· Newmont to continue at Anzá gold project
· US$500,000 option payment received
London, September 3rd, 2020 . Orosur Mining Inc. (“Orosur” or the “Company”) (TSX/AIM:OMI), announces that it has been informed by Newmont Colombia S.A.S. (“Newmont Colombia”) a subsidiary of Newmont Corporation (NYSE:NEM), that it intends to continue to exercise its rights and obligations with regard to the Anzá gold project in Colombia (the “Anza Project”) under the terms of the Exploration Agreement with Venture Option (the “Agreement”) signed and announced in September 2018.
Newmont Colombia has now paid the fourth and final cash payment of US$500,000 required under the Phase I earn-in arrangement to retain its option and to continue into the 3rd year of Phase 1 of the Agreement during which year it is required to spend a further US$4 million in qualifying expenditure on the Anza Project.
In addition, should qualifying expenditure incurred on the Anzá Project for the year ending 7th September 2020, fall short of the required US$1m under the Agreement, Newmont Colombia will be required to meet such shortfall by making a payment equal to the shortfall to the Company no later than 6th November 2020. The amount of such payment would be determined once the total of qualifying expenditure for the year ending 7th September 2020 has been accounted for.
In the 3rd and 4th years of Phase 1 of the Agreement, Newmont Colombia will be required to spend a total of US$8 million in qualifying expenditure on the Anzá Project to acquire a 51% ownership interest. No further cash payments are due to the Company in the remaining two years of Phase 1 of the Agreement.
To view the full PDF version of this announcement, including Figures 1-3 referred to below, please click here: http://www.rns-pdf.londonstockexchange.com/rns/8663X_1-2020-9-2.pdf
About the Anzá Project
Anzá is a gold exploration project, comprising three exploration licences, four exploration licence applications, and several small exploitation permits, totalling 207.5km2 in the prolific Mid-Cauca belt of Colombia.
The Anzá Project is currently wholly owned by Orosur via its subsidiary, Minera Anzá S.A.
The project is located 50km west of Medellin and is easily accessible by all-weather roads and boasts excellent infrastructure including water, power, communications and large exploration camp.
Anzá lies some 60km south along strike from the giant Buriticá deposit, recently acquired by Zijin Mining for CAN$1.4 billion.
Figure 1. Anzá Location Map
The Anzá Project was acquired by Orosur in 2014, via the acquisition by Orosur of Canadian company Waymar Resources (Waymar) (TSXV:WYM).
Orosur and Waymar explored the project using a variety of techniques including over 24,000m of drilling. Most drilling focussed on the APTA prospect, with a small drilling program identifying mineralisation 1.5km west at the Charrascala prospect.
Geochemistry and other work identified several other targets (Jesuitas, Guaimarala and La Cejita) which have not been drill tested (Figure 2)
Drilling at APTA has defined multiple zones of high-grade gold mineralisation covering a strike of approximately 1.5km, to a depth extent of over 275m, with mineralisation remaining open in all directions. (Figure 3) (Appendix I)
In September 2018, the Anzá project was optioned to Newmont Colombia.
Figure 2. Surface Geochemistry and Target Zones
Figure 3. APTA Drill Plan and Section
Exploration Agreement with Venture Option
The Agreement is described on SEDAR and in previous announcements made by the Company. The key points, which were announced on 10 September 2018, are as follows:
The Agreement provides for a three-phase earn-in structure allowing Newmont Colombia to earn up to a 75% ownership interest in the Anzá Project by spending a minimum of US$30.0 million in qualifying expenditures over twelve years to 2030, completing an NI 43-101 compliant feasibility study and making total cash payments to Orosur of US$4.0 million over Phases 1 and 2.
In Phase 1, Newmont may earn a 51% ownership interest by spending US$10.0 million in qualifying project expenditures over four years to September 2022 and making total cash payments to Orosur of US$2.0 million during the first two years of the Phase 1 earn-in period. Upon Newmont Colombia’s completion of Phase 1, it may elect, in its sole discretion, to exercise its option to form a joint venture with Minera Anz á S.A.
In Phase 2 commencing October 2022, Newmont may elect to earn an additional 14% ownership interest in the Anzá Project by sole-funding US$20.0 million in qualifying expenditures within four years, completing an NI 43-101 compliant pre-feasibility study and making total cash payments to Orosur of US$2.0 million.
In Phase 3 commencing 2026, Newmont may elect to earn an additional 10% ownership interest in the Anzá Project by completing an NI 43-101 compliant feasibility study within four years.
Upon Newmont completing the Phase 3 earn-in, Orosur may elect for Newmont to solely fund all expenditures until the commencement of commercial production at the Anzá Project. If the Company elects for Newmont to do so:
· Newmont’s ownership interest shall increase by 5% to 80% in the Anzá Project;
· Upon the commencement of commercial production, Orosur shall commence contributing funds for adopted programs and budgets in proportion to its ownership interest or suffer dilution of its ownership interest; and
· Newmont shall receive 90% of Orosur’s distribution of earnings or dividends until such time as the amounts received equal the aggregate amount of expenditures incurred by Newmont on behalf of Orosur plus nominal interest.
Brad George, CEO of Orosur, commented:
“We have long valued Newmont as both partner and major shareholder, and we are delighted with their decision to continue to work with us on the Anzá Project”
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