Vancouver, BC – November 12, 2019 – Aftermath Silver Ltd. (TSX:V AAG) (“Aftermath” or the “Company”) is pleased to announce it has received acceptance from the TSX Venture Exchange (the “TSX-V“) for the Challacollo Share Purchase Agreement with Mandalay Resources Corporation.
Challacollo Silver-Gold Project
Further to the Letter of Intent dated June 22, 2018, as amended, Aftermath has now entered into a comprehensive Share Purchase Agreement with Mandalay Resources Corporation to purchase a 100% interest in the Challacollo silver-gold project in Chile.
Under the terms of the Share Purchase Agreement, the Company will acquire 100% of the Chilean holding company which holds title to the project for an aggregate of:
- CA$500,000 cash to be paid within 7 days of Exchange Acceptance
- CA$500,000 cash to be paid on or before December 31st, 2019
- CA$1,000,000 cash to be paid on or before December 31st, 2020;
- CA$5,500,000 on or before April 30, 2021, to be paid, at Aftermath’s option, in Aftermath shares of up to a value of CA$2,750,000, and the balance in cash; provided that in no event shall the number of Aftermath shares issued represent more than 49% of Aftermath’s outstanding shares following such payment; and
- Mandalay to retain a 3% Net Smelter Return royalty on production, up to a maximum of CA$3,000,000.
Aftermath has the right to vary the April 30, 2021 payment by making an aggregate payment of $6,000,000, one half of which may be paid in Aftermath shares, such that the final payment is to be made on or before April 30, 2022.
Challacollo is a low-sulphidation epithermal deposit which hosts an historic Mineral Resource1 of 30 million silver ounce Indicated (4.7 million tonnes at 200 g/t silver) and a 6.9 million silver ounce Inferred (1.6 million tonnes of 134 g/t), with associated gold credits.
Previous drilling concentrated on the principal vein (Lolón Vein) to a depth of about 200 m below surface. Aftermath will focus its initial exploration efforts on parallel vein systems, not included in the historic Mineral Resource, that have some preliminary drilling. The oxidation level bottoms at approximately 200 m below surface; however, the down-dip extent of the mineralized structures remains unknown. Gold and base metal grades are generally observed to increase at depth.
Challacollo is located in Region I in Northern Chile, 130 km southeast of the major port city of Iquique and 50 km south of the town of Pica. The project is approximately 30 km east of the Pan American Highway, via Teck Resources’ Quebrada Blanca Copper Mine access road. The project is 139 km southeast of the major Pacific port city of Iquique. High voltage power transmission lines are located 15-30 km from the property, in part to service nearby mines of Collahuasi and Quebrada Blanca. The Project includes water rights.
Mr. Ralph Rushton, President and CEO of the Company, commented: “The acquisition of the high grade Challacollo silver project provides a platform for Aftermath to become a signficant silver-dominant exploration and development company. We are currently planning the 2020 exploration program and hope to start drilling in Q1, 2020.”
“I would like to thank Mandalay Resources for working with Aftermath Silver to complete this transaction. With the capital in hand to advance the project, we believe that the market conditions are ideal for the launch of a new silver company .” added Chairman, Michael Williams.
Peter Voulgaris, MAIG, MAusIMM, a consultant to the Company, is a non-independent qualified person as defined by NI 43-101. Mr. Voulgaris has reviewed the technical content of this news release, and consents to the information provided in the form and context in which it appears.
About Aftermath Silver Ltd
Aftermath Silver Ltd is a Canadian junior exploration company engaged in acquiring, exploring, and developing mineral properties with an emphasis on silver in Chile. The Company is focused of growth through the discovery and acquisition of quality projects in stable jurisdictions. Aftermath continues to seek new opportunities to take advantage of the relatively low silver price.
ON BEHALF OF THE BOARD OF DIRECTORS
Ralph Rushton, President & CEO
Notes on Mineral Resources
- Challacollo Historic Mineral Resource: An independent “Qualified Person”, as defined in National Instrument 43-101 (“NI 43-101”), has not done sufficient work on behalf of Aftermath to classify the historical estimate as a current indicated or inferred mineral resource, and Aftermath is not treating the historical estimate as a current mineral resource.
For full details please see the March 2015 43-101 Technical Report “NI 43-101 Technical Report for the Challacollo Silver Project, Region 1, Chile” QPs Mroczek, M., Collins, and M., Butler, S. of Mining Plus Canada Consulting Ltd. and Tapia, J.C., of Sedgeman S.A. Prepared for Mandalay Resources, available on the Mandalay Resources SEDAR profile.
- Challacollo mineral resources were classified according to the CIM Definition Standards for Mineral Resources and Mineral Reserves (December 2005).
- Mineral Resources are estimated at a cut-off grade of 60 g/t Ag.
- Mineral Resources are estimated using a silver price of US$24/oz, a gold price of US$1,400 per ounce, metallurgical recoveries of 92% for silver and 75% for gold, and operating costs of US$50 per tonne.
- A density of 2.45 g/cm3 is used as a base density with adjustments according to the variation of the estimated barium, lead and zinc grades.
- No capping of Ag grades has been applied due to low grade variability. Au grades have been capped at 3 g/t for two sample composites 4.57 g/t Au and 4.11 g/t Au respectively.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
Certain statements within this news release, other than statements of historical fact relating to Aftermath Silver, are to be considered forward-looking statements with respect to the Company’s intentions for the Cachinal Project in Chile. Forward-looking statements include statements that are predictive in nature, are reliant on future events or conditions, or include words such as “expects”, “goal”, “potential”, “anticipates”, “plans”, “believes”, “considers”, “significant”, “intends”, “targets”, “estimates”, “seeks”, attempts”, “assumes”, and other similar expressions.
The forward-looking statements are based on a number of assumptions which, while considered reasonable by Aftermath Silver Ltd, are, by their nature, subject to inherent risks and uncertainties and are not guarantees of future performance. Factors that could cause actual results to differ materially from those in forward-looking statements include: the interpretation of previous and current results, the accuracy of exploration results, the accuracy of Mineral Resource Estimates, the anticipated results of future exploration, the forgoing ability to finance these acquisitions further exploration and development, delays in the completion of exploration, the future prices of silver and gold, and other metals, and general economic, market and/or business conditions. There can be no assurances that such statements and assumptions will prove accurate and, therefore, readers of this news release are advised to rely on their own evaluation of the information contained within. In addition to the assumptions herein, these assumptions include the assumptions described in Aftermath Silver Ltd’s Management’s Discussion and Analysis for the three months ended August 31, 2019, as filed with the TSX Venture Exchange and available on SEDAR under Aftermath’s profile at www.sedar.com.
Although Aftermath Silver Ltd. has attempted to identify important risks, uncertainties and other factors that could cause actual performance, achievements, actions, events, results or conditions to differ materially from those expressed in or implied by the forward-looking statements, there may be other risks, uncertainties and other factors that cause future performance to differ from what is anticipated, estimated or intended. Unless otherwise indicated, forward-looking statements contained herein are as of the date hereof and Aftermath Silver Ltd. does not assume any obligation to update any forward-looking statements after the date on which such statements were made, except as required by applicable law.