VANCOUVER, British Columbia, Aug. 13, 2019 (GLOBE NEWSWIRE) -- Patagonia Gold Corp. (formerly Hunt Mining Corp.) (“Patagonia” or the “Company”) (TSXV: PGDC) is pleased to announce that the Company has accepted Latin Metals Inc.’s (formerly Centenera Mining Corporation) (“Latin Metals”) offer (the “Offer”) to enter into an option agreement (the “Agreement”) regarding the acquisition by Patagonia of the past-producing Mina Angela property (“Mina Angela”) located in the Province of Chubut, Argentina. Mina Angela is located approximately 50 km from the Company’s Calcatreu gold project, which is located in the Rio Negro province, Argentina.
Highlights of the Offer and Proposed Option Agreement:
- Six-month exclusive due diligence period;
- The Agreement is expected to grant Patagonia the option to acquire Mina Angela from Latin Metals for total consideration of US$1 million plus a 1% Net Smelter Royalty (“NSR”) on any future production;
- Mina Angela had limited historical exploration and past production of approximately 130,000 ounces of Au and approximately 1.6 million ounces of Ag from only 2 veins;
- There is potential for discovery of additional precious metal mineralized veins; and
- Mina Angela has similar age and general geologic characteristics of the Company’s 100% owned Calcatreu gold project.
Mina Angela lies within the northwest-oriented, regional-scale Gastre Fault System, a highly prospective belt known to host other gold-silver deposits such as Navidad and Calcatreu. In connection with the Offer, Patagonia has agreed to pay Latin Metals US$40,000 during the due diligence period, which gives Patagonia exclusive rights to enter into the Agreement. At the end of the due diligence period and upon signing of the Agreement, it is expected that Patagonia will pay US$250,000 to Latin Metals and a further US$250,000 within six months of signing the Agreement if Patagonia exercises the option. A further, and final payment of US$500,000 is expected to be due, once rights-to-mine in the province are established. In addition, Latin Metals is expected to be entitled to receive a 1% NSR from future production. Patagonia expects to have the option to acquire half of the NSR for a payment of US$1 million.
The acquisition of the Mina Angela is also subject to customary closing conditions, including the entry into of the Agreement and the approval of the TSX Venture Exchange since it is a “reviewable transaction” for Latin Metals.
About the Mina Angela Property
The Mina Angela property is situated in the Somuncura Massif of southern Argentina and is comprised of 44 individual claims. It covers 200 km² and is located approximately 50 km east-southeast of Patagonia’s 100% owned Calcatreu gold project. The Navidad silver and base metal deposit is located 45 km further to the south-southeast of Mina Angela. There is currently a 1% NSR from future production on the Mina Angela property.
The area is in a region of highly prospective, Jurassic-aged, bimodal volcaniclastic rocks, which host NE-trending, gold- and silver-bearing, intermediate sulfidation epithermal veins. The veins are spatially associated with rhyolite domes and dykes and the system broadens to the southwest.
Production took place at the Mina Angela property on selected veins between 1978 and 1992. From 1983, when accurate mining records begin, until closure in 1992, Mina Angela produced 1,037,360 tons at an average grade of 4.0g/t Au, 48.4g/t Ag, 2.0% Pb, 0.4% Cu and 4.6% Zn.
In 1997 and 1998 Lonrho Mining South Africa (“Lonrho”) carried out exploration including geological mapping, regional soil sampling and ground geophysics. The program also included 3,443 metres of diamond drilling in 16 holes drilled within a 4 by 5 kilometre area. The best values were obtained on the Sahuel vein system, where one hole intersected 1.36 metres grading 40.65 g/t Au, 1773 g/t Ag, 1.79% Pb, 0.23% Cu and 10.06% Zn at a vertical depth of 65 metres below surface. Another hole drilled on the same system intersected a second vein approximately 65 metres to the west with 2.02 metres averaging 6.69 g/t Au, 240g/t Ag, 0.52% Pb, 0.04% Cu and 2.19% Zn. The other holes indicate gold values ranging from trace to 2.25 g/t over varying widths. The system is presently poorly delineated and remains open along strike and at depth. The Company believes that, through further exploration activities, followed by drilling, the property has a strong potential for the discovery of new, precious metal mineralized structures.
The Company’s Qualified Person has not done sufficient work to validate historic drill and production results and the Company does not consider them current or necessarily indicative of future results. The potential quantity and grade of such results is conceptual in nature, there has been insufficient exploration to define a mineral resource and it is uncertain that further exploration will result in such targets being delineated as mineral resources.
Qualified Person’s Statement
The scientific and technical information herein was reviewed and approved by Dr. Walter Soechting, PGeo. Dr. Soechting has experience in the type of deposit under consideration and in the type of activity conducted, and is a Qualified Person as defined by NI 43-101. Dr. Soechting took reasonable steps to verify the scientific and technical information in this news release; however, he did not have access to the historical drill logs or samples.
About Patagonia Gold
Patagonia Gold Corp. is a mining and development company listed on the TSX Venture Exchange. The Company seeks to grow shareholder value through exploration and development of gold and silver projects in the Patagonia region of Argentina. The Company is primarily focused on the Calcatreu project in Rio Negro and the development of the Cap-Oeste underground project. Patagonia, indirectly through its subsidiaries or under option agreements, has mineral rights to over 350 properties in several provinces of Argentina, Chile and Uruguay and is one of the largest landholders in the province of Santa Cruz, Argentina.
For more information, please contact:
Christopher van Tienhoven, Chief Executive Officer
Patagonia Gold Corp
T: +54 11 5278 6950
E: cvantienhoven@patagoniagold.com
FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements, including, but not limited to, statements about the Agreement, approval of the TSX Venture Exchange and the Company’s future plans and intentions. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management’s current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. These forward- looking statements are made as of the date of this news release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
