Magellan Gold Provides Update to Shareholders
RENO, NV - June 20, 2017 - InvestorsHub NewsWire - Magellan Gold
Corporation (OTCQB: MAGE) (Magellan or the Company), a U.S. based
mining and exploration enterprise focused on silver and gold, today
conveyed the following message to shareholders:
I want to take this opportunity to welcome our new shareholders
and to bring you up to date on the progress your company is making.
To reintroduce myself, my name is Pierce Carson. I hold a PhD in
economic geology from Stanford University and have managed the
discovery, financing, development and operation of mining
properties internationally and domestically during a career
spanning over forty years. I have led operating teams that have
been highly successful in developing new gold and copper mines.
Shareholders in the related companies saw dramatic stock pice
increases. Now, at Magellan, management aims to duplicate or better
that track record with the ultimate objective of creating
substantial value for Magellan shareholders.
Since I became CEO in June 2016, management has refocused the
company and developed a strategic plan to transform Magellan into a
viable operating company. Basic elements of the strategic plan are
(1) to complete the acquisition of the SDA flotation mill in the
State of Nayarit, Mexico, which, importantly, would enable the
company to achieve near-term production; (2) to expand the 16
million ounce historic silver resource at our flagship Silver
District Project, Arizona, with the view of advancing the project
towards development and production; and (3) to conduct initial
drilling of our Ninobamba, Peru silver-gold exploration property,
which holds promise for discovery of a large, disseminated
bulk-minable silver/gold deposit. Our overall goal is to build a
substantial mining company driven by cash flow and possessing a
portfolio of quality exploration and development projects for
future growth.
SDA Mill Acquisiiton, Nayarit, Mexico
On March 3, 2017, Magellan acquired a 150-day option to purchase
the SDA Mill from Rose Petroleum plc (Aim; ROSE) for consideration
of $1.0 million in cash and $500,000 in restricted common stock of
Magellan. The Company paid an intial $50,000 option fee on March 3,
2017, and on June 1, 2017 paid an additionl $100,000 option fee
that also will apply to the purchase price if the transaction
closes. Consumation of the mill purchase is subject to a number of
conditions, among others the Company completing a financing, and
there can be no assurance that the purchase will be completed.
The SDA Mill consists of an operational flotation plant,
precious metals leach circuit and associated assets. The mills
normal operation is based on sales of flotation concentrates to
smelters, and payment for precious metals content. Historically the
mill has operated for ten years, processing its own ore and also
engaged in toll milling for third party ore producers.
Management believes acquisition of the SDA Mill and
transformation of Magellan into a production company would be an
exciting development that would substantially enhance shareholder
value. The Companys strategy following the acquisition will be to
build production and increase cash flow through processing of ore
sourced from the regional gold belt where the mill is located.
Silver District Project, Arizona
Magellans flagship advanced exploration project is its 100%
owned district-scale Silver District Project in southwest Arizona.
The project encompasses three major epithermal vein structures
having a collective strike length of eight miles. Historical
drilling of 465 holes (62,866 ft) delineated 16.0 million ounces of
silver plus fluorspar available for open pit mining.
Magellans district-scale property position covers the heart of
the historic Silver District and includes all of the important
historical producers, most of the old mines and prospects and all
of the known exploration targets. Historic recorded production
during 1883-1893 from underground mines was 1.56 million ounces of
silver and 2.33 million pounds of lead.
Excellent potential exists to increase silver ounces through
deeper drilling, as historical drilling was limited to only 130 ft
vertical depth. Subject to funding, Magellan plans to conduct an
extensive drilling program to test strike and depth extensions of
the known vein deposits. The initial target potential is 60 million
ounces silver (1 million ounces gold equivalent). Following better
definition of the total size of the resource, the Company intends
to update previous metallurgical and engineering studies with the
objective of advancing the Silver District Project toward
development and production.
Niobamba Silver/Gold Project, Central Peru
On October 25, 2016, Magellan announced it had concluded a
definitive agreement with Rio Silver, Inc. (TSX.V: RYO) whereby
Magelan has the right to earn a 50% undivided interest in the
Niobamba Silver/Gold Project. To earn its 50% interest, Magellan
must spend $2.0 million in exploration over three years. Niobamba
is located in south-central Peru and offers ready access. The land
package includes a large, contiguous property comprising five
concessions totaling 36.5 square kilometers (9,027 acres).
Early mining in the area is known since colonial times, as early
as the 16th century. In more recent times, significant
historical exploration work has been conducted on the Niobamba
concessions by Rio Silver and several major companies. This
historical work provides the project with an an extensive database
comprising geological, geochemical, geophysical and drilling data,
as well as numerous silver, gold and combined silver-gold targets
in an historic silver mining district with positive infrastructure
in mining-friendly Peru.
Silver-gold mineralization on the concessions extends to over
six kilometers in an east-west direction. This mineralized trend is
extensively altered and contains a number of largely untested and
open-ended silver and gold anomalies, several of which appear to
represent excellent bulk mineable open pit targets. The Company is
particularly encouraged by results of historical drilling and
surface trenching, which returned potential ore grade
mineralization over substantial widths.
Niobamba holds potential for a large, bulk tonnage disseminated
silver/gold deposit. Mineralization reflects a high sulfidation
epithermal style that in Peru and elsewhere has produced world
class precious metals deposits.
As part of its earn-in agreement, Magellan committed to conduct
a 700-meter diamond drilling program in 2017. Magellan plans to
focus its initial drilling effort on areas trenched by Rio Silver
in 2012. As shown by results of seventeen trenches, two subparallel
zones of silver-gold and silver mineralization, the Niobamba North
Zone and the Niobamba South Zone, exhibit good continuity,
substantial widths and grades at surface and strike extents of 400+
meters. Mineralization demonstrates the potential for an
outcropping, bulk-tonnage, and disseminated-silver-gold deposit.
The goal of the drilling program will be to progressively outline a
Ni 43-101 silver-gold resource in these target areas.
About Magellan Gold Corporation
Magellan Gold Corporation (OTCQB: MAGE) is a US public
enterprise focused on the exploration and development of precious
metals. The Companys two mineral properties are located in Arizona
and in Peru.
The 100% owned Silver District Property in southwest Arizona
comprises over 2,000 acres covering the heart of the historic
Silver District. The property contains a near-surface historical
drilled resource of 16 million ounces of silver and exhibits
exploration promise for significant expansion. The Niobamba
Silver-Gold Property in central Peru, on which the Company has the
right to earn a 50% interest, covers 9,027 acres and demonstrates
potential for a large, bulk tonnage, silver-gold deposit.
To learn more about Magellan Gold Corporation, visit www.magellangoldcorp.com.
Cautionary Statement
The United States Securities and Exchange Commission permits
mining companies, in their filings with the SEC, to disclose only
those mineral deposits that a company can legally extract or
produce. Under SEC Industry Guide 7 standards, a final or bankable
feasibility study is required to report reserves. Currently we have
not delineated reserves on any of our properties. We cannot be
certain that any deposits at our properties will ever be confirmed
or converted into SEC Industry Guide 7 compliant "reserves."
Investors are cautioned not to assume that all or any part of any
resource estimates will ever be confirmed or converted into
reserves or that they can be economically or legally extracted.
Forward Looking Statements
This release contains forward-looking statements. Such
statements are based on good faith assumptions that Magellan Gold
Corporation believes are reasonable but which are subject to a wide
range of uncertainties and business risks that could cause actual
results to differ materially from future results expressed,
projected or implied by such forward-looking statements. Factors
that could cause actual results to differ from those anticipated
are discussed in Magellan Gold Corporations periodic filings with
the Securities and Exchange Commission.
Contacts:
Magellan Gold Corporation
Pierce Carson (505) 463-9223
John Power (707) 884-3766