Vena to Acquire Past Producing High-Grade Bongará Zinc-Oxide Mine and High-Grade Charlotte Bongará Zinc Exploration Project, Peru

TORONTO, July 19, 2016 /CNW/ - Vena Resources Inc. (the "Company" or "Vena") (NEX: VEM.H) is pleased to announce the signing of binding Letters of Intent (LOI) with two privately held Peruvian companies to acquire and to jointly consolidate 100% ownership of two zinc projects - the Bongará Zinc Mine and the Charlotte Bongará Zinc Project.  These two high grade zinc-oxide assets are located in the Amazonas Department of north-central Peru. Consolidation of both properties provides a unique opportunity for Vena to re-activate an open-pit zinc-oxide mine in the near-term as well as re-initiate exploration across a total of 11,115 hectares where past drilling has encountered high grade zinc-oxide mineralization.

Martin Walter, President and CEO of Vena commented, "The acquisition of Bongará fits nicely with Vena's current portfolio of high-grade silver and zinc projects and also provides Vena with immediate exposure to a past producing mine."   He also noted, "This is the first time both these projects, the mine and the additional exploration areas, have been consolidated within one company."  In closing, he stated, "Near-term work programs at the Bongará Zinc Mine will focus on widespread shallow exploration drilling and trenching programs followed by metallurgical extraction processes applicable to the Bongará high grade zinc-oxide ores."

The terms of the Binding Letters of Agreement for the acquisitions provide for cash and share payments totaling US$835,000 (US$65,000 has been paid) and US$595,000 (US$10,000 has been paid) over a three-year period for the Bongará Zinc Mine and the adjoining Charlotte Bongará high grade, zinc-oxide exploration project, respectively.  Both properties are subjected to modest advance royalty payments once the acquisitions are complete, and a 2% net smelter return royalty on production. 

Property and Exploration History

The Bongará Zinc Mine zinc-oxide mineralization was discovered in 1974 and since then various companies have completed exploration programs across the area.  The mineralization is concentrated along and proximal to a NW-trending anticlinal axis over approximately 2.5 kilometres.  From the southeast edge of the project, the Mina Grande, Mina Chica, and Bongarita mine areas were subject to sampling from pits and trenches as well as shallow drilling stretching over a distance of approximately 1.2 kilometres. This zinc-oxide mineralization appears to continue to the northwest into an additional exploration area known as Campo Cielo, where pits and trenches have also exposed additional high grade, zinc-oxide mineralization in historical pits and trenches in certain areas as shown on the attached map.

In 2006, Cementos Pacasmayo S.A.A. (NYSE: CPAC) ("CP") contracted Minconsult SRL of Lima, Peru, which estimated resources, regarded as historical, at Bongará based on 69 diamond drill holes for 1,975 metres and 476 pits in the Bongará area (see table below), applying inverse-distance to the fifth power to 10 metre x 10 metre x 4 metre blocks in Mine Site; a specific gravity of 1.6 gram/cc was used.  The Qualified Person has not completed sufficient work to verify this historical estimate as a current resource estimate and is not treating the historical estimate as a current resource estimate.  Additional surface samples, trench samples, and drill hole samples will be required to comply with National Instrument ("NI") 43-101 guidelines in order to provide a current resource estimate.

Minconsult SRL also prepared a mine plan in Mine Site based on an estimated reserve, regarded as historical, of 741,028t at 25.6% Zn (189,696t Zn) using a cutoff grade of 12% Zn, which was based on a US$1,150/t Zn price; other input parameters included a mining cost of approximately US$8.74/t ore, mine site administration cost of US$1.80/t ore, 4-metre bench heights with an overall slope of 36^o, 90% Zn recovery utilizing a Waelz kiln, and estimated treatment and refining costs.   

The Qualified Person has not completed sufficient work to verify this historical estimate as a current reserve estimate and is not treating the historical estimate as a current reserve estimate.  Additional surface samples, trench samples, and drill hole samples, as well as current cost information, will be required to comply with NI 43-101 guidelines in order to provide a current reserve estimate,, which would be included in a future prefeasibility or feasibility study that would support a current reserve estimate.

CP commenced mining operations in March 2007 and over 17 months sent 106,701t at 24.1% Zn for processing in a Waelz kiln, and at the end of 2008, had a stockpile of 31,713t at 20.0% Zn (CP Annual Reports 2007 and 2008). CP is currently remediating the areas affected by previous mining efforts.

The adjacent Charlotte Bongará Zinc project was explored in 1994 by Solitario Resources (TSX: SLR) and ComInco Ltd. later completed five drill holes for 592 metres within the property, two of which encountered near-surface, high grade zinc-oxide mineralization. Between 2007 and 2011, Rio Cristal Zinc (TSXV: RCZ) optioned the project and eventually drilled 95 drill holes for a total of 7,722 metres on the Cristal and Charlita prospects.  In a press release dated October 15, 2008, Rio Cristal Zinc announced impressive near-surface drill intercepts of zinc oxides that included 29.5% Zn across 15.5 metres, 26.1% Zn across 12.5 metres, 29.7% Zn across 11.5 metres (the cited intervals are drill-intercept widths and t true widths are unknown).

Neither the Company nor the Qualified Person verified the data herein with samples. 

The technical data included in this press release have been reviewed by Bill Williams, PhD, CPG, who is a Qualified Person as defined by NI 43-101 and is currently independent of the Company.

SOURCE Vena Resources Inc.