Patagonia Enters into Offer Letter with Latin Metals Regarding Proposed Option Agreement to Acquire Mina Angela
PATAGONIA ENTERS INTO OFFER LETTER WITH LATIN METALS REGARDING
PROPOSED OPTION AGREEMENT TO ACQUIRE MINA ANGELA
August 13, 2019 Vancouver, BC. Patagonia Gold Corp. (formerly Hunt Mining
Corp.) (“Patagonia” or the “Company”) (TSXV: PGDC) is pleased to announce that
the Company has accepted Latin Metals Inc.’s (forme rly Centenera Mining
Corporation) (“Latin Metals”) offer (the “Offer”) to enter into an option agreement
(the “Agreement”) regarding the acquisition by Pata gonia of the past-producing
Mina Angela property (“Mina Angela”) located in the Province of Chubut,
Argentina. Mina Angela is located approximately 50 km from the Company’s
Calcatreu gold project, which is located in the Rio Negro province, Argentina.
Highlights of the Offer and Proposed Option Agreement:
• Six-month exclusive due diligence period;
• The Agreement is expected to grant Patagonia the option to acquire Mina
Angela from Latin Metals for total consideration of US$1 million plus a 1%
Net Smelter Royalty (“NSR”) on any future production;
• Mina Angela had limited historical exploration and past production of
approximately 130,000 ounces of Au and approximately 1.6 million ounces
of Ag from only 2 veins;
• There is potential for discovery of additional prec ious metal mineralized
veins; and
• Mina Angela has similar age and general geologic ch aracteristics of the
Company’s 100% owned Calcatreu gold project.
Mina Angela lies within the northwest-oriented, reg ional-scale Gastre Fault
System, a highly prospective belt known to host other gold-silver deposits such as
Navidad and Calcatreu. In connection with the Offer, Patagonia has agreed to pay
Latin Metals US$40,000 during the due diligence per iod, which gives Patagonia
exclusive rights to enter into the Agreement. At t he end of the due diligence
period and upon signing of the Agreement, it is expected that Patagonia will pay
US$250,000 to Latin Metals and a further US$250,000 within six months of signing
the Agreement if Patagonia exercises the option. A further, and final payment of
US$500,000 is expected to be due, once rights-to-mi ne in the province are
established. In addition, Latin Metals is expected to be entitled to receive a 1%
NSR from future production. Patagonia expects to have the option to acquire half
of the NSR for a payment of US$1 million.
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The acquisition of the Mina Angela is also subject to customary closing conditions,
including the entry into of the Agreement and the a pproval of the TSX Venture
Exchange since it is a “reviewable transaction” for Latin Metals.
About the Mina Angela Property
The Mina Angela property is situated in the Somuncu ra Massif of southern
Argentina and is comprised of 44 individual claims. It covers 200 km² and is
located approximately 50 km east-southeast of Patag onia’s 100% owned
Calcatreu gold project. The Navidad silver and bas e metal deposit is located 45
km further to the south-southeast of Mina Angela. T here is currently a 1% NSR
from future production on the Mina Angela property.
The area is in a region of highly prospective, Jurassic-aged, bimodal volcaniclastic
rocks, which host NE-trending, gold- and silver-bea ring, intermediate sulfidation
epithermal veins. The veins are spatially associated with rhyolite domes and dykes
and the system broadens to the southwest.
Production took place at the Mina Angela property o n selected veins between
1978 and 1992. From 1983, when accurate mining records begin, until closure in
1992, Mina Angela produced 1,037,360 tons at an ave rage grade of 4.0g/t Au,
48.4g/t Ag, 2.0% Pb, 0.4% Cu and 4.6% Zn.
In 1997 and 1998 Lonrho Mining South Africa (“Lonrh o”) carried out exploration
including geological mapping, regional soil sampling and ground geophysics. The
program also included 3,443 metres of diamond drilling in 16 holes drilled within
a 4 by 5 kilometre area. The best values were obtained on the Sahuel vein system,
where one hole intersected 1.36 metres grading 40.65 g/t Au, 1773 g/t Ag, 1.79%
Pb, 0.23% Cu and 10.06% Zn at a vertical depth of 6 5 metres below surface.
Another hole drilled on the same system intersected a second vein approximately
65 metres to the west with 2.02 metres averaging 6. 69 g/t Au, 240g/t Ag, 0.52%
Pb, 0.04% Cu and 2.19% Zn. The other holes indicat e gold values ranging from
trace to 2.25 g/t over varying widths. The system i s presently poorly delineated
and remains open along strike and at depth. The Company believes that, through
further exploration activities, followed by drillin g, the property has a strong
potential for the discovery of new, precious metal mineralized structures.
The Company’s Qualified Person has not done sufficient work to validate historic
drill and production results and the Company does not consider them current or
necessarily indicative of future results. The poten tial quantity and grade of such
results is conceptual in nature, there has been insufficient exploration to define a
mineral resource and it is uncertain that further e xploration will result in such
targets being delineated as mineral resources.
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Qualified Person’s Statement
The scientific and technical information herein was reviewed and approved by Dr.
Walter Soechting, PGeo. Dr. Soechting has experience in the type of deposit under
consideration and in the type of activity conducted , and is a Qualified Person as
defined by NI 43-101. Dr. Soechting took reasonable steps to verify the scientific
and technical information in this news release; how ever, he did not have access
to the historical drill logs or samples.
About Patagonia Gold
Patagonia Gold Corp. is a mining and development com pany listed on the TSX
Venture Exchange. The Company seeks to grow shareho lder value through
exploration and development of gold and silver proj ects in the Patagonia region
of Argentina. The Company is primarily focused on the Calcatreu project in Rio
Negro and the development of the Cap-Oeste undergrou nd project. Patagonia,
indirectly through its subsidiaries or under option agreements, has mineral rights
to over 350 properties in several provinces of Argentina, Chile and Uruguay and is
one of the largest landholders in the province of Santa Cruz, Argentina.
For more information, please contact:
Christopher van Tienhoven, Chief Executive Officer
Patagonia Gold Corp
T: +54 11 5278 6950
FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements, including, but not limited
to, statements about the Agreement, approval of the TSX Venture Exchange and the
Company’s future plans and intentions. Wherever pos sible, words such as “may”, “will”,
“should”, “could”, “expect”, “plan”, “intend”, “ant icipate”, “believe”, “estimate”,
“predict” or “potential” or the negative or other variations of these words, or similar words
or phrases, have been used to identify these forwar d-looking statements. These
statements reflect management’s current beliefs and are based on information currently
available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many
factors could cause actual results, performance or achievements to differ materially from
the results discussed or implied in the forward-loo king statements. These factors should
be considered carefully and readers should not plac e undue reliance on the forward-
looking statements. Although the forward-looking st atements contained in this news
release are based upon what management believes to be reasonable assumptions, the
Company cannot assure readers that actual results will be consistent with these forward-
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looking statements. These forward- looking statemen ts are made as of the date of this
news release, and the Company assumes no obligation to update or revise them to reflect
new events or circumstances, except as required by law.
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 release.