VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 20, 2014) - TriMetals Mining Inc. (formerly South American Silver Corp.) (TSX:TMI)(TSX:TMI.B)(OTCQX:TMIAF) reports the release of its audited consolidated financial statements for the year ended December 31, 2013 and the related management's discussion and analysis of financial position and results of operations ("MD&A"). In this press release, all amounts are expressed in U.S. dollars, unless otherwise indicated.
The estimated working capital requirements for 2014, per the Company's existing plan, amount to $5,200,000 of which $2,550,000 are for general and administrative expenses (operating activities) and $2,650,000 for investing activities which mainly include exploration work in Gold Springs, Escalones and San Antonio projects. As at December 31, 2013, the Company had working capital of $10,415,697, including cash and cash equivalents of $11,921,723. As a consequence, the Company remains in a strong financial position to meet its working capital requirements for 2014 and to continue activities at its Escalones and Gold Springs projects and to pursue other corporate initiatives.
The Company's priorities for 2014 are to (i) diligently continue managing and preserving the Company's cash resources; (ii) continue international arbitration proceedings against Bolivia to recover full compensation based on the fair market value for the Malku Khota project; (iii) seek an appropriate joint venture partner for the Escalones copper-gold porphyry project in Chile whilst continuing permitting activities and metallurgical testing and analyzing existing data and core samples; and (iv) review the economic potential of the Gold Springs gold project to help determine if it should proceed along the engineering/development curve or continue the exploration phase to further expand the estimated resource, whilst continuing permitting activities and metallurgical testing and completing a NI 43-101 compliant Preliminary Economic Assessment (PEA).
Further details including the full financial statements and MD&A and information on each of the Company's projects, including the recently acquired Gold Springs Gold Project in Nevada/Utah, are available on the Company's website at www.trimetalsmining.com and on SEDAR at www.sedar.com.
Acquisition of High Desert Gold Corporation - Gold Springs, Nevada
On December 20, 2013 the Company acquired all of the issued and outstanding shares of High Desert Gold Corporation ("HDG") that it did not already own in an all-share transaction by way of a plan of arrangement (the "Arrangement") (See News Release NR 13-25 dated December 20, 2013).
The Company now holds a 100% interest in the 74 square kilometre Gold Springs gold project located in western Utah and eastern Nevada. HDG completed 56 drill holes at Gold Springs in 2012 and an additional 55 holes in the 2013 drill program. On February 26, 2014, the Company announced the completion of an updated resource estimate for the Jumbo and Grey Eagle Zones (NR 14-02, February 26, 2014) and On March 19, 2014, the Company filed a NI 43-101 Technical Report(1) that includes the updated 2014 resource (NR 14-05, March 19, 2014). The updated 2014 resource includes measured, indicated and inferred resource categories in comparison to the prior resource of 2013 which only included resources in the inferred category.
The gold-silver mineralization, at both the Jumbo and Grey Eagle Zones, remains open to expansion laterally and to depth as the drilling to date has typically only penetrated the top 150 metres vertically below the surface at Jumbo, and 200 metres below the surface at Grey Eagle. The ZTEM geophysical survey, completed in 2011, indicates that the gold-silver bearing geological/geophysical setting that has been drilled at the Jumbo may continue for approximately 8 kilometres along strike, much of which remains untested.
The exploration budgeted at Gold Springs for 2014 is $1,400,000 which includes, among other things, preparation of a preliminary economic assessment (PEA) to help the Company determine if it should proceed along the engineering/development curve or continue the exploration phase to further expand the resource, continuation of permitting activities including environmental and cultural studies, completion of a NI 43-101-compliant Technical Report that includes the updated 2014 resource, metallurgical test-work and other limited exploration activities.
Escalones, Chile
The Company believes that it needs a partner to develop this project due to its large size. Companies have been approached to gauge their level of interest in joint venturing the property. Reviews are ongoing.
The budgeted exploration at Escalones for 2014 amounts to $1,000,000 which includes further analysis of existing data and core samples, the continuation of environmental and permitting activities and metallurgical testing, and a $500,000 payment under its Option Agreement.
On May 2, 2013 the Company completed its drilling program at Escalones copper-gold project in Chile, with a total of 9,070 metres of drilling completed. On August 12, 2013, the Company filed a NI 43-101 Technical Report(2) that includes an updated resource estimate for Escalones (See News Releases 13-13 dated June 28, 2013 and 13-17 dated August 12, 2013) showing a significant increase in copper, molybdenum and gold resources as well as a category upgrade of approximately a third of the resource to Indicated from Inferred.
Malku Khota, Bolivia
Immediately prior to the acquisition of HDG, each shareholder of the Company received one TMI new Common Share and one TMI Class B Share for each common share previously held. The Class B Shares entitle the holders collectively to 85% of the net cash, if any, (after deducting all costs, tax and expenses and the third party funder's portion thereof) received from an award or settlement in relation to South American Silver Limited's arbitration proceeding against Bolivia following the expropriation of the Malku Khota project.
The Company continues to advance before the Permanent Court of Arbitration its international arbitration proceedings against Bolivia for the expropriation of the Malku Khota project. The three-person arbitration tribunal was formed on January 22, 2014 (See News Release 14-01 dated February 3, 2014). The tribunal next step is to set up a provisional timetable for the arbitration itself. This will include a schedule for submission of a Statement of Claim which South American Silver Limited expects to submit in 2014, a Statement of Defense and oral hearings at the court of arbitration. Unless there is a negotiated settlement of the dispute, it is expected that the arbitration can take up to several years from commencement of proceedings until rendering of a final award, hence any actual cash award, if there is one, would not be expected for some time and not in 2014.
On May 23, 2013 the Company entered into an agreement (the "Arbitration Costs Funding Agreement") with a third party funder (the "Fund") pursuant to which the Fund will cover most of South American Silver Limited future costs and expenses related to its international arbitration proceedings against Bolivia on a non-recourse basis. The Company has given certain warranties and covenants to the Fund and has provided security for its obligations. In consideration for the funding, South American Silver Limited and the Company have agreed to pay to the Fund a portion of any recoveries received by South American Silver Limited from Bolivia. (See News Release NR 13-12 dated May 24, 2013 for more details).
About TriMetals Mining Inc.
TriMetals Mining Inc. is a growth focused mineral exploration company creating value through the exploration and development of the near surface, Gold Springs gold-silver project in mining friendly Nevada and Utah in the U.S.A.; the advancement of the large scale Escalones copper-gold project in Chile, and realization of value from the expropriated Malku Khota project in Bolivia through the arbitration process. South American Silver Limited is a company incorporated in the Bermuda Islands, an overseas territory of the United Kingdom, which through its wholly owned Bahaman subsidiaries: Malku Khota Ltd, G.M. Campana Ltd. and Productora Limited., owns 100% of the outstanding shares of Compañía Minera Malku Khota S.A., a Bolivian company, holder of the Malku-Khota mining concessions until their nationalization by the Bolivian Government. The Company's approach to business combines the team's track record of discovery and advancement of large projects, key operational and process expertise, and a focus on community relations and sustainable development. Management has extensive experience in the global exploration and mining industry. The Company's common shares and Class B shares are listed on the Toronto Stock Exchange under the symbols "TMI" and "TMI.B" and the common shares are listed on the OTCQX market under the symbols "TMIAF". Additional information related to TriMetals Mining Inc. is available at www.trimetalsmining.com and on SEDAR at www.sedar.com.
Forward-looking statements
Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "will", "next", "plan", "may", "budgeted", "proceed", ""continue", "further", "potential", "expected", "believes", "creating", "realization" and "pursue" and similar expressions. This News Release contains forward-looking statements. These forward-looking statements are based on current expectations and various estimates, factors and assumptions and involve known and unknown risks, uncertainties and other factors.
Readers are cautioned not to place undue reliance on these statements as the Company's actual results, performance or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore, the Company cannot provide any assurance that forward-looking statements will materialize. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking statements, include, but are not limited to, uncertainties associated with the arbitration proceeding against Bolivia, including the quantum of damages to be obtained and the realization or collection of the value of any award or settlement; and risks of the mineral exploration industry which may affect the advancement of the Escalones or Gold Springs projects, including possible variations in mineral resources or grade, metal prices, availability of sufficient financing to fund further required work in a timely manner and on acceptable terms, timely receipt of required permits, availability of equipment and qualified personnel, failure of equipment or processes to operate as anticipated, road access to the property, changes in project parameters as plans continue to be refined; and other risks more fully described in the Company's Annual Information Form filed and publicly available on SEDAR at www.sedar.com. The assumptions made in developing the forward-looking statements include: the ability of the Company to realize value from its investments in Bolivia; the arbitration proceeding along a timeline consistent with other international arbitrations and the Fund honoring its contractual commitments, the accuracy of current resource estimates and the interpretation of drill, metallurgical testing and other exploration results; the timely receipt of required permits for Escalones and Gold Springs projects; the continuing support for mining by local governments in Nevada, Utah and Chile, the availability of equipment and qualified personnel to advance the Escalones and Gold Springs projects; and the execution of the Company's existing plans and further exploration and development programs for Escalones and Gold Springs Projects, which may change due to changes in the views of the Company or if new information arises which makes it prudent to change such plans or programs.
Subject to applicable laws, the Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason. Unless otherwise indicated, forward-looking statements in this News Release describe the Company's expectations as of March 20, 2014.
(1) Prepared by Ms. Terre Lane, President of Lane and Associates and Kurt Katsura, M.S., R.G, each a "qualified person" as defined in NI 43-101, and "independent" of the Company as defined in NI 43-10.
(2) Prepared by Jeffrey Choquette of Hard Rock Consulting, LLC and David Dreisinger of Dreisinger Consulting Inc.; each a "qualified person" as defined in NI 43-101 and "independent" of the Company as defined in NI 43-101,