Americas Bullion Acquires 100% of Springer Mining Company and Nevada Assets
Americas Bullion Royalty Corp. (TSX:AMB) (the “Company” or “AMB”) is pleased to announce it has entered into a binding letter of intent with EMC Metals Corp. (TSX:EMC) to acquire a 100% interest in its wholly owned subsidiary, the Springer Mining Company, including all related mine, mill and tungsten resource assets (“Springer”), along with all other Nevada properties held by EMC, for US$5 million. The acquisition of Springer Mining Company is the first transaction in AMB’s plan to focus on acquiring undervalued or distressed natural resource assets in order to provide superior investment returns.Springer is immediately adjacent to the Company’s Humboldt mill site which includes several permits related to the potential development of a 200 tpd gravity floatation gold circuit.
“We are excited to acquire this excellent package of assets at what we consider to be the bottom of the mining cycle. The breadth and quality of the assets including the flexibility of the processing plant offer AMB an unparalleled opportunity to realize the true value of the assets as markets improve and opportunities develop for the divestiture or joint venture of these assets,” said William M. Sheriff, Chairman & CEO. “The distressed asset market presents a compelling opportunity for companies with liquidity and access to capital. We will continue our pursuit of these types of acquisitions with clearly defined exit strategies to realize value and return for our shareholders.”
SPRINGER MINING COMPANY, NEVADA
Springer is located in Pershing County between Winnemucca and Lovelock, Nevada and is accessible by paved road. The mine and mill were originally constructed by General Electric in the late 1970’s. The mill facility has been maintained on care and maintenance continually with major renovation conducted between 2007 and 2012.
In 2012, EMC Metals Corp. demonstrated that the Springer project was and is a viable tungsten business to restart, with the issuance of a new and larger NI 43-101 tungsten resource, along with a Preliminary Economic Assessment (“PEA”).
Asset Highlights
- Underground mine and surface mill facility
- NI 43-101 Resource established and PEA completed
- Mine/mill sized for 1,200 tpd - production capacity of 146,000 MTU WO3 p.a
- Located in a historic tungsten-producing district, with excellent infrastructure in place
- Environmental and operating permits largely in place to re-start facility
- Strong tungsten price, permitting status, and refurbished mill supports a 12 month, time-to- cash restart
Springer is a former tungsten production facility consisting of a 1,360-ft vertical shaft and underground workings, a 1,200 ton per day mill with automated rod/ball mill grinding and flotation circuits, plus all water rights, and virtually all permits necessary for operation of the facility. The original construction cost for the asset in 1981 was $71 million, and EMC has invested approximately $20 million in mill and site refurbishment and upgrading/automation in the last 4 years. The NI 43-101 five-year resource estimate represents start-up production volumes and a considerably larger historic resource estimate was in place at the time of construction and ownership by GE/Utah International Inc.
On September 20, 2012, EMC announced the results of a positive, National Instrument (NI) 43-101 compliant Preliminary Economic Assessment ("PEA"). The PEA was prepared for EMC by Associated Geosciences LTD. of Calgary, Alberta, Canada, and Practical Mining LLC. of Elko, Nevada, USA, both independent mining industry consultants.
Highlights from the PEA/Resource Update*:
- Project restart is economic, feasible, and supported by existing tungsten prices, based on a five year NI 43-101 production resource
- Five-year mine life NPV of $22.8 million (8% discount, constant dollar, after tax)
- IRR of 47% on restart capital of $30 million
- Indicated resource increase of 81,000 tons (+29.6 %) over previous resource estimate
- Inferred resource increase of 837,600 tons (+76.3 %) over previous resource estimate
- New resource added on western side of the property, no previous resource estimate; and
- Average annual tungsten (WO3) production of 134,960 MTU (total 674,790 MTU)
* Based on the technical report entitled “Preliminary Economic Assessment of the Springer Tungsten Mine, Pershing County, Nevada, USA” prepared for EMC Metals Corp. by Associated Geosciences Ltd. of Alberta, Canada. Resource estimates have an effective date of August 20, 2012. To the best of the Company’s knowledge, information, and belief, there is no new material scientific or technical information that would make the disclosure of the mineral resources and results of the preliminary economic assessment inaccurate or misleading. The preliminary economic assessment is preliminary in nature, that it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized. Michael Maslowski, a qualified person under NI 43-101, reviewed the report on behalf of AMB.
CARLIN VANADIUM, NEVADA
AMB also agreed to acquire the Carlin Vanadium property under the terms of the LOI with EMC. One of the largest known primary vanadium resources in the United States, the Carlin Vanadium property consists of 72 unpatented mineral claims covering 1,149 acres (~578 hectares). The property is located along the Carlin gold trend 10 km southwest of Newmont's Carlin Operations, approximately 10 km west of Newmont's Rain Deposit (gold), and 15 miles from the community of Carlin, Nevada. Mineralization is hosted within a 50 ft thick horizon of black shales within the Devonian Woodruff Formation, which consists of dark grey to black siliceous mudstones, and chert with lesser amounts of shale, siltstone, dolomitic siltstone, and calcareous sandstone. The Woodruff formation is unconformably overlain by shallow dipping Permian-Pennsylvanian siltstones, shales, conglomerates, and carbonates of the Chainman and Diamond Peak Formations. Anomalous gold has been encountered in limited surface exploration of the upper plate.
EMC Metals received a technical report prepared pursuant to NI 43-101 from SRK Consulting (US), Inc. entitled “NI 43-101 Technical Report on Resources - EMC Metals Corp. - Carlin Vanadium Project -Carlin, Nevada” with an effective date of April 9, 2010. The technical report disclosed a resource estimate including an inferred resource of 25.4 million tonnes, grading 0.51% V2O5, containing 289 million pounds of V2O5, at 0.3% cut-off grade. To the best of the Company’s knowledge, information, and belief, there is no new material scientific or technical information that would make the disclosure of the mineral resources and results of the preliminary economic assessment inaccurate or misleading.
COPPER KING PROJECT, NEVADA
AMB also agreed to acquire the Copper King Property, Nevada, located in Pershing County, Nevada, under the terms of the LOI with EMC. The Copper King Property is comprised of 8 Lode mineral claims. A historic resource is reported of 500,000 tons of 0.45% WO3 (Nevada Bureau of Mines, Bulletin 105, 1988). A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves; and the Company is not treating the historical estimate as current mineral resources or mineral reserves.
OTHER PROVISIONS
The Agreement provides for the transaction to close within 90 days.
In connection with the transaction, AMB received a loan from an insider in the amount of US$2.5 million. The loan is unsecured and repayable in 120 days.
The technical content of this news release has been reviewed and approved by Michael Maslowski BSc, CPG, the Company's Chief Operating Officer and a Qualified Person as defined by National Instrument 43?101.
Americas Bullion Royalty Corp.
Americas Bullion Royalty Corp. invests in undervalued natural resource assets seeking to provide superior investment returns. In addition to the newly acquired assets, Americas Bullion’s assets also include royalty holdings across Mexico, Nevada, Wyoming, Oregon, and California; the Taylor mill and Humboldt mill site; the Brewery Creek project, and a portfolio of Yukon exploration properties. The Company continues to advance and monetize its holdings to optimize and realize asset values for its shareholders.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance. There are numerous risks and uncertainties that could cause actual results and
Americas Bullion’s plans and objectives to differ materially from those expressed in the forward-looking information. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, Americas Bullion assumes no obligation to update forward-looking information should circumstances or management's estimates or opinions change.
Contact
Americas Bullion Royalty Corp.
William M. Sheriff, Chairman & CEO
208-635-5415
info@aubullion.com
www.aubullion.com