Bocana Resources Corp. (TSXV: BOCA) (Frankfurt: VC1)
("
Bocana" or the "
Company") – is
pleased to announce that it has signed a non-binding Letter of
Intent ("
LOI" or "
Agreement"),
dated March 25, 2024, for the proposed acquisition of all of the
outstanding shares (the "
Transaction") of Empresa
Minera Inti Raymi S.A. ("
INTI RAYMI"). The sole
INTI RAYMI asset is known as the Kori Pakaska project (the
"
Project").
The Transaction
INTI RAYMI is a privately held Bolivian company
with the head office in La Paz, Bolivia and is in good standing
with the laws and regulations of Bolivia. The privately held
concessions of INTI RAYMI, which include two former open pit mines,
dumps and tailings stockpiles and historical processing and mining
facilities, are located between the mining districts of Oruro and
La Joya in the Bolivian Altiplano, located approximately 200 km
from the city of La Paz and 45 km from the city of Oruro,
Bolivia.
Pursuant to the LOI, Bocana may acquire a 100%
ownership interest in INTI RAYMI, through the acquisition of all of
the outstanding shares of INTI RAYMI (the "IR Shares"). In
aggregate, the parties have agreed that the purchase price for the
IR Shares shall be up to a total of US$75,000,000 (subject to
adjustments to be described in the Definitive Agreement (defined
below), which shall include all assets associated with the Project,
equipment, land, records, data, etc. of INTI RAYMI (the
"Purchase Price"). The Purchase Price is expected
to be paid as follows: (i) a cash down payment of US $3,000,000
upon the closing of the Transaction (the "Down
Payment"); and (ii) the balance of the Purchase Price to
be financed by INTI RAYMI shareholders to be satisfied through the
expected monthly cash flow, at terms to be negotiated in the
Agreement.
BOCANA and INTI RAYMI will undertake to
negotiate the Definitive Agreement within one hundred twenty (120)
days following execution of the LOI, or such later date as the
parties may mutually agree, and subject to the results of the due
diligence investigations to be conducted by the Company. Such
agreement is to be in form and substance satisfactory to the
parties, including representations and warranties to each party
customary in transactions of this nature and the agreed upon
schedule of payments for the purchase of the subject Project owned
by INTI RAYMI.
The LOI is not intended to be a legally binding
agreement, but rather is an expression of the parties’ current
intent. The LOI remains subject to Bocana's ability to secure the
financing for the Down Payment to initiate the Transaction.
The transactions contemplated by the LOI are
subject to the following conditions:
a) the entering into
of a definitive share purchase agreement in respect of the
Transaction (the "Definitive Agreement") by the
shareholders of INTI RAYMI and Bocana. The Definitive Agreement
will describe the terms and conditions upon which the Transaction
will be completed;
b) the entering into
of the Definitive Agreement will be subject to the prior approval
of the boards of directors of each of Bocana and INTI RAYMI;
c) the completion of
a financing by Bocana for gross proceeds of up to $7,000,000, with
the offering structure to be determined in the Definitive
Agreement;
d) the completion of
satisfactory due diligence by Bocana; and
e) approval of the
TSX Venture Exchange.
The parties are in the process of negotiating
the terms of the Definitive Agreement and will issue news within
the next 4 months updating the terms of the Transaction once a
Definitive Agreement is reached. In the event a Definitive
Agreement is not reached, Bocana will notify shareholders and the
LOI will end, without penalty.
The previously reported announcement of the
commissioned NI 43-101 technical report for Huiracocha
International Service SRL, a wholly owned subsidiary of the
Company, entitled Technical Report For the Kori Pakaska Project,
Bolivia, prepared by Rae-co Consulting Ltd. of North Vancouver, BC,
Canada, dated October 22, 2022, and revised January 8, 2024 (the
“Technical Report”) was further updated and
provides an in-depth study of INTI RAYMI’s previous mining
operation that still contains extensive historical in situ,
tailings and stockpile resources. With the successful completion of
the Technical Report, the Company plans to continue its
metallurgical studies of the Project in order to determine the most
optimal production operations with the objective of increasing the
recovery of gold and silver from the large quantity of tailings and
minimizing production costs for optimal staged production.
History and Background of INTI RAYMI and
the Kori Pakaska Project
In 1980-1984 INTI RAYMI started an open-pit
operation and installed a plant with a treatment capacity of 400
tonnes/day. They installed a pilot plant under the heap leach
method and subsequent recovery of noble metals with the Merrill -
Crowe process to treat 400 metric tons per day in the San Andrés
sector in 1985. By 1986-1987 the San Andres plant increased its
capacity to 1,000 tonnes/day, and in September 1987 the treatment
reached 2,000 tonnes/day with a production of 44 Kg Au per month.
In 1988 Battle Mountain Gold Company joined as a partner and a
capacity parallel to San Andrés of 2,000 metric tons per day at the
Chuquina plant. In November 1990, the feasibility study for
open-pit mining and the new process for the treatment of sulphide
minerals were completed.
In 1998–1999, the sulfides of the deposit called
Llallagua were investigated with pre-treatment by bio-oxidation. By
1995, the plant’s capacity reached an average of 776 tonnes/hour
compared with the design of 641 tonnes/hour. In 2001-2003, Newmont
Mining Co. merged with Battle Mountain Gold Company, and became the
major shareholder. The oxides project for heap leaching began in
July 2001, with a treatment capacity of 15,000 tonnes/day. In 2003,
the environmental rehabilitation of the tailings dam began and the
Kori Kollo Lake filling and ecological rehabilitation of the
sterile material deposit was completed.
Historic production records from 1993-2003
indicate the Kori Pakaska, dry stacked, tailing dam facility
contains 65,919,472 tonnes of processed, mainly hypogene
mineralization.
Table # 1 provides the location, length, and
assay results from 32 historic drill holes completed on the
tailings. The assay results indicate the tailings dam facility to
have an average grade of 0.56 and 7.17 grams/tonne gold and silver
respectively.
These drill holes were vertical, and the
interval lengths represent the true thickness of the tailings.
Figure 1 outlines the extent of drilling completed on the tailings
deposit.
Figure
# 1 Drill Hole Locations – Kori
Pakaska Area |
Table
# 1 Assay Results: |
|
|
|
|
Between 1985 to closure 2009 a total of 135,875,535 tonnes of
ore were processed averaging 1.37 grams/tonne gold and 11.21
grams/tonne silver. A final resource study was completed after
production and Table #2, below, outlines the remaining historical
reserves/resources estimates from the tailings and low-grade dumps.
This was last updated in July 2018 by staff from INTI RAYMI, and
the suggested metallurgical process to get the maximum
recovery.
|
RESERVE/RESOURCE |
TONNES |
Au g/tonne |
Agg/tonne |
CONTAINED OUNCES
Au |
CONTAINED OUNCES
Ag |
SUGGESTED METALURGICAL
PROCESS |
Kori Kollo
DumpOxides |
Proven reserves |
103,400 |
0.73 |
13.98 |
2,427 |
46,475 |
Heap leaching |
|
Probable resources |
112,282 |
0.65 |
13.54 |
2,346 |
48,879 |
Heap leaching |
|
Inferred resources |
449,557 |
0.53 |
9.09 |
7,632 |
131,408 |
Heap leaching |
Kori Kollo
DumpOxides
Total |
|
665,239 |
0.58 |
10.60 |
12,405 |
226,762 |
|
Kori Kollo
DumpSulfides |
Inferred resources |
32,500,000 |
0.70 |
|
731,435 |
|
Milling -
leaching
byagitation |
Table # 2 – Kori Kollo Dump
Area
A qualified person has not done sufficient work
to classify the historical estimate as current mineral resources or
mineral reserves; and the issuer is not treating the historical
estimate as current mineral resources or mineral reserves. The
estimates were created by in-house staff, some of which with
previous experience when in operation. Full details on the
relevance and reliability were not provided.
A professional geoscientist, in October 2022,
collected representative rock samples of the ore material processed
at the mine site as shown on Figure # 2 below. This shows the
locations and assay results of the samples collected by the author
of the 43-101 Technical Report. All sample sites were randomly
selected and collected by the professional geoscientist from the
Dump Area and were geotechnically and geologically logged,
photographed, and then bagged, sealed, and numbered in order to
maintain a chain-of-custody. Blanks, duplicates, and a certified
standard sample were inserted prior to delivery to the independent
laboratory site of Activation Laboratories Ltd., located in
Kamloops, British Columbia, Canada. Activation Laboratories
provided the Company with sample preparation and analysis services
at its SCC accredited facility.
Figure # 2
Of note the cover rock in the Dump Area appears
to also contain gold mineralization, as detailed in the Technical
Report.
"The potential acquisition of INTI RAYMI’s
tier-one properties will mark a significant milestone for our
Company and is expected to bring tremendous value for Bocana and
our shareholders going forward. We are excited about the
opportunity of moving into a production and processing phase of the
business and the potential of bringing significant cashflow to our
operations from just reprocessing the tailings and low-grade dumps
that still have historically remaining reserves/resources." said
Tim Turner, Bocana’s Chief Executive Officer.
The Transaction is not subject to a finder’s
fee, however finder's fees may be paid in connection with any
capital that is raised in connection with the Transaction. The
agreement was negotiated at arm’s length. The transaction does not
represent a change of business. There will be no change of
directors or officers of the company required by the
transaction.
The TSX Venture Exchange has in no way passed
upon the merits of the Transaction and has neither approved nor
disapproved the contents of this press release.
Qualified Person
Mr. Lorne Warner, P.Geo., is a "Qualified
Person" as defined by National Instrument 43-101. Mr. Warner has
approved the scientific and technical information included in this
news release for dissemination.
About Bocana Resources
Corp.
Bocana is a mineral exploration company focused
on the acquisition, exploration, and development of mineral
properties in South America. Bocana, through its wholly owned
subsidiary, Huiracocha International Service SRL, holds a 100%
working interest in the mineral properties known as the Escala area
concessions located at the Department of Potosi, Sud Lipez
Province, Bolivia as awarded by Comibol.
Contact Information
For more information on Bocana, visit:
https://bocanaresources.com.
For more information or interview
requests, please contact:
Timothy J. Turner – Chief Executive
Officerinfo@bocanaresources.com
Forward-Looking Information
This news release contains "forward-looking
information" within the meaning of applicable securities laws.
Forward-looking information can be identified by words such as:
"intend", "believe", "estimate", "expect", "may", "will",
"approximately", "planning", "projected", "anticipate" and similar
references to future periods. Forward-looking information is
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance
or achievements of Bocana, as the case may be, to be materially
different from those expressed or implied by such forward-looking
information, including but without limitation, statements
pertaining to the Transaction including Bocana's ability to obtain
financing and the necessary approvals, including regulatory
approvals for the Transaction. All statements included herein
involve various risks and uncertainties because they relate to
future events and circumstances beyond Bocana's control.
Although Bocana has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking information,
there may be other factors that cause results not to be as
anticipated, estimated or intended. Readers are cautioned not to
place undue reliance on forward-looking information. The
forward-looking statements contained in this news release are made
as of the date hereof, and the Company undertakes no obligation to
update publicly or revise any forward-looking statements or
information, except as required by law.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this news release.
Images accompanying this announcement are available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/51502e66-3dfa-466b-98ef-0b485f49de59https://www.globenewswire.com/NewsRoom/AttachmentNg/4cbb3410-2471-495b-9f46-956189b95dc2https://www.globenewswire.com/NewsRoom/AttachmentNg/a2f12344-dd0f-4b50-9802-9864f86bc2d8
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