GSilver Furthers Consolidation of the Guanajuato Mining District
Guanajuato Silver Company Ltd. (TSX-V:GSVR)(OTCQX:GSVRF) is pleased to announce that it has closed the purchase of Great Panther Mining Ltd.’s (TSX:GPR) Mexican subsidiary Minera Mexicana Rosario S.A. de C.V. which owns the currently operating Topia mine and production facility in the state of Durango, Mexico and the San Ignacio mine, the Valenciana Mine Complex, and the Cata processing plant in Guanajuato, Mexico, first announced in the Company’s news release of June 29, 2022.
Closing the MMR Acquisition
GSilver and Great Panther closed the MMR Acquisition on August 4, 2022 with the execution of customary closing documents in Mexico and Canada and with the payment to Great Panther of US$14,700,000, subject to certain closing adjustments, satisfied with US$8,000,000 in cash and the delivery to Great Panther of 25,787,200 common shares of the Company.
Chairman and CEO James Anderson commented, “We look forward to integrating our new assets with current operations expeditiously. GSilver plans to restart the San Ignacio mine as soon as practicable, and deliver its silver and gold mineralized material to our El Cubo plant for processing. In the months ahead, we plan to do the same at the Valenciana Mine Complex – shipping mineralized material to El Cubo for processing – prior to re-starting the Cata mill in 2023. Meanwhile, at Topia, our other new asset, work will begin immediately to assess optimization opportunities to existing operations in both the mine and the plant.”
MMR Assets Purchased:
Great Panther referred to its five mines near the centre of Guanajuato as the “Guanajuato Mine Complex” or “GMC”. From north to south, these mines are called Guanajuatito, Valenciana, Cata, Los Pozos, and Promontorio. Henceforth, GSilver will refer to these mines collectively as the “Valenciana Mine Complex” and to the accompanying processing plant, which has a nameplate capacity of 1,200 tonnes per day, as “Cata”.
VMC has been in near continuous operation since the 1500s and is situated along the highly productive Veta Madre, encompassing a strike length of 4.2km. Valenciana became one of the premier silver mines in the world and, for a time, accounted for up to one-third of global annual silver production.
Historical in-situ measured and indicated resources at the Valenciana Mine Complex, as reported by Great Panther (effective date: July 31, 2021), totalled 251,666 tonnes grading 250 gpt Ag and 1.76 gpt Au (400 gpt AgEq) for 3.23M AgEq ounces, with additional inferred resources of 220,760 tonnes grading 225 gpt Ag and 1.95 gpt Au (391 gpt AgEq) for 2.77M AgEq ounces. See the mineral resources table for Valenciana below. (1)
The Cata processing plant, which forms part of the Valenciana Mine Complex, has a nameplate capacity of 1,200 tonnes per day (36,000 tonnes/month) and remains in good working condition. The plant is a traditional crushing, grinding and floatation system that produces a high-grade silver-gold concentrate.
Valenciana was put on care and maintenance by Great Panther in November 2021 because of a lack of tailings capacity.
The San Ignacio Mine is located approximately 20km by road west of the city of Guanajuato and 38km from GSilver’s El Cubo mill. Mineralization exists within an epithermal quartz vein system called ‘La Luz’, which is a large regional tectonic structure that also hosts Endeavour Silver’s Bolanitos Mine.
San Ignacio has operated for 10 years, with high grade silver and gold material continually trucked to Great Panther’s Cata mill for processing. GSilver intends to transport material from San Ignacio to El Cubo for processing.
Historical in-situ measured and indicated resources at San Ignacio as reported by Great Panther (effective date: July 31, 2021) totalled 267,828 tonnes grading 145 gpt Ag and 2.80 gpt Au (384 gpt AgEq) for 3.30M AgEq ounces, with inferred resources of 445,217 tonnes grading 178 gpt Ag and 2.65 gpt Au (404 gpt AgEq) for 5.78M AgEq ounces. See the mineral resources table for San Ignacio below. (1)
San Ignacio was put on care and maintenance by Great Panther in January 2022 due to a lack of tailings capacity.
Topia Mine and Mill, Durango, Mexico:
Great Panther has operated the Topia Mine in north-eastern Durango since 2004; the mine includes a 260 tonnes per day flotation processing plant that is currently operating at close to full capacity. The mineral deposits at Topia are different than those seen at Valenciana and San Ignacio, which exclusively produce precious metals. Mineralization at Topia exists as polymetallic epithermal veins that contain high-grade concentrations of silver, zinc, lead and gold. The Topia veins consist mainly of massive galena, sphalerite, and tetrahedrite in a gangue of quartz, barite, and calcite.
Historical in-situ measured and indicated resources at Topia as reported by Great Panther (effective date: March 31, 2021) totalled 331,800 tonnes grading 609 gpt Ag, 1.84 gpt Au, 4.4% Pb and 4.5% Zn (1,041 gpt AgEq) for 11.10M AgEq ounces, with inferred resources of 274,600 tonnes grading 592 gpt Ag, 1.44 gpt Au, 3.35% Pb and 3.63%Zn (932 gpt AgEq) for 8.22M AgEq ounces. See the mineral resources table for Topia below. (1)
Topia is currently in operation; the mine produces a lead-silver-gold concentrate and a separate zinc concentrate.
Valenciana and San Ignacio – Effective Date: July 31, 2021
|Class||Tonnes||Ag (gpt)||Ag (oz)||Au (gpt)||Au (oz)||AgEq (gpt)||AgEq (oz)|
|Measured and Indicated||251,666||250||2,021,193||1.76||14,280||400||3,235,029|
|Measured and Indicated||267,828||145||1,248,734||2.80||24,106||384||3,302,726|
|Measured and Indicated||519,493||196||3,269,927||2.30||38,386||391||6,537,755|
Topia mine – Effective Date: March 31, 2021
|Class||Tonnes||Ag (gpt)||Ag (oz)||Pb (%)||Zn (%)||AgEq (gpt)||AgEq (oz)|
|Measured and Indicated||331,800||609||1.84||4.40||4.50||1,041||11,107,000|
GSilver is not treating these estimates as current mineral resources as a qualified person on behalf of GSilver has not done sufficient work to classify these estimates as current mineral resources. (1)
Closing the MMR Acquisition – Details:
On closing of the MMR Acquisition today, GSilver paid US$14.7M to Great Panther as follows:
GSilver also paid US$1.35M in working capital adjustments (subject to post-closing reconciliations) to Great Panther for excess working capital left in MMR over and above the agreed upon target working capital. Total acquired working capital includes US$500K in cash.
GSilver has also agreed to pay Great Panther up to an additional US$2.0M in contingent payments based on the following:
Hernan Dorado Smith, a director of GSilver and a “qualified person” as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects, has approved the scientific and technical information contained in this news release.
About Guanajuato Silver Company Ltd.:
GSilver mines and processes silver and gold concentrate from its El Cubo, Valenciana, San Ignacio and Pinguico mines in Guanajuato, Mexico and from its Topia mine in Durango, Mexico.
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