit located 60 kilometres south of the town of
Ingeniero Jacobacci in the province of Rio
Negro, Argentina. The
option, exercisable at the discretion of Patagonia Gold, will
remain available for a period of six months, during which time
Patagonia Gold can complete its due diligence review of the
project.
The COSE Transaction is expected to close on or about
May 31, 2017. Upon closing, Minera
Triton will pay US$7.5 million to
transfer ownership of COSE to Minera Triton and will grant PGSA a
1.5% NSR royalty on production from COSE. The remaining
US$7.5 million will be payable either
12 months after the closing date or upon the commencement of
commercial production of COSE, whichever is the earlier. If
Minera Triton does not pay the deferred US$7.5 million to complete the acquisition, COSE
will revert to PGSA and Minera Triton will be entitled to retain a
3.0% NSR royalty on production from COSE.
"The COSE project is another high-grade satellite deposit
offering synergies with our Manantial Espejo mine, similar to our
Joaquin project acquired earlier this year," said Michael Steinmann, President and CEO of Pan
American. "The COSE project is within trucking distance of our
plant at Manantial Espejo, which has capacity to process feed from
both COSE and Joaquin. The addition of another satellite deposit
enables us to extract further value from our invested capital at
Manantial Espejo and provides another opportunity for future growth
in our silver production."
Mr. Steinmann added: "Calcatreu is a non-core asset for Pan
American and is a better fit for Patagonia Gold. We are pleased we
could reach an agreement that offers both parties the opportunity
to capitalize on our respective strengths."
About Pan American Silver
Pan American Silver Corp. is one of the largest primary silver
producers in the world. We own and operate seven mines across
Mexico, Peru, Argentina and Bolivia. Pan American also
owns several development projects in the USA, Mexico,
Peru and Argentina. Our vision is to be the world's
pre-eminent silver producer, with a reputation for excellence in
discovery, engineering, innovation and sustainable
development. The Company is headquartered in Vancouver, B.C. and our shares trade on NASDAQ
and the Toronto Stock Exchange under the symbol "PAAS".
Cautionary Note Regarding Forward-Looking Statements and
Information
This news release contains forward-looking statements or
information within the meaning of securities legislation in
Canada, including expectations for
the completion of the transaction between Patagonia Gold and Minera
Triton. These forward-looking statements and information reflect
Pan American's current views with respect to future events and are
necessarily based upon a number of assumptions that, while
considered reasonable, are inherently subject to significant
operational, business, economic and regulatory uncertainties and
contingencies. These assumptions include: customary closing
conditions being satisfied in a timely manner; the ability of Pan
American to complete the acquisition of COSE; and the future
exercise, if any, of the option relating to the Calcatreu property.
The foregoing list of assumptions is not exhaustive.
Such forward-looking statements and information also involve
known and unknown risks, uncertainties and other factors which may
cause actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements or
information. Such factors include, among others, the uncertainties
and risk factors set out in filings made from time to time with the
Canadian securities regulators. Actual results, developments and
timetables could vary significantly from the estimates presented.
Readers are cautioned not to put undue reliance on forward-looking
statements or information. Pan American disclaims any intent or
obligation to update publicly such forward-looking statements or
information, whether a result of new information, future events or
otherwise, except to the extent required by applicable law.
Additionally, Pan American does not undertake any obligation to
comment on analysis, expectations or statements made by third
parties in respect of the content of this news release.
SOURCE Pan American Silver Corp.