TORONTO, ONTARIO--(Marketwired - Nov 5, 2013) - Argonaut Gold Inc. (AR.TO) (the "Company", "Argonaut Gold" or "Argonaut") is pleased to announce they have signed an agreement pursuant to which the Company will acquire the San Agustín project, located 10 kilometers from the their El Castillo project in Durango, Mexico, from Silver Standard Resources (SSO.TO) ("Silver Standard Inc.").
Under the terms of the agreement, Argonaut Gold will purchase San Agustin for aggregate consideration of:
- $15 million cash payable at closing;
- $30 million of Argonaut shares issued at closing (based on the 5-day volume weighted average sale price for Argonaut shares trading on the TSX prior to signing the definitive agreement);
- $10 million cash payable six months after signing the definitive agreement; and
- $20 million cash payable eighteen months after signing the definitive agreement.
Completion of the transaction is subject to customary closing conditions, including receipt of required regulatory and TSX approvals. Argonaut Gold expects the transaction to close in the first quarter of 2014. Silver Standard will also retain a 2% NSR interest on all sulphide hosted mineralization.
The San Agustín project hosts an indicated resource of 1.6 million ounces of gold and 48 million silver ounces within 121 million tonnes. In addition, the project carries an inferred resource of 1.06 million gold ounces and 37 million silver ounces within 91.2 million tonnes.
San Agustin Mineral Resources
|Ore Type||Classification||Tonnes (Million)||Au (g/t)||Ag (g/t)|
Peter Dougherty, President and CEO of Argonaut Gold said, "Argonaut is very pleased to add this project to our portfolio. The San Agustín project is 10 kilometers from our operating El Castillo mine in Durango, Mexico and the mineralization is hosted on the same geologic setting. We anticipate that proximity of the two projects will allow for operational synergies and in addition to sharing resources and infrastructure, operational and geological knowledge acquired at El Castillo will be utilized in the development of San Agustín."
"The mineral system has an oxidized cap which hosts approximately 400k ounces of gold and 16.4 million ounces of silver. Argonaut's near term exploration objectives include in-fill and step out drilling of the known oxide resource. Current near surface oxide mineralization remains open in all directions and the exploration potential is considered excellent. Argonaut will also be conducting additional metallurgical work on the project."
Argonaut will host a conference call to discuss the purchase of San Agustín on November 6, 2013 at 5:30 am PST/8:30 am EST
|Conference Call Information:|
|Toll Free (North America):||1-866-696-5910|
|Conference Call Replay:|
|Toll Free Replay Call (North America):||1-905-694-9451|
|International Replay Call:||1-800-408-3053|
The conference call replay will be available from 10:30 a.m. ET on November 5, - November 20, 2013.
About Argonaut Gold
Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production stage El Castillo Mine in Durango, Mexico and the La Colorada Mine in Sonora, Mexico, the advanced exploration stage San Antonio project in Baja California Sur, Mexico, the advanced exploration stage Magino project in Ontario, Canada and several exploration stage projects, all of which are located in North America.
Creating Value Beyond Gold
Qualified Person, Technical Information and Mineral Properties Reports
Preparation of this release was supervised by Thomas Burkhart, Argonaut Gold's Vice President of Exploration, and a Qualified Person under NI 43-101.
For further information on the San Agustin project please see the technical report title "San Agustin Resource Estimate" dated March 2009 and available under Silver Standard at www.sedar.com. Both Gold ounces and Silver ounces have been reported by Silver Standard per their mineral resources statement. Per Silver Standard, Mineral Resources estimate was completed by Gilles Arseneau, Ph.D., P.Geo., a Qualified Person, pursuant to NI 43-101, in a technical report completed by Wardrop, a TetraTech company, entitled "San Agustin Resources Estimate" dated March, 2009.
This report was reviewed by Thomas Burkhart on behalf of Argonaut Gold. To the best of Argonaut Gold's knowledge, information and belief, there is no new material, scientific or technical information that would make the disclosure of the mineral resources inaccurate or misleading.
Cautionary Note Regarding Forward-looking Statements
This press release contains certain "forward-looking statements" and "forward-looking information" under applicable Canadian securities laws concerning the proposed transaction and the business, operations and financial performance and condition of Argonaut Gold Inc. ("Argonaut"). Forward-looking statements and forward-looking information include, but are not limited to, statements with respect to estimated production and mine life of the various mineral projects of Argonaut; synergies and financial impact of completed and contemplated acquisitions; the benefits of the development potential of the properties of Argonaut; the future price of gold, copper, and silver; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; success of exploration activities; and currency exchange rate fluctuations. Except for statements of historical fact relating to Argonaut, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Many of these assumptions are based on factors and events that are not within the control of Argonaut and there is no assurance they will prove to be correct.
Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include failure to achieve anticipated synergies, changes in market conditions, variations in ore grade or recovery rates, risks relating to international operations, fluctuating metal prices and currency exchange rates, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses, labour disputes and other risks of the mining industry, failure of plant, equipment or processes to operate as anticipated. Although Argonaut has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Argonaut undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements. Statements concerning mineral reserve and resource estimates may also be deemed to constitute forward-looking statements to the extent they involve estimates of the mineralization that will be encountered if the property is developed. Comparative market information is as of a date prior to the date of this document.
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