(Orvana Minerals, 21.May.2021) — Orvana Minerals Corp. (TSX: ORV) completed the requisite steps to transfer ownership of the Taguas property to Orvana Argentina S.A., a wholly-owned subsidiary of the company. The Taguas acquisition is now complete. The Taguas property consists of 15 mining concessions over an area of 3,273.87 ha. The Property is located in the Province of San Juan, Argentina, on the eastern flank of the Andes, between 3,500 m to 4,300 m above sea level, and is approximately 25 km north of Barrick Gold Corporation‘s Veladero mining operations (see Figure 1 below).
Juan Gavidia, CEO of Orvana stated, “The company is pleased to officially add the Taguas property as its potential third operation to target growth of our mineral reserves and resources. Subject to results of the latest drilling program and the availability of funds, the company plans to further develop Taguas by completing an infill drilling program to upgrade resources from inferred to measured-indicated, and develop baseline studies for a pre-feasibility study. This is a perfect addition to our platform. Our Orovalle Spanish mine is now producing 55,000 oz/year of gold and gold equivalent and our Bolivian stockpile project, EMIPA, will hopefully restart operations in 2022.”
The Taguas Property was acquired from Compañía Minera Taguas S.A. (the “Vendor”). As consideration for 100% of the Taguas Property, Orvana granted an indivisible net smelter royalty equal to 2.5% on all future metals production mined from the Property. The Vendor indirectly owns 51.9% of the issued and outstanding common shares of Orvana, and therefore is a related-party for purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). Orvana is exempt from the requirements to obtain a formal valuation or minority shareholder approval in connection with the acquisition of the Taguas Property by virtue of sections 5.5(a) and 5.7(a), respectively, of MI 61-101, as neither the fair market value of the Property, nor the fair market value of the consideration for the Property exceeds 25% of the company’s market capitalization as calculated in accordance with MI 61-101. The company did not file a material change report related to this acquisition more than 21 days before the expected completion of the transfer of the Property to Orvana Argentina, S.A., as the date to finalize the transfer could not be definitively confirmed until shortly beforehand, and the company wished to complete the transfer on an expedited basis for sound business reasons. The acquisition of Taguas was considered and unanimously approved by the board of directors of the company.
The Toronto Stock Exchange (TSX) has provided acceptance of the acquisition, conditional on the receipt of copies of executed agreements by the close of business day following the closing of the acquisition.
A drilling campaign to enlarge the mineral resource commenced in February 2021 and was completed in April 2021 with a total of 4,689 meters drilled. Distribution of meters drilled is illustrated at Figure 2 and is described as follows:
- 3,455.4 meters in Cerros Taguas to enlarge oxide resources (principal target of this campaign);
- 733.5 meters in Cerro Campamento with the aim of testing continuity of mineralized structures towards the southwest; and 500 meters in CARDS target 1 & 2 to explore the area potential.
Laboratory assays and evaluation of the data collected during the drilling program is in progress, and is expected to be completed by late May. A new Mineral Resource Estimate is being updated in compliance with Canadian National Instrument 43-101, by Geosim Services Inc, an independent consulting firm, and is expected to be completed by the third quarter of fiscal 2021.