Silver Elephant Announces the Sale of up to 800,000 Tonnes of Paca’s Silver Oxide Materials to Andean Precious Metals Corp.
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Silver Elephant Announces the Sale of up to
800,000 Tonnes of Paca’s Silver Oxide Materials to
Andean Precious Metals Corp.
Vancouver, British Columbia, September 1 2, 2023 — Silver Elephant Mining Corp.
(“Silver Elephant” or the “Company” ) (TSX: ELEF, OTCQX:SILEF , Frankfurt:1P2N) is
pleased to announce the Company’s Bolivian subsidiaries (“Silver Elephant Subsidiaries”) have
entered into an exclusive sales and purchase agreement (“the SPA”) for the sale of up to
800,000 tonnes of silver-bearing oxide materials (the “ Products”) from the Company’s Paca
project located in Potosi department, Bolivia (the “ Paca Project”) to Andean Precious Metals
Corp.’s (“Andean”) (TSX-V: APM) (OTCQX: ANPMF) Bolivian subsidiary (“Andean Subsidiary”).
Pursuant to the SPA, the Andean Subsidiary will purchase the Products to be delivered to
Andean Subsidiary’s plant (the “Facility”) in Potosi , which is approximately 191 km from the
Paca Project. Andean Subsidiary will reimburse Silver Elephant Subsidiaries certain operating
expenses and other expenses under the SPA, which will expire on the earlier of January 31,
2029, or when a total of 800,000 tonnes of Products have been delivered to the Facility (“the
Term”).
Silver Elephant’s CEO John Lee comments: “Andean is Silver Elephant’s ideal partner given
Paca oxide’s high silver recovery at Andean’s commercial oxide facility, and Andean’s financial
strength. The proposed transaction will create jobs in the Pulacayo ar ea and in the local
indigenous Ayllu and deliver substantial royalty revenues to the Bolivian government. Sulphide
extraction at Paca is planned after the initial oxide layer is removed.”
The Paca project hosts an indicated resource of 6.5 million oz of si lver (1,095,000 tonnes
grading 185 g/t Ag) in oxide form near surface estimated by Mercator in a NI43 -101 technical
report dated October 20, 2020.
Paca Zone Category Tonnes Ag g/t Ag Moz AgEq
Phase 1 Oxide (In-pit) Indicated 1,095,000 185 6.5 Inferred 345,000 131 1.5
Phase 2 Sulfide (In-pit) Indicated 20,595,000 46 30.5 106
Inferred 3,050,000 46 4.5 94
Separately, the Company has entered into a Master Services Agreement (the “ MSA”) with
Andean to provide its expertise in mining operations, community relations, logistics and access
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to all its technical and geological information for Paca. In exchange, Andean will pay Silver
Elephant an aggregate of US$5,000,000 (the “Cash Consideration”) as follows:
(i) Non-refundable US$1,200,000 in cash on signing of the MSA;
(ii) Non-refundable US$1,800,000 in cash by January 31, 2024;
(iii) Non-refundable US$1,500,000 in cash before January 31, 2025; and
(iv) Non-refundable US$500,000 in cash by January 31, 2026.
In addition to the Cash Consideration, if the London Bullion Market Association silver spot price
averages over (the “Additional Consideration”):
(i) US$28/oz in any given 260 trading day -interval during the Term, then Andean
will pay Silver Elephant a one-time payment of US$1,000,000 in cash; and
(ii) US$32/oz in any given 150 trading day -interval during the Term, then Andean
shall pay Silver Elephant a one-time payment of US$1,000,000 in cash.
Once either of the above payment is made, the applicable trading day-interval resets to zero for
the other remaining Additional Consideration.
The Paca project is part of the Company’s Pulacayo project with a total indicated resource of
106.7 million oz silver, 1.4 billion pounds of zinc and 690 million pounds of lead published in the
October-2020 Mercator report. Silver Elephant and its subsidiaries have spent over $35 million
on Pulacayo and Paca, which is considered to be an advanced mining project with over 96,000
meters of drilling, and a historic feasibility study.
A subsidiary of Silver Elephant entered into a Mining Production Contract (“MPC”) with
Corporación Minera de Bolivia (“COMIBOL”), a branch of the Bolivian Min istry of Mining and
Metallurgy on October 3, 2019. The MPC grants this subsidiary the 100% exclusive right to
develop and mine at the Pulacayo and Paca concessions for up to 30 years.
The Pulacayo Project is at the center of a thriving Bolivia silver mining district and is within 250
km driving distance to the San Cristobal mine, the Cerro Rico mine, Pan American’s San
Vicente mine, Eloro’s Iska Iska project, and New Pacific’s Silver Sands project.
Qualified Person
The technical contents of this news release have been prepared under the supervision of Bill
Pincus, who is an independent consultant of the Company. Bill Pincus is a qualified person as
defined by the guidelines of NI 43-101.
About Silver Elephant Mining Corp.
Silver Elephant Mining Corp. is a premier silver mining and exploration company, with its
flagship Pulacayo silver project in Bolivia.
Further information on Silver Elephant can be found at www.silverelef.com.
SILVER ELEPHANT MINING CORP.
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ON BEHALF OF THE BOARD
“John Lee”
Executive Chairman
For more information about Silver Elephant, please contact Investor Relations:
+1.604.569.3661 ext. 101
[email protected] www.silverelef.com
Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy
or accuracy of this release.
FORWARD-LOOKING INFORMATION
This news release contains “forward -looking information” and “forward -looking statements”
(collectively, “forward-looking information”) within the meaning of applicable securities laws.
Forward-looking information is generally identifiable by use of the words “believes,” “may,”
“plans,” “will,” “anticipates,” “intends,” “could”, “estimates”, “e xpects”, “forecasts”, “projects” and
similar expressions, and the negative of such expressions. Forward -looking information in this
news release may include statements about the future purchase of Products by the Andean and
its subsidiaries, the receipt of permits and approval at the Paca Project, the development of a
mining plan for the Paca Project, and the receipt of proceeds under the Agreement.
Forward-looking information is subject to known and unknown risks, uncertainties and other
factors that may cause the Company ’s actual results, level of activity, performance or
achievements to be materially different from those expressed or implied by such forward-looking
information.
Forward-looking information is based on the reasonable assumptions, estimates, analysis and
opinions of management made in light of its experience and perception of trends, current
conditions and expected developments, and o ther factors that management believes are
relevant and reasonable in the circumstances at the date such statements are made. Although
the Company has attempted to identify important factors that could cause actual results to differ
materially from those co ntained in forward -looking information, there may be other factors that
cause results not to be as anticipated. There can be no assurance that such information will
prove to be accurate, as actual results and future events could differ materially from thos e
anticipated in such information, and there is no guarantee that the Transaction will yield positive
results for the Company . Accordingly, readers should not place undue reliance on forward -
looking information. All forward -looking information herein is qu alified in its entirety by this
cautionary statement, an d the Company disclaims any obligation to revise or update any such
forward-looking information or to publicly announce the result of any revisions to any of the
forward-looking information contained herein to reflect future results, events or developments,
except as required by law.