Metallic Minerals Acquires La Plata Silver-Gold-Copper Property in Southwest Colorado and Initiates Property-Wide Exploration Program
VANCOUVER, British Columbia, Sept. 10, 2019 (GLOBE NEWSWIRE) -- Metallic Minerals Corp. (TSX-V: MMG; US OTC: MMNGF) (“Metallic Minerals”) is pleased to announce that it has entered into an option agreement to acquire a 100% interest in the La Plata silver-gold-copper property (the “Property”) in southwest Colorado from two private vendors. The road accessible property covers 32.7 square kilometers (km2) approximately 26 kilometers northwest of Durango, Colorado within the historic high-grade La Plata mining district (the “District”) located at the southern end of the prolific Colorado Mineral Belt. The La Plata property hosts a large-scale precious-metals-rich porphyry system with associated high-grade silver and gold epithermal deposits.
The La Plata district has a long and rich history of mining with the first silver deposits discovered in the 1700s by Spanish explorers. High-grade silver and gold production has been documented from the 1870s through the early 1940s from vein structures, replacement bodies and breccia zones at over 90 individual mines and prospects. From the 1950s to 1970s, major miners Rio Tinto, Exxon and Freeport-McMoRan explored in the District focusing on the significant potential for bulk-tonnage disseminated and stockwork porphyry-hosted copper mineralization1.
During this period of exploration, 49 holes were drilled on the Property, totaling 12,700 meters. Drill holes and trenches confirmed the presence of a large-scale, multi-phase, precious-metals-rich alkalic copper porphyry system grading up to 1% copper with significant silver and other precious metals. Covering at least 3 km by 1 km the porphyry system is exposed over 1 km of vertical relief and remains open to expansion. This large-scale system centers on a 10 km2 magnetic anomaly and is highlighted by an intense hydrothermal alteration signature. Surrounding the porphyry system is an associated high-grade silver and gold-rich epithermal system measuring at least 8 km by 2 km that hosts 56 identified vein, replacement and breccia structures. Historical production from some of these high-grade structures exceeded 500 grams per tonne (“g/t”) silver and over 30 g/t gold with some of the richest deposits exceeding several hundred ounces per ton gold and over a thousand ounces per ton silver2.
Within the porphyry system several higher-grade areas have been identified with the largest at the Allard target area, measuring approximately 1 km long by 200 m wide, and a second at the Copper Age target that is 500 m by 200 m. Both targets remain open to expansion at depth and along strike. One of the deepest holes drilled on the Property intersected 378 m of porphyry style mineralization grading 0.62% copper equivalent (0.52% Cu, 6.2 g/t Ag, and 0.06 g/t Au) including 110 m grading 0.82% copper equivalent (0.64% Cu, 7.4 g/t Ag and 0.13 g/t Au) with the hole ending in mineralization. Only a limited number of holes were analyzed at the time for silver, gold and platinum group metals. However, samples from within the porphyry system indicate potential for significant additional value from silver and other precious metals with select samples returning multi-gram values of gold, platinum and palladium2,3.
Greg Johnson, President and CEO of Metallic Minerals, stated, “We are very excited to add the La Plata property in southwestern Colorado to our portfolio of high-quality silver and gold properties that include our flagship Keno silver, McKay Hill silver and Klondike gold properties in the Yukon. Geologically the La Plata system has many similarities to the precious-metals-rich Galore Creek porphyry system owned by Newmont and Teck in British Columbia’s “Golden Triangle”. We believe the Metallic Minerals team is uniquely suited to take on this compelling exploration opportunity at La Plata based on the experience of its key members who are credited with the major resource expansion of the Galore Creek deposits following their acquisition from Rio Tinto in the early 2000s. Our team also brings additional specific expertise in high-grade, structurally controlled silver and gold deposits both in the region and from exploration in the high-grade Keno Hill silver district.”
Mr. Johnson continued, “The La Plata property has been privately held with almost no modern exploration in over 50 years on either the large-scale porphyry system or the surrounding high-grade epithermal zones, both of which will be a focus for Metallic Minerals. We are initiating on-site exploration to collect geologic, geochemical and geophysical information covering this historic brownfields district, including synthesis of past exploration and mining information to systematically refine future targets for drilling. We believe that systematic exploration at the La Plata property has the potential to not only rapidly enhance the size of the known historic mineral resources but to identify and expand the higher-grade zones within the broader porphyry and epithermal mineralized systems.”
Under the terms of the agreement, Metallic Minerals has an option to acquire a 100% interest in the Property by paying to each vendor 5 million units and US$250,000 upon the achievement of certain milestones over a 4-year period. The Property will be subject to a 1% net smelter returns royalty in favor of each vendor, which may be reduced to 0.75% for each Vendor upon payment of a total of US$500,000.
Each of the foregoing units will comprise one common share and one-half of a share purchase warrant. Each full warrant will be exercisable for the purchase of one common share for a period of 36 months from issuance at an exercise price equal to 120% of the 20-day volume weighted average trading price of the common shares on the TSX Venture Exchange (the "TSXV") on the business day immediately preceding the date of issuance. At Metallic Minerals’ election, the expiry time of the warrants may be accelerated to 30 business days if the closing price for the common shares on the TSXV is greater than 150% of the applicable warrant exercise price for 10 consecutive trading days.
Closing of the acquisition is subject to customary closing conditions, including final acceptance by the TSXV.
Notes: 1) Eckel, USGS Prof Paper 219, Geology and Ore Deposits of the La Plata Mining District, 1949; 2) Bear Creek Mining (now Rio Tinto), Humble Oil (now Exxon) and Phelps Dodge (now Freeport-McMoRan) company reports; 3) Christoffersen, Geological report on the Allard deposit, La Plata Mining District, Durango, Colorado, 2005.
About Metallic Minerals Corp.
Metallic Minerals Corp. is a growth stage exploration company, focused on the acquisition and development of high-grade silver and gold in under-explored districts of mining-friendly jurisdictions proven to produce top-tier assets. Our objective is to create value through a systematic, entrepreneurial approach to exploration in the Keno Hill silver district, La Plata silver-gold-copper district, and Klondike gold district. The Keno silver project is located in the historic Keno Hill silver district of Canada's Yukon Territory, with over 300 million ounces of high-grade silver in past production and current M&I resources, the La Plata silver-gold-copper project in southwestern Colorado hosts a large-scale precious-metals-rich porphyry system and associated high-grade silver-gold epithermal deposits, and the Company is also building a gold production royalty business in the Klondike gold district. All three districts have existing infrastructure, including grid power, highway and road access. Metallic Minerals is led by a team with a track record of discovery and exploration success as well as, having large scale development, permitting and project financing expertise.
About the Metallic Group of Companies
The Metallic Group is a collaboration of leading precious and base metals exploration companies, with a portfolio of large, brownfields assets in established mining districts adjacent to some of the industry’s highest-grade producers of silver and gold, platinum and palladium, and copper. Member companies include Metallic Minerals in the Yukon’s high-grade Keno Hill silver district and La Plata silver-gold-copper district of Colorado, Group Ten Metals in the Stillwater PGM-nickel-copper district of Montana, and Granite Creek Copper in the Yukon’s Minto copper district. The founders and team members of the Metallic Group include highly successful explorationists formerly with some of the industry’s leading explorer/developers and major producers. With this expertise the companies are undertaking a systematic approach to exploration using new models and technologies to facilitate discoveries in these proven, but under-explored, historic mining districts. The Metallic Group is headquartered in Vancouver, BC, Canada and its member companies are listed on the Toronto Venture, US OTC, and Frankfurt stock exchanges.
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Qualified Person
Scott Petsel, P.Geo, Vice President, Exploration and an employee of Metallic Minerals Corp., is a Qualified Person as defined by National Instrument 43-101. Mr. Petsel has reviewed the scientific and technical information in this news release and approves the disclosure contained herein.
Forward-Looking Statements
This news release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, including, without limitation, statements regarding potential mineralization, historic production, estimation of mineral resources, the realization of mineral resource estimates, interpretation of prior exploration and potential exploration results, the timing and success of exploration activities generally, the timing and results of future resource estimates, permitting time lines, metal prices and currency exchange rates, availability of capital, government regulation of exploration operations, environmental risks, reclamation, title, and future plans and objectives of the company are forward-looking statements that involve various risks and uncertainties. Although Metallic Minerals believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual results or developments may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in forward-looking statements include failure to obtain necessary approvals, unsuccessful exploration results, changes in project parameters as plans continue to be refined, results of future resource estimates, future metal prices, availability of capital and financing on acceptable terms, general economic, market or business conditions, risks associated with regulatory changes, defects in title, availability of personnel, materials and equipment on a timely basis, accidents or equipment breakdowns, uninsured risks, delays in receiving government approvals, unanticipated environmental impacts on operations and costs to remedy same, and other exploration or other risks detailed herein and from time to time in public filings made by Metallic Minerals in accordance with applicable securities law. For more information on Metallic Minerals and the risks and challenges of its business, investors should review its annual filings, which are available at . These forward-looking statements speak only as of the date on which they are made, and Metallic Minerals undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances unless otherwise required to do so 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.
