Fidelity Minerals Provides Key Project & Corporate Update
Fidelity Minerals Provides Key Project & Corporate Update
• Acceleration of the Greater Las Huaquillas project appraisal strategy.
• Pre-commissioning capital estimates for Cerro Dorado nearing completion. Negotiations for
securing multi-year ore feedstock for Cerro Dorado are ongoing and progressing well.
• Potential major project acquisition and M&A opportunities.
• Bahay Ozcakmak appointed executive chairman and advisory board established.
• Market-making services provider VLP engaged by the Company.
Vancouver, BC, March 13th, 2019 – Fidelity Minerals Corp. (TSX-V: FMN | FSE: S5GM | SSE:
MNYC) (“Fidelity Minerals” or the “Company”) is pleased to provide the following update.
Greater Las Huaquillas (GLH) Project, Cajamarca Province, Northern Peru
The Company has recently acquired a comprehensive geoscientific database consisting of all the
historic drilling, trenching, geochemical, assay certificate and underground drawing data files
generated by past project owners between 1988 and 2012; the datas et includes drill hole cross
sections assembled via Kilborn Engineering (since acquired by SNC -Lavalin), from work
performed prior to 1998. The historic holders of the project include ProInversion, the Government
of Peru agency involved with mining (where underground vein exploratory mining occurred jointly
between INGEMMET and BGR (Germany) starting in 1988), Sulliden (geochemistry, drilling,
underground re-assay in 1997 – 98) as well as the most recent project operator. There has been no
systematic technical work undertaken at the GLH project since 2012.
Following the acquisition of a 44.5% interest in the Core Las Huaquillas concessions (3,600 Ha)
and the subsequent acquisition of 9 additional concessions (3,800 Ha) by the Company on a 100%
basis, the company has continued its review of regional prospectivity and has recently applied for
further concessions increasing the strategic land holding of the GLH by a further 3,000 Ha. This
additional land holding increases the total GLH project area to 10,400 Ha , with more than 65% of
the project area wholly owned by the Company, providing maximum operational flexibility.
GLH Strategic Consulting Agreement
Fidelity Minerals and a leading Australian geoscience consulting company, Global Ore Discovery
Pty Ltd (“Global Ore”), are pleased to an nounce the signing of a strategic consulting agreement
that will initially focus on the rapid appraisal of the GLH project. Under the terms of the agreement,
Global Ore will also provide geological consulting services on an ex clusive basis for an initial
twelve-month period within Cajamarca Province, to assist Fidelity Minerals in the appraisal of
additional precious and base metal opportunities. The Cajamarca Province hosts a number of world
class gold and copper mines includi ng Newmont’s Yanacocha gold mine, the largest epithermal
gold deposit globally, with a total gold endowment in excess of 50M oz.
Global Ore has a successful track -record of providing consulting services to rapidly advance
projects from exploration through to resource appraisal stage. The consultancy has contributed to a
number of grass roots precious metal discoveries and the delineation of new +1M oz gold resources
within operating mine environments, in South America and the Asia Pacific. Global Ore has also
played a role in supporting clients to establish partnerships and farm -out transactions with
Australian and North American precious and base metal producers.
Under the agreement Global Ore will receive 600,000 shares and 600,000 options in Fidelity
Minerals and Fidelity Minerals will further pay Global Ore for its profession al services. The
agreement also includes material performance milestones focused on near -term resource
delineation, which under certain circumstances may trigger the payment of additional success fees
to Global Ore.
The acquisition of the historic Las Hua quillas project data is a critical step in the assembly of
information for the integrated interpretation of the Greater Las Huaquillas project for near -term
appraisal of known mineralisation and compelling gold, copper, lead and zinc targets. The
acquisition of the historical project information positions Fidelity Minerals to rapidly advance the
appraisal of the Greater Las Huaquillas project. Whilst the Company has already received third -
party interest in the GLH project, Fidelity Minerals is focused on ra pidly advancing the project to
a stage where a formal farm-out process can be launched later in 2019”, said Ian Graham, CEO of
the Company. “In that regard, I am pleased to announce the signing of our agreement with Global
Ore Discovery, who brings to the table significant experience in project appraisals and the
structuring of farm-out agreements in South America”.
Cerro Dorado Gold Mill Project
The Company is nearing completion of the pre-commissioning capital budget review, to further
revise the budget reviewed by Ausenco Peru in May 2018, in order to enable the Company to make
a final investment decision to recommission the plant at the earliest opportunity (subject to funding).
The Company is currently in negotiations with several resource project owners with the objective
of securing feedstock for Cerro Dorado where the Company intends to acquire a direct interest in
the ore, preferably through ownership of the underlying asset. The expectation is that the preferred
ore supply pathway will result in sufficient feed stock supply for the plant for several years of
operations, including at the planned upgraded plant capacity of 115TPD.
New Advanced Stage Polymetallic Project
The Company has entered into agreements to acquire a potential minority interest in a polymetallic
resource project located in Peru. The transaction remains subject to certain due diligence items and
to ongoing discussions with the various project vendors in relation to the ultimate project ownership
and future plans. The Company considers this undisclosed project to represent an exciting
opportunity as the project is already permitted and has the potential capacity to commence small -
scale mining operations almost immediately. Notwithstanding the best efforts of the Co mpany,
including payment of an initial consideration, the Company cautions that at this preliminary stage
the Company cannot be certain that the envisaged transaction will be completed. The Company will
provide further updates as and when material new information becomes available.
Board Restructure and Establishment of Advisory Board
Executive Chairman Appointed
Current Fidelity Minerals executive director Bahay Ozcakmak has agreed to assume the role of
Executive Chair effective immediately. Bahay joined the Fidelity Minerals board on June 14, 2018
as a director, and has been leading the restructure of the company, including the development and
implementation of major grow th plans, encompassing the recently announced acquisitions. Bahay
is a corporate strategy expert with extensive M&A, business development & corporate restructuring
experience including CEO and director level roles in the energy and resources sectors. Currently,
Bahay is a director of several mining focused companies, including Activated Water Technologies,
Consolidated Potash Corporation and Lions Bay Capital Inc., Fidelity Minerals Corp’s largest
shareholder.
“Recent corporate activity in the gold sector is highlighting the increasing investor interest in the
sector and interest in high quality appraisal stage projects in particular. Our timing to relaunch
Montan Mining as Fidelity Minerals and embark on a strat egic project acquisition initiative
appears well timed. During the last 8-9 months, the Fidelity Minerals team has worked diligently to
put the foundations in place in order to support the transition of the company from survival-mode,
into a more sustained and systematic growth mode. We have a capable team, great foundation in a
fully operational CIP plant in Cerro Dorado which we plan to recommission shortly, and a pipeline
of material appraisal-stage project opportunities that are quite unusual for a company of our size”
states Bahay Ozcakmak.
Advisory Board
As the Company embarks on a number of important growth initiatives, in order to provide the board
with strategic support, the Company has established an Advisory Board composed of seasoned
mining professionals that have spent the majority of their extensive careers building successful
mining operations around the world.
The founding members of the Advisory Board consist of Mr. John Byrne, Mr. Leonard (Len) De
Melt and Mr. Greg Hall. The Advisory Board will be chaired by Mr. John Byrne.
John Byrne has 40 years of experience in the natural resource industry as a financial analyst, investor
and mine developer. He formed Cambrian Mining Plc in 2002 with net assets of £1.4 million and
before being acquired in 2008 had net assets of GBP£149 million. John has been Chairman and
CEO of numerous successful resource companies, including Western Coal Corp which was
capitalised at less than C$1 million when he joined, and was sold for C$3.3bill ion in 2010. He is a
founder of Lions Bay Capital, Fidelity’s largest shareholder.
Len De Melt is widely recognized within the mining industry. He has been involved with 10
properties which became mines, including Hudbay’s Constancia mine in Peru (Cu), H omestake’s
Golden Bear mine (Au), Goldust’s Croiner mine (Au), and BHP’s Ekati mine (diamonds). He has
been Chairman of International Norsemont Ventures which subsequently went through a name
change and, in 2011 was sold to Hudbay Minerals for US$520 milli on. Mr. De Melt resigned as
director and officer of Norsemont Mining in 2006.
Greg Hall has 30 years experience in advancing international exploration, development, and mining
ventures, and all aspects of their structuring and finance. Greg is currently President of Water Street
Assets and Director of Prophecy Development. Previously a director of Silvercorp Metals, China’s
largest primary silver producer and one of the lowest cost silver producers among its industry peers.
Other former appointments include: Director at Haywood Securities; VP at Canaccord Genuity; and
Senior VP at Leede Jones Gable.
About Fidelity Minerals Corp.
Fidelity Minerals Corp. is an emerging gold producer focusing on assembling and unlocking value
from a pipeline of advanced stage mining assets in Peru. The company is backed by an experienced
management team with diverse technical, market, and commercial expertise and is supported by
committed and sophisticated investors focused on building long term value, now anchored by Lions
Bay Capital Inc.
On behalf of the Board of Fidelity Minerals.
Ian Graham
CEO and Director
Tel: +1.604.671.1353
Email: [email protected]
For more information, please visit the corporate website at http://www.fidelityminerals.com or
contact:
Investor Contacts:
Bahay Ozcakmak
Executive Chairman
Tel: +61.3.9236.2800
Email: [email protected]
Luis F. Zapata
Director
Tel: +1.604.358.1382
Tel: +51.999.968.827 (Peru)
Email: [email protected]
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE
EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF
THIS NEWS RELEASE.
Disclaimer & Forward-Looking Statements
This news release contains forward-looking statements. Forward-looking statements are statements that relate to future
events or future financial performance. In some cases, you can identify forward -looking statements by the use of
terminology such as “may”, “should”, “intend”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “project”,
“predict”, “potential”, or “continue” or the negative of these terms or other comparable terminology. These statements
speak only as of the date of this news release. This news release may also contain inferences to future oriented financial
information (“FOFI”) within the meaning of applicable securities laws. The information in this news release has been
prepared by our management to provide a context for the project arrangements made with Global Ore and to provide
the reader with an outlook for our future activities and anticipated key projects and may not be appropriate for other
purposes. Forward-looking statements in this announcement include, (but are not limited to), i) that we will successfully
start-up Montan Mining’s Cerro Dorado plant, and that ii) we will be able to successfully appraise the Greater Las
Huaquillas project. The Cerro Dorado S.A.C. assets have not been the subject of a feasibility study and as such there
is no certainty that the mine or the mill will be able to produce a commercially marketable product. There is a significant
risk that any production efforts from the project will not be profitable with these risks elevated by the absence of a
defined resource and economic study. The Company’s reliance on historic production and third party gold recovery
statistics is necessary under the circumstances, but is not compliant with NI 43 -101 reporting st andards. There are
increased risks and uncertainty in making a production decision without such a study and an historically higher rate of
failure for production decisions not based on a feasibility study. General risks include the reliance on available da ta
and assumptions and judgments used in the interpretation of such data, the speculative and uncertain nature of
exploration and development, exploration and development costs, capital requirements and the ability to obtain
financing, volatility of global and local economic climates, share price volatility, estimate price and commodity price,
volatility, changes in equity markets, increases in costs, exchange rate fluctuations and other risks involved in the
mineral exploration and development industry. Th ere can be no assurance that a forward -looking statement or
information referenced herein will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such statements or information. Also, many factors, t hough considered, are beyond our control.
Accordingly, readers should not place undue reliance on forward -looking statements or information. We undertake no
obligation to reissue or update any forward -looking statements or information except as required by law. This
announcement is not, and under no circumstances is to be construed as, a solicitation or an offer of any kind. The
matters set forth in this announcement does not constitute an agreement or offer that may be accepted. Accordingly, no
person may bring a claim or action against another for a failure to negotiate, agree or enter into any agreement with
respect to matters contained in the announcement. The technical information in this announcement relating to Cerro
Dorado has been prepared in accord ance with the Canadian regulatory requirements set out in National Instrument
43-101 (“NI 43-101”) and has been reviewed and approved on behalf of the Company by Mr. Dean Pekeski, P. Geo.,
of Kraven Geological Inc., a Qualified Person under NI 43 -101. The technical information in this announcement
relating to the Greater Las Huaquillas project has been derived from: NI 43 -101 Technical Report (the “Technical
Report” ) on the Las Huaquillas Au, Ag, Cu Property, Cajamarca, Peru (15 August 2011) prepared by Lu c Pigeon,
P.Geo., of Gateway Solutions SAC, a Qualified Person under NI 43-101. Mr. Pigeon has been a source of data acquired
by the Company. Fidelity Minerals has not sought any form of consent from either the Qualified Person, or the Issuer
which commissioned the Technical Report, but rather references this Technical Report in an historical context as the
report was originally submitted for exchange approval on 15 August 2011. It should be noted that there has not been
sufficient drilling and/or sufficien t previous exploration at Las Huaquillas upon which to base a mineral resource or
mineral reserve estimate compliant to the current standards of National Instrument 43-101, and Fidelity Minerals Corp
has not undertaken any independent verification of the d ata contained in that report by a Qualified Peron or Persons
acting for the Company. There has been no additional or independent verification site visit, sampling or analytical work
undertaken by Fidelity Minerals Corp with respect to the Las Huaquillas pr operty. The Company has relied entirely
upon historic disclosure relating to the Las Huaquillas project in making decisions relating to the Project, and in
preparing this news release and past news releases.