Emgold and RIO Tinto Plc (Kennecott Exploration) Sign Earn-IN with Option to Joint Venture Agreement FOR the New York Canyon Property, Nv
EMGOLD MINING CORPORATION
Suite 1015 – 789 West Pender Street
Vancouver, B.C. V6C 1H2
www.emgold.com
February 11, 2020 TSX Venture Exchange : EMR
OTC : EGMCF
Frankfurt Exchange : EMLM
EMGOLD AND RIO TINTO PLC (KENNECOTT EXPLORATION)
SIGN EARN-IN WITH OPTION TO JOINT VENTURE AGREEMENT
FOR THE NEW YORK CANYON PROPERTY, NV
Vancouver, British Columbia - Emgold Mining Corporation (TSXV:EMR, OTC:EGMCF,
FRA:EMLM)) (“Emgold” or the “ Company”) announces it has signed an Earn-In with Option to Joint
Venture Agreement (the “Agreement”) with Kennecott Exploration Company (“Kennecott”), a subsidiary
of Rio Tinto PLC (LSE: RIO:L, ASE: RIO.AX NYSE: RIO.N) , for the New York Canyon Property,
Nevada (the “Property”). The Property hosts both copper oxide skarn and copper -molybdenum-gold-
silver sulfide porphyry mineralization in three known targets – Longshot Ridge, Copper Queen, and
Champion. Kennecott can earn up to a 75% interest in the Property by completing US$22.5 million in
exploration expenditures.
Key points of the Agreement include:
• Kennecott will have an option (the “First Option”) to acquire a 55 % undivided interest in the
Property by incurring US$5.0 million in expenditures over a 5 year period, of which US$1.0 million
is a committed expenditure that must be completed prior to the 18 month anniversary of the
Agreement.
• Kennecott will have a second option (the “Second Option”) to earn an additional 10% undivided
interest in the Property (for a total of 65%) by incurring an additional US$7.5 million in
expenditures over a 3 years period.
• Kennecott will have a third option (the “Third Option”) to earn an additional 10% undivided interest
in the Property (for a total of 75%) by incurring an additional US$10 million in expenditures over
a three year period.
• Any expenditure in excess of an option expenditure requirement in a given time period will be
credited against subsequent option expenditure requirements. Kennecott may, at any time or from
time to tim e, accelerate its satisfaction of the First, Second, or Third Option by paying Emgold
money in lieu of incurring expenditures.
• While earning in, Kennecott will have the right to make exploration and development decisions.
• Kennecott must maintain the Property in good standing during the option period( s), including
payment of BLM and County maintenance fees and any underlying property payments due to
Searchlight Resource Corporation (TSXV: SCLT) (“Searchlight”). Emgold currently has an
underlying agreement to acquire a 100 percent interest in the New York Canyon Property from
Searchlight, which required three payments over an 18 month period totaling CDN$300,000 (see
Emgold’s July 16, 2019 press release).
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• Kennecott will have the right to elect to form a joint venture (the “Joint Venture”) with Emgold
upon completion of either the First, Second, or Third Option. Upon establishing a Joint Venture
each participant will fund the joint venture according to its participating interest, with Kennecott
acting as the Manager of the joint venture. If a party’s participating interest falls below 10%, then
such parties participating interest will be converted to a 1% Net Smelter Royalty, capped at US$25
million.
In addition, Kennecott has staked 265 unpatented mineral claims at New York Canyon. This is in addition
to Emgold’s 152 unpatented mining claims and 21 patented mining claims. The 417 unpatented claims and
21 unpatented claims, totalling approximately 8,700 acres, are now combined under the Agreement and
make up the Property.
David Watkinson, President and CEO of Emgold stated, “ The Agreement with Kennecott represents
another successful example of Emgold’s business strategy of acquiring assets, adding value and monetizing
them through sale, option, joint venture or other business transactions. In this case, we are pleased to have
Kennecott earn -in and, if successful, become a joint venture partner with Emgold and take the lead to
advance New York Canyon.”
Qualified Person
Robert Pease, C.P.G., a qualified person under the NI 43- 101 instrument, has reviewed and approved the
content of this press release.
About Emgold
Emgold is a junior gold and base metal exploration company focused on Nevada and Quebec , the #1 and
#4 jurisdictions for mining investment according to the Fraser Institute’s Annual Survey of Mining
Companies, 2018. The Company’s strategy is to look for quality acquisitions, add value to these assets
through exploration, and monetize them through sale, joint ventures, option, royalty, and other transactions
to create value for our shareholders. Our Nevada properties, owned or under option, include Golden Arrow,
New York Canyon, Mindora, Buckskin Rawhide East, Buckskin Rawhide West, and Koegel Rawhide. Our
Quebec properties, owned or under option, include Casa South and a 50% interest in the East-West Property
(with option to increase ownership to 55%).
The Casa South Property is adjacent to Hecla Mining Corporation’s (NYSE: HL) operating Casa Berardi
Mine. Buckskin Rawhide East is an inlying property to Rawhide Mining LLC’s operating Rawhide Mine.
East-West is adjacent to and on strike with Wesdome Gold Mine Ltd.’s (TSX: WDO) Kiena Complex (past
producing Kiena Mine) and Osikso Mining Corporation’s ( TSX: OSK) Marban Block (past producing
Marban, Norlartic, and Kierrans Mines). Note that the location of Emgold’s properties adjacent to
producing or past producing mines does not guarantee exploration success at Emgold’s properties. Emgold
also has a strategic share investment in Troilus Gold Corporation ( TSX: TLG) which is advancing the
Troilus Gold Project in Quebec. For more information on the Company, investors should review the
Company's website at www.emgold.com or view the Company’s filings available at www.sedar.com.
On behalf of the Board of Directors
David G. Watkinson, P.Eng.
President & CEO
For further information, please contact:
David G. Watkinson, P.Eng.
Tel: 530-271-0679 Ext 101
Email: [email protected]
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Neither TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
release.
Cautionary Note on Forward-Looking Statements
Certain statements made and information contained herein may constitute “forward looking information” and “forward looking
statements” within the meaning of applicable Canadian and United States securities legislation. These statements and informat ion
are b ased on facts currently available to the Company and there is no assurance that actual results will meet management’s
expectations. Forward-looking statements and information may be identified by such terms as “anticipates”, “believes”, “targets”,
“estimates”, “plans”, “expects”, “may”, “will”, “could” or “would”. Forward-looking statements and information contained herein
are based on certain factors and assumptions regarding, among other things, the estimation of mineral resources and reserves, the
realization of resource and reserve estimates, metal prices, taxation, the estimation, timing and amount of future exploration and
development, capital and operating costs, the availability of financing, the receipt of regulatory approvals, environmental risks, title
disputes and other matters. While the Company considers its assumptions to be reasonable as of the date hereof, forward-looking
statements and information are not guarantees of future performance and readers should not place undue importance on such
statements as actual events and results may differ materially from those described herein. The Company does not undertake to
update any forward-looking statements or information except as may be required by applicable securities laws. The Company's
Canadian public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including
any technical reports filed with respect to the Company's mineral properties.