VANCOUVER, British Columbia,
June 28, 2018 /PRNewswire/ --
Kootenay Silver Inc. (TSXV:
KTN) (the "Company" or "Kootenay") is pleased to
announce that its wholly owned Mexican subsidiary has entered into
an option agreement ("Agreement") with Capstone Mining Corp. (TSX:
CS) ("Capstone Mining") on the Company's La Mina Project
("La Mina"), located 180
kilometers southeast of the city of Hermosillo in Sonora State, Mexico.
La Mina was staked by Kootenay as
part of its generative property portfolio strategy and covers the
upper levels of a zoned copper porphyry mineral system exposed over
a 2 by 2 kilometer area.
Kootenay President & CEO, James
McDonald stated: "We are pleased to have completed
the Agreement with Capstone Mining and are looking forward to have
them drill test this exciting copper porphyry system".
La Mina contains a large
leached argillized pyritic zone exposed at surface where surface
grab and chip samples taken averaged about 300 ppm copper. This is
consistent with leached zones above enriched copper deposits to the
north such as at La Caridad, where
the leached zone was in the 200 ppm range and overlaid an enriched
deposit of 0.7% copper.Click to view maps of copper (%) and gold
(gpt) rock samples taken within the leached pyrite shell.
The concessions also cover an exotica copper zone northwest of
the leached pyritic shell where sampling averaged 0.49% copper over
40 rock chip samples. This zone occurs over an approximate 100 by
700-meter area. Additionally, there is a peripheral zone of
silver-gold veins out bound from the copper porphyry which is
classic of zonation around porphyries. Kootenay discovered the area
while conducting a grass roots generative work program looking for
silver deposits. Click to view map of copper (%) rock samples
taken within the exotica copper and polymetallic vein zones.
The Agreement allows Capstone Mining to earn an initial 60%
("Initial Earn In") interest in La
Mina by making staged cash payments totalling US$600,000 and incurring exploration expenditures
totalling US$4 million over 4 years.
Following the Initial Earn In, Capstone may earn up to a 100%
interest in La Mina in stages by
completing certain milestones including preparation of a
preliminary economic assessment, a pre feasibility study and paying
an additional aggregate total of US$8.4
million to Kootenay in stages at each of the various
milestones.
The La Mina is subject to an
underlying information agreement (dated May
4, 2018) between the Company and a third party whereby, the
third party holds a net smelter return royalty ("Underlying
Royalty") of 2.5% on the concession. The Company has renegotiated
the right to purchase on or before the beginning of commercial
production up to 2% of the Underlying Royalty ("Buydown") in
increments of 0.25% for aggregate total of US$1.6 million. The Company will pay
US$20,000 and issue 142,000 common
shares of the Company to the third party upon acceptance of the TSX
Venture Exchange. If Capstone Mining earns 100% interest,
Kootenay will retain a 1% net smelter return with no buy out option
of which 0.5% will be held by the third party after giving effect
to the Buydown.
Qualified Persons
The Kootenay technical information in this news release has been
prepared in accordance with the Canadian regulatory requirements
set out in National Instrument 43-101 (Standards of Disclosure for
Mineral Projects) and reviewed on behalf Kootenay by James McDonald, P.Geo, President, CEO &
Director for Kootenay, a Qualified Person.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
About Kootenay Silver Inc.
Kootenay Silver Inc. is an exploration company actively
engaged in the discovery and development of mineral projects in the
Sierra Madre Region of Mexico and
in British Columbia, Canada.
Supported by one of the largest portfolios of silver assets in
Mexico, Kootenay continues to
provide its shareholders with significant leverage to silver
prices. The Company remains focused on the expansion of its current
silver resources, new discoveries and the near-term economic
development of two of its priority silver projects located in
prolific mining districts in Sonora, State and Chihuahua, State,
Mexico,
respectively.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS:
The information in this news release has been prepared as at
June 27, 2018. Certain statements in
this news release, referred to herein as "forward-looking
statements", constitute "forward-looking statements" under the
provisions of Canadian provincial securities laws. These statements
can be identified by the use of words such as "expected", "may",
"will" or similar terms.
Forward-looking statements are necessarily based upon a
number of factors and assumptions that, while considered reasonable
by Kootenay as of the date of such statements, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Many factors, known
and unknown, could cause actual results to be materially different
from those expressed or implied by such forward-looking
statements. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date made. Except as otherwise required by law,
Kootenay expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any such statements to
reflect any change in Kootenay's expectations or any change in
events, conditions or circumstances on which any such statement is
based.
Cautionary Note to US Investors: This news
release may contain information about adjacent properties on which
we have no right to explore or mine. We advise U.S. investors that
the SEC's mining guidelines strictly prohibit information of this
type in documents filed with the SEC. U.S. investors are cautioned
that mineral deposits on adjacent properties are not indicative of
mineral deposits on our properties. This news release may contain
forward-looking statements including but not limited to comments
regarding the timing and content of upcoming work programs,
geological interpretations, receipt of property titles, potential
mineral recovery processes, etc. Forward-looking statements address
future events and conditions and therefore involve inherent risks
and uncertainties. Actual results may differ materially from those
currently anticipated in such statements.
This press release uses the terms "Measured", "Indicated",
and "Inferred" resources. United
States investors are advised that while such terms are
recognized and required by Canadian regulations, the United States
Securities and Exchange Commission does not recognize them.
"Inferred Mineral Resources" have a great amount of uncertainty as
to their existence, and as to their economic and legal feasibility.
It cannot be assumed that all or any part of an Inferred Mineral
Resource will ever be upgraded to a higher category. Under Canadian
rules, estimates of Inferred Mineral Resources may not form the
basis of feasibility or other economic studies. United States investors are cautioned not to
assume that all or any part of Measured or Indicated Mineral
Resources will ever be converted into Mineral Reserves.
United States investors are also
cautioned not to assume that all or any part of a Mineral Resource
is economically or legally mineable.
Contact: James McDonald, CEO and
President at 403-880-6016; Ken
Berry, Chairman at 604-601-5652; 1-888-601-5650 or visit:
http://www.kootenaysilver.com