Mundoro Announces Earn-IN Agreement with Vale FOR Exploration of Four Serbian Timok Licenses
LEGAL*46281289.2
MUNDORO ANNOUNCES EARN-IN AGREEMENT WITH VALE FOR EXPLORATION OF FOUR SERBIAN
TIMOK LICENSES
October 7, 2019, Vancouver, BC - Mundoro Capital Inc. (TSXV: MUN, www.mundoro.com) ("Mundoro"
or the "Company") announces it has entered into an earn-in agreement ("Agreement") with Vale Canada
Limited ("Vale"), in which Mundoro has granted to Vale an option to earn -in to four of Mundoro’s
exploration licenses: Sumrakovac, Osnic, Dubrava and Padina (the “ Vale-Mundoro Projects ”) located
within the Timok Magmatic Complex (“Timok”) in Serbia. Timok is one of the most prolific metallogenic
domains in the Tethyan Belt. Timok hosts the Cukaru -Peki deposit and the producing mines: the Bor
copper porphyry underground mine and the Veliki Krivelj copper-gold porphyry open-pit mine (“Bor Mine
Complex”) (see Figure 1: Location Map).
Teo Dechev, CEO and President of Mundoro commented, “Mundoro is pleased to welcome Vale as our
latest partner in Serbia , which reflects the prospectivity of Mundoro’s land package within the Timok
region and demonstrates the growing interest in this region.”
Terms Overview
Pursuant to the Agreement, Mundoro has granted to Vale an option to earn, over two primary phases, up
to a 75% interest in the Vale-Mundoro Projects by sole funding expenditures of up to US$45 million (C$60
million) as follows:
Phase One:
● Vale has the right to earn a 51% interest in the Vale -Mundoro Projects by sole -funding US$5
million (C$7 million) in expenditures over 3 years from satisfaction of the due diligence condition
(“Phase One”).
● Mundoro will be the operator of the Vale-Mundoro Projects in Phase One.
Phase Two:
● Following Phase One, Vale has the right, exercisable within 60 days, to elect to enter P hase Two,
whereupon it can earn an additional 24% interest in the Vale -Mundoro Projects, for a total 75%
interest, by sole -funding an additional US$40 million (C$53 million) in expenditures (the “Phase
Two Option”) by the fifth anniversary of the election date.
● If Vale (a) elects not to enter Phase Two, or (b) does not satisfy the Phase Two Option, then Vale
will pay to Mundoro an annual fee of US$150,000 (C$198,550) (“Annual Payment”). Annual
Payments cease upon commencement of commercial production. All Annual Payments will be
credited against future payment obligations under the NSR.
Additional Terms:
● The parties have agreed to establish a new Serbian corporation as the legal vehicle representing
the earn-in/joint venture and to hold the relevant licenses and permits; the earn-in period will
commence once all relevant organizational matters and transfers relating to the new corporation
have been completed. On completing Phase Two, Vale will have a right, exercisable for a period
of 60 days, to purchase an additional 5% interest in the Vale-Mundoro Projects from Mundoro,
for a total of 80% interest. The purchase price for the 5% interest will be based on a calculation
of the fair market value as determined by an independent appraisal. If Mundoro’s interest in the
joint venture is reduced below 10% through dilution, Mundoro’s interest will be converted to a
2% Net Smelter Returns Royalty (“NSR”) subject to Vale’s right to reduce the NSR to a 1% NSR by
making a fixed price payment to Mundoro.
Project Information
LEGAL*46281289.2
Overview of Sumrakovac
Sumrakovac license is 106 sq.km area located 5 km southwest of the Bor Mine Complex and 4 km west of
the Cukaru -Peki high sulphidation Cu -Au deposit and hosts porphyry copper -gold styl e mineralisation.
Main target is the Skorusa hydrothermal system, 4.5 km by 2 km of pervasive argillic-phyllic alteration
hosting two porphyry centers Skorusa West and Skorusa East. Skorusa West target hosts a zone with
potassic alteration and associated Quartz-stockwork mineralisation at surface, extending NE-SW for about
200 m along strike. Surface rock sampling of the Quartz-stockwork returned 23m @ 0.72 g/t Au and 0.17%
Cu.
Work completed to date at Sumrakovac includes geological mapping, soil and roc k sampling and
geophysical surveys. Mundoro drill programs include 9 diamond drill holes totalling 2896m and 6 reverse
circulation (RC) holes totalling 609m drilled within the Skorusa hydrothermal system 4.5km by 2km and
aimed to test various targets. The drilling confirmed the existence of a large porphyry related alteration
system with at least two mineralized centers (Skorusa West and Skorusa East). Drilling at Skorusa West
successfully confirmed gold -copper mineralisation related to stockwo rk veining as part of a multiphase
porphyry system. The mineralisation remains open laterally and vertically down plunge to the WNW.
Some of the significant results are:
● 63.4m @ 0.30 g/t Au and 0.11% Cu from 71.6m; drill hole SUMDD001
● 60.0m @ 0.30 g/t Au and 0.14% Cu from 54.0m; drill hole SUMDD002
● 36.0m @ 0.21 g/t Au and 0.19% Cu from 289m; drill hole STDD002, collared 270m SW of
SUMDD001
At Skorusa East all drill holes intersected hydrothermally altered andesite volcanics interpreted to be part
of a larger footprint of a porphyry system. Trace disseminated chalcopyrite and quartz-chalcopyrite-pyrite
B-veins were encountered throughout the STRD005 drillhole suggesting existence of a different
mineralized center to the east. Quartz -magnetite stockwork-like veinlets and D -type porphyry sulphide
veins were also identified and remain untested.
Adding to the prospectivity of the Sumrakovac license, completed regional exploration and historical data
compilation has identified an additional trend of mineral occurrences and hydrothermal alteration located
~ 3 km east of the Skorusa system and ~7 km west of the Cukaru Peki discovery. This area has had very
little exploration in the past, shares the same geology and structural setting and offers further exploration
potential within the Sumrakovac license.
Overview of Osnic
Osnic license totals 76 sq.km and is located directly east of the Savinac license and south -east of
Sumrakovac license. The Osnic license covers an area of structural complexity - intersection of m ajor
structures recognised in Timok Belt and has potential for undercover epithermal and porphyry Cu -Au
mineralisations.
Completed exploration work at Osnic includes geological mapping, limited geochemical sampling (stream,
soil and rock), ground magnetic survey and scout drilling of three RC holes totalling 501 m and one
diamond drill hole totaling 251.2m.
Northern part of the license is highlighted by copper -in-soil anomaly from a regional 1km x 1 km grid
survey. Drill hole 18 -OSN-01 intersected disseminated native copper and chalcocite mineralisation in
clasts indicative for nearby mineralised source.
LEGAL*46281289.2
Overview of Dubrava
Dubrava totals 51 sq.km wrapping around the eastern side of the Bor Mine Complex and the Veliki Krivelj
open pit mining operation and 3.5km north from the Cukaru Peki deposit. Previous drilling identified
hydrothermal breccia in drill hole BJ04 from the southwestern corner of the licens e and intersected 28m
@ 0.24% Cu and 0.25 g/t Au from 22m . The brecciated zone correlates with resisti vity geophysical
anomaly that remains open to the west and is controlled by NNW striking fault zone. NNW regional
structures also control the Bor and Veliki Krivelj Cu-Au epithermal and porphyry orebodies.
Southern part of the license is mostly covered by Miocene and Cretaceous sediments with scarce outcrop
of prospective andesite which has demonstrated anomalous Cu -Mo-Au rock, soil and drill core
geochemical assay results as well as containing argillic hydrothermal alteration at surface. Structurally this
part of the project sits on the main Bor – Cukaru Peki mineralised trend. Lack of outcrop and the cover
predetermined reliance on geophysical exploration methods. The company has completed AMT, CSAMT,
IP and gravity surveys.
The 2016 drill program at Dubrava comprised of two drill holes which targeted under cover IP geophysical
anomalies assumed to be related to previously intersected mineralised breccia zone in drill hole BJ04. The
two drill holes could not explain the geophysical an omalies. Analysis of drill core suggests that the
intersected structures and late mineral quartz porphyry are dipping to west-south-west almost in parallel
to the direction of the drill holes.
Additionally, the Company has carried out structural analysis over the license which will be combined with
detailed interpretation of all results obtained to date in order to prioritize the next phase of exploration.
Overview of Padina
Padina is located 4 km east of the Bor Mine Complex and totals 12 sq.km with the potential to host
sediment hosted epithermal Au and Cu -Au porphyry style mineralization. Similar to the Dubrava license ,
Padina’s potential is considered undercover, therefore geophysical exploration was widely applied and
used for targeting combined with regional and detail structural analysis. Six conceptual targets were
delineated and prioritised using the current knowledge of geophysical models of porphyry and epithermal
deposits. One diamond drill hole was completed to 401m depth testing one of the conceptual targets. The
drill hole intersected wide fault zone containing disseminated sulphides - mainly pyrite with no significant
results.
Mundoro Generative Programs and Outlook for Projects Available for Option or Joint Venture
The Company has an ongoing target generation program where we evaluate both existing and new target
areas. Several target areas in Serbia are currently under review. The Company has made a number of
applications in 2019 for further exploration areas. Mundoro continues to have discussions with interested
third parties seeking options on our available projects, confirming the growing interest in exploring in
Timok, Serbia as well as in Bulgaria.
Sampling, Assaying, QA/QC, and Qualified Person
Mundoro’s samples were collected in accordance with industry best practice standards. The samples were
submitted to SGS managed laboratory in Bor, Serbia for sample preparation and analysis or to ALS Prep
LEGAL*46281289.2
Laboratory in Bor, Serbia, for sample preparation and then internally submitted to ALS Romania and ALS
Ireland for analysis. Samples are processed and assayed using 50 -gram fire assay with atomic absorption
(AAS) finish and multi -element method 4 acid digestion ICP -AES package. In addition to the laboratory’s
internal QA/QC procedures, the Company conducted its own QA/QC with the systematic inclusion of
certified reference materials every 20 samples, blank samples every 20 samples and field duplicates at
every 25 samples. All data collected in the field and assay results from the laborat ories are routinely
verified and entered into an Access database.
Technical information contained in this Press Release has been reviewed and approved by Mr. G.
Magaranov, P. Geo., Qualified Person as defined by National Instrument 43-101.
About Mundoro
Mundoro is a Canadian mineral exploration and development public company focused on building value
for its shareholders through directly investing in mineral projects that have the ability to generate future
returns for shareholders. The Company holds a diverse portfolio of projects in Serbia and Bulgaria as well
as an investment in a producing gold mine in Bulgaria. There are eight licenses in Serbia, one of is optioned
to JOGMEC, two licenses are optioned to Freeport -McMoRan Exploration Corporation, four licenses are
optioned to Vale and one license, Zeleznik available for third parties to option. In Bulgaria, Mundoro has
formed a Generative Alliance with JOGMEC. Mundoro’s common shares trade on the TSX Venture
Exchange under the symbol “MUN”.
For further information please contact:
Teo Dechev,
CEO, President and Director
Mundoro Capital Inc.
Phone: +1-604-669-8055
Caution Concerning Forward-Looking Statements
This News Release contains forward-looking information and statements (“forward-looking statements”)
under applicable securities laws. All statements, other than statements of historical fact, included or
incorporated by reference in this News Release are forward -looking statements, including, without
limitation, the completion of exploration work on any Projects and licenses and results of that exploration
work, the prospect of one or more joint ventures and other statements regarding activities, events or
developments that the Company expects or anticipates may occur in the future. These forward -looking
statements can be identified by the use of forward-looking words such as "will", "expect", "intend", "plan",
"estimate", "anticipate", "believe", “promising”, “encouraging” or "continue" or similar words or the
negative thereof. The material assumptions that were applied in making the forward -looking statements
in this News Release include expectations as to the Company's future strategy and business plan an d
execution of the Company's existing plans. There can be no assurance that the plans, intentions or
expectations upon which these forward -looking statements are based will occur. We caution readers of
this News Release not to place undue reliance on forwa rd looking statements contained in this News
Release, which are not a guarantee of performance and are subject to a number of uncertainties and other
factors that could cause actual results to differ materially from those expressed or implied by such
forward-looking statements. These factors include general economic and market conditions, changes in
law, regulatory processes, the status of Mundoro's assets and financial condition, actions of competitors
and the ability to implement business strategies and pursue business opportunities. The forward-looking
LEGAL*46281289.2
statements contained in this News Release are expressly qualified in their entirety by this cautionary
statement. The forward-looking statements included in this News Release are made as of the date of this
News Release and Mundoro undertakes no obligation to publicly update such forward-looking statements
to reflect new information, subsequent events or otherwise, except as required by law. Shareholders are
cautioned that all forward -looking statements invo lve risks and uncertainties and for a more detailed
discussion of such risks and other factors that could cause actual results to differ materially from those
expressed or implied by such forward -looking statements, refer to the Company's filings with the
Canadian securities regulators available on www.sedar.com.
Neither 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 release.
Figure 1: Location Map