Patagonia Gold PLC Definitive Agreement - Calcatreu Deposit (3979A)
December 28 2017 - 1:00AM
UK Regulatory
TIDMPGD
RNS Number : 3979A
Patagonia Gold PLC
28 December 2017
28 December 2017
Patagonia Gold Plc
("Patagonia Gold" or the "Company")
Execution of Definitive Agreement for the Calcatreu Deposit
Patagonia Gold Plc (AIM:PGD), the mining company with gold and
silver projects in the southern Patagonia region of Argentina,
Chile and Uruguay, is pleased to announce that, further to its
announcement of 11 December 2017, on 22 December 2017 the Company
signed the Definitive Agreement to acquire the Calcatreu Deposit
from Pan American Silver Corp. ("Pan American"), by way of
acquiring all shares of a wholly-owned subsidiary of Pan American,
for a total consideration of US$15 million.
Patagonia Gold was granted an exclusive option to purchase the
Calcatreu deposit as initially announced on 24 April 2017.
Pursuant to the Definitive Agreement, Patagonia Gold will make
an initial payment of US$5 million upon closing of the acquisition,
which is expected to take place on or before 31 January 2018
subject to certain customary closing conditions. The US$5 million
will be paid from the recently completed fundraising announced on 8
December 2017. The remaining US$10 million is due on 18 May 2018
and will be settled using a combination of funds from the recent
fundraising and the Company's existing cash resources.
Patagonia Gold intends to advance the Calcatreu project during
2018 by exploring the area immediately around the existing resource
with the aim of increasing the resource. The Company is confident
that there remains significant potential to increase the existing
resource base and believes that approximately 12 - 18 months will
be required to generate and drill off known targets. The system has
a known strike length of over 8 km and the Company believes that
this may well increase with an improved knowledge of the system and
more detailed geophysical and geochemical surveys which the Company
intends to undertake on completion of the acquisition. The Company
has the financial resources necessary to progress the project
following the recent fundraising. Further announcements will be
made as appropriate as the drilling programme progresses.
About the Calcatreu Deposit
The Calcatreu Deposit is a high grade (2.325 g/t AuEq) low
sulphidation gold system with the mineralisation outcropping at
surface. An independent mineral resource estimate was completed by
Micon International Limited of Toronto in 2008 for the Calcatreu
Deposit, prepared in accordance with the Canadian National
Instrument 43-101 requirements and set out the current resource,
which contains 8 million tonnes at 3.04 g/t AuEq for 780,000 oz in
the Indicated category and a further 255,000 oz at 2.32 g/t AuEq in
the Inferred category. This resource model was completed in 2008
using a gold price of US$650/oz and a silver price of US$12.50/oz.
The surrounding land package is large with over 25,000 hectares of
sparsely explored terrain.
About Patagonia Gold
Patagonia Gold is a mining and exploration company with the
primary objective of increasing shareholder value through the
acquisition, exploration and development of gold and silver
projects in the Deseado Massif region of Argentina.
The Company holds, directly or indirectly through its
subsidiaries or under option agreements, the mineral rights to over
220 property interests in Argentina, Chile and Uruguay. These
include the mineral rights to 67 property interests in the province
of Santa Cruz covering approximately 190,000 hectares held by the
Company's 90%-owned Argentinian subsidiary, Patagonia Gold S.A. and
to 51 property interests covering approximately 156,000 hectares
held by its wholly owned Argentinian subsidiary Minera Minamalu
S.A.
For more information, please contact:
Christopher van Tienhoven, Chief Executive Officer
Patagonia Gold Plc
Tel: +54 11 5278 6950
Angela Hallett / Richard Tulloch
Strand Hanson Limited
Tel: +44 (0)20 7409 3494
This information is provided by RNS
The company news service from the London Stock Exchange
END
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