Mr. Stephen Nano reports
MIRASOL SIGNS AGREEMENT WITH HOCHSCHILD MINING FOR OPTION TO JOINT VENTURE ON THE INDRA PRECIOUS METALS PROJECT, CHILE
Mirasol Resources Ltd. has signed a binding letter agreement for the Mirasol's Indra epithermal precious metals project in Chile with Hochschild Mining PLC.As detailed in Mirasol's Aug. 29, 2018, press release, the agreement gives Hochschild the right to acquire, in multiple stages, up to 70 per cent of the project by completing a series of exploration and development milestones and making staged option payments.
Mirasol is also pleased to report that it has initiated work on the Indra project. The initial program will comprise detailed geological mapping and surface rock and trench geochemical sampling, along with a 2,100-line-kilometre ground magnetic and additional electrical geophysical surveys to define drill targets at the project.
Stephen Nano, chief executive officer of Mirasol, stated: "We are pleased to have completed the due diligence review and executed the agreement in such a short timeframe. The exploration program is already under way at the project and we look forward to reporting results as they become available.Indra is an attractive, conceptual epithermal gold-silver target located at low altitude, nearby to existing mine infrastructure in the highly prospective Paleocene age mineral belt of northern Chile."
Hochschild is a leading precious metals producer focusing on high-grade silver and gold deposits, with over 50 years of experience in the Americas. Hochschild has four operating mines and has extensive experience developing and operating underground epithermal vein mines.
Terms of the agreement
Option phase:
A $50,000 (U.S.) cash payment upon signing the agreement; A minimum commitment for Hochschild to spend $800,000 (U.S.) in the initial 18-month exploration program and to drill a minimum of 1,500 metres within 30 months of the date of the agreement; Mirasol will operate the project during the option phase and will receive a 10-per-cent management fee from exploration contracts with values of less than $250,000 (U.S.) and 5 per cent from contracts with values of more than $250,000 (U.S.); At the end of the option period, Hochschild will have the right to exercise the earn-in phase of the agreement.
Earn-in phase:
Stage 1: If Hochschild elects to exercise the option to earn-in, Hochschild will have the right to earn 51 per cent of the project over a three-year period (total 4.5 years) by spending no less than $5.2-million (U.S.) (total $6-million (U.S.)) and making two staged payments totalling $675,000 (U.S.).Stage 2: If Hochschild elects to proceed to stage 2 of the earn-in, Hochschild will have the right to earn 60 per cent of the project over an additional three-year period (total 7.5 years), by financing the delivery of a positive preliminary economic assessment, in accordance with National Instrument 43-101 on a resource of not less than one million ounces of gold at a cut-off grade of 0.50 gram per tonne.Stage 3: If Hochschild elects to proceed to stage 3 of the earn-in, Hochschild will have the right to earn 70 per cent of the project over an additional three-year period (total 10.5 years) by financing the delivery of a feasibility study, in accordance with NI 43-101.Stage 4: After completion of stage 3, Mirasol can elect to contribute its proportionate share (30 per cent) of further development expenditures or exercise a financing option requiring Hochschild to finance Mirasol's share of the development costs through to production in exchange for a further 5-per-cent interest in the project. If Mirasol exercises the financing option, Mirasol's interest will be reduced from 30 per cent to 25 per cent and Hochschild's interest will be increased from 70 per cent to 75 per cent.
The agreement contains other customary terms including extension rights to increase the duration of each stage 1, 2 or 3 for cash payments to Mirasol, pre-emptive rights provisions should either party elect to sell its interest in the project, and a 2-per-cent net smelter return dilution royalty, triggered upon dilution of a party's interest to 10 per cent or below, if the agreement proceeds beyond 51-per-cent earn-in.
The Indra project
Mirasol's 100-per-cent-owned 21,000-hectare Indra epithermal precious metals project is located in the Paleocene Age mineral belt, five kilometres south of the 1.37-million-ounce gold-equivalent El Guanaco gold mine in northern Chile.
The project was staked by Mirasol as an outcome of the company's Atacama-Puna Generative exploration program and encompasses what Mirasol interprets may be the upper levels of a large epithermal gold-silver system. Mirasol has identified a limited number of prospect pits at Indra estimated to be from the 1900s; however, there is no evidence of modern exploration at the project despite year-round access and location adjacent to an operating mine. A news release providing a technical summary of the project will be issued in the near future.
About Mirasol Resources Ltd
Mirasol is a premier project generation company that is focused on the discovery and development of profitable precious metal and copper deposits. Mirasol employs an integrated generative and on-ground exploration approach, combining leading-edge technologies and experienced exploration geoscientists to maximize the potential for discovery. Mirasol is in a strong financial position and has a significant portfolio of exploration projects located within the Tertiary Age mineral belts of Chile and the Jurassic age gold-silver district of Santa Cruz province, Argentina.
Stephen Nano, president and chief executive officer of Mirasol, has approved the technical content of this news release. Mr. Nano is a charter professional geologist and fellow of the Australasian Institute of Mining and Metallurgy (CP and FAusIMM) and is a qualified person under National Instrument 43-101.
Quality assurance/quality control of the Indra exploration program: All exploration on the project was supervised by Mr. Nano, who is the qualified person under NI 43-101.
Mirasol applies industry-standard exploration sampling methodologies and techniques. All geochemical soil, stream, rock and drill samples are collected under the supervision of the company's geologists in accordance with industry practice. Geochemical assays are obtained and reported under a quality assurance and quality control (QA/QC) program. Samples are dispatched to an ISO 9001:2008 accredited laboratory in Chile for analysis. Assay results from surface rock, channel, trench and drill core samples may be higher, lower or similar to results obtained from surface samples due to surficial oxidation and enrichment processes, or due to natural geological-grade variations in the primary mineralization.
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