NewsVangold Resources to acquire El Pinguico property 2016-12-23 13:54 ET - News Release
Mr. Dal Brynelsen reports
VANGOLD SIGNS AGREEMENT FOR 100% INTEREST IN HISTORIC EL PINGUICO MINE
Vangold Resources Ltd. has entered into an asset acquisition agreement made effective Dec. 16, 2016, with Exploraciones Mineras Del Bajio SA de CV (EMDB) to acquire a 100-per-cent interest in the El Pinguico property. The property consists of two mining concessions covering 71 hectares, located approximately five kilometres southeast of the city of Guanajuato in Guanajuato state, Mexico, and contains the historic El Pinguico-Carmen silver-gold mine. The acquisition is at arm's length.
The historic El Pinguico mine is on strike with the motherlode and is located approximately 4.5 kilometres from Endeavor Silver's El Cubo mine and 2.5 kilometres from Mina Las Torres, Fresnillo. The property has excellent access routes, communications, basic mining infrastructure and proximity to processing plants. In 2012, the Mexican Geological Service (SGM) estimated the presence of 320,000 metric tonnes of broken mineralized rock underground with an average grade of 1.66 grams per tonne gold and 167 grams per tonne silver. EMDB has been conducting a geological assessment of the historic mine with the aim of bringing it back into production and liberating the stockpile.
Under the terms of the agreement, Vangold will pay $20,000 (U.S.) on execution, $30,000 (U.S.) on receipt of TSX Venture Exchange approval, issue five million common shares on closing, and make a final payment of $50,000 (U.S.) on the date that is six months after TSX-V approval. Vangold has further granted EMDB royalties equal to: (i) 4-per-cent net smelter return royalty and 15-per-cent net profit interest on minerals recovered from the stockpile; and (ii) 3-per-cent net smelter return royalty (of which Vangold can repurchase one-third (1-per-cent net smelter return royalty interest) for $1-million (U.S.)) and 5-per-cent net profit interest on all newly mined mineralization. In connection with the acquisition, Vangold has agreed to pay a finder's fee equal to 10 per cent of the acquisition value up to $300,000 and 7.5 per cent of the acquisition value in excess of $300,000. The agreement and payment of the finder's fee remain subject to a number of conditions, including the approval of the TSX-V. All securities issued will be subject to a four-month hold period.
Guanajuato state; El Pinguico mine
The Guanajuato mining district is considered to be one of the top three historic silver mining districts in Mexico, having produced an estimated one billion to 1.2 billion ounces silver and five million to six million ounces gold (General Direction of Mining Development). At their peak during the 1700s, the silver mines of Guanajuato were thought to be the largest and richest silver mines in the world.
The historic El Pinguico mine was one of the richest gold and silver mines at the beginning of the 20th century. It was operated by The Pinguico Mines Company with grades over 50 grams per tonne gold and 700 grams per tonne silver. First put into production in 1890, the historic El Pinguico mine was in full production by 1906 (approximately 250 tonnes per day), one of the largest in its day. The mineralization is a classic, low-sulphidation epithermal vein system, consisting of disseminations and fracture fillings of pyrite, pyrargygrite, polybasite and electrum in quartz-calcite veins ranging from one metre to 30 metres thick but averaging two metres to three metres wide. Multiple historic mineralized zones (now stopes) formed steep-plunging shoots 100 metres to 500 metres long that were mined down to depths of 200 metres to 600 metres (Prof. Robert T. Hill, 1910, report upon the properties of The Pinguico Mines Company, The Securities Corporation Ltd., New York, N.Y.).
A qualified person has not verified the sampling done by the SGM in 2012 as the original samples were unavailable and new samples will need to be obtained. Although this work was not performed under National Instrument 43-101 and not tested in a certified laboratory, there is considerable exploration potential at the historic El Pinguico mine. Further work is required in these areas, including sampling and mapping.
Vangold intends to commission an NI 43-101 report to establish a work program and budget for the property, which is expected to include data compilation, mapping and sampling. The results of this work will be used to outline priority targets to be tested by second phase, with further mapping and sampling continuing during phase 2.
Dal Brynelsen, chief executive officer of Vangold, stated: "We are extremely pleased with the opportunity represented by the historic El Pinguico mine. The location and historical reports show significant promise. We are looking forward to a more detailed and systematic exploration of the property and its potential."
The company also reports that Anna Serin has resigned from the office of corporate secretary. The company would like to thank Ms. Serin for her years of devoted service and wishes her well in her future endeavours.
The disclosure of scientific or technical information regarding the property in this news release has been reviewed and approved by Carlos Cham, PEng, CPG, who is considered an independent qualified person under National Instrument 43-101. Mr. Cham received a bachelor of geological engineering from the Universidad Autonoma de San Luis Potosi in 2003 and has also completed an MBA (specializing in finance) from the Universidad Tec Milenio and a diploma in mining and environment from the University Miguel de Cervantes. Mr. Cham has 13 years experience working as a geologist or geologist engineer, including exploration on several precious and base metal projects in Mexico, and is a certified professional geologist (exploration) of the American Institute of Professional Geologists, as well as a member of the Asociacion de Ingenieros de Minas, Metalurgistas y Geologos de Mexico.
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