PML.V · 2021-10-12 12:00:00

Panoro Minerals Announces the Sale of Antilla Copper Project for Cash and Royalty

Mergers & Acquisitions Royalties & Streams

Panoro Minerals Announces the Sale of Antilla

Copper Project for Cash and Royalty

VANCOUVER, BC

Oct. 12, 2021

/CNW/ -

Panoro Minerals Ltd

. (TSXV: PML) (Lima: PML)

(Frankfurt: PZM) (OTCQB: POROF) ("Panoro" or the "Company") is pleased to announce the sale

of its Antilla Project to Heeney Capital Acquisition Company Inc. ("HCAC"), a mineral exploration and

development company. Panoro has agreed to sell 90% of the shares of

Antilla Copper S.A.

("Antilla"), a wholly owned subsidiary of Panoro, which holds the Antilla Project, in consideration for

advanced payments of up to 13% of the Net Present Value of the Antilla Project plus a Net Smelter

Return royalty ("NSR") of 1% (on top of the 2% NSR that the Company already owns on the Antilla

Property). The advanced payments will be staged and HCAC will initially earn a 75% interest in

Antilla on closing plus an additional 15% 12 months after the earlier of drilling permits being obtained

or a pre-feasibility or feasibility study being completed on the Antilla Project (a "Study"), for a total

90% interest. The Company and HCAC will contribute their pro-rata portion of all exploration and

development expenditures.

Pending the results of the Study, the total of the advanced payments could be between

C$ 20 million

and

C$ 70 million

, plus the aggregate up to the 3% NSR over the life of the mine.

Advance payments

to Panoro will include both scheduled and contingent payments for HCAC to

earn in a 90% interest in stages as outlined below:

Scheduled Payments of:

C$ 10 million

on closing of the transaction,

C$ 2.8 million

10 months from closing,

C$ 7 million

12 months after the earlier of drilling permits being obtained or a Study being

completed.

Contingent Payments of:

C$ 10 million

if the Study estimates the Net Present Value at an 8% discount rate (NPV

)

of the Antilla Project to be above

US$ 310 million

; or

Up to

C$ 50 million

if the Study estimates the NPV

to be above

US$ 360 million

Including the contingent payments, which will be received within 12 months of the completion of the

Study, the total advance payments could equal up to

C$ 70 million

(or approximately 13% of NPV

Net Smelter Return royalty

payments

to Panoro over the life of the Antilla Project will include:

an existing 2% NSR; plus

if Panoro's ownership in Antilla is diluted to below 5%, it's ownership interest will automatically

convert to an additional 1% NSR

Total 3% NSR, subject to a buyback right for the 1% NSR for

C$ 4 million

The range of potential payments from this transaction are summarized in the table below.

Antilla Project NPV

(million US$)

Total Advance Payments

(Scheduled and Contingent)

(million C$)

NSR

(%)

up to 310

20 to 24

2% to 3%

310 to 360

30 to 34

2% to 3%

above 360

up to 74

2% to 3%

1. To be estimated in the Study at a 8% discount rate at long-term street consensus pricing

The Antilla Project's preliminary economic assessment ("PEA") was completed in 2018 estimating an

after tax NPV of

C$ 516.1 million

(

US$ 397 million

) at a long-term copper price of

US$ 3.25

/lb and a

7.5% discount rate. For comparative purposes, at copper prices of between

US$ 3.25

/lb and

US$

4.00

/lb, a discount rate of 8% and factoring in an aggregate 3% NSR, the estimated payments from

the sale of the Antilla are shown in the table below.

Long-term Cu Prices

(US$/lb)

Total Advance Payments

1,2

(million C$)

NSR

(%)

3.25

56 to 60

2% to 3%

3.50

70 to 74

2% to 3%

4.00

70 to 74

2% to 3%

Based on NPV (US$ 335 million @ US$ 3.25/lb, US$ 426 million @ US$ 3.50/lb, US$ 640 million @ US$ 4.00/lb)

1.30 C$/US$, Factoring for the aggregate 3% NSR

Luquman Shaheen, President & CEO of Panoro Minerals states,

"The Company is very pleased

with the completion of this transaction. Panoro will reinvest the proceeds into the Company's

projects in

Peru

including its flagship Cotabambas Project. The focus at the Cotabambas Project

will be to advance with the work required to support a feasibility study and environmental impact

assessment. Our first priority will be to drill test attractive satellite targets before moving to infill

drilling programs. In parallel, metallurgical testing will look to optimize flotation recoveries and

estimate leach recoveries of the oxide resource. The resource growth potential at the Cotabambas

Project is encouraging, recovery improvements from the transition zone look promising, and the

addition of a heap leach component will add value, which, together with the high copper, gold and

silver commodity prices, present compelling upside to the value of the Cotabambas Project.

Importantly, Panoro will advance the Cotabambas Project while minimizing share dilution and

thereby maximizing our shareholders' exposure to the valuation upside. Furthermore, the

Company's growing royalty package presents additional upside to Panoro shareholders. The

royalty package now includes up to a 3% NSR on the Antilla Project, a 2% NSR on the Kusiorcco

Project and a 5% NSR on the Cochasayhuas Project."

Antilla Project

The Antilla Project PEA estimated production of between 54 and 66 million pounds per year of

payable copper during its first five years of operation and an average of over 46 million pounds per

year over the project's 17 year mine life.

The economic metrics estimated in the PEA are summarized in the Table below

Before Tax

After Tax

Copper

Price

(US$/lb)

NPV

(million

US$)

NPV

7.5%

(million

US$)

NPV

10%

(million

US$)

IRR

(%)

Payback

(Years)

NPV

(million

US$)

NPV

7.5%

(million

US$)

NPV

10%

(million

US$)

IRR

(%)

Payback

(Years)

2.75

487

383

301

28.8

2.9

232

169

118

18.7

3.6

3.05

648

520

419

34.7

2.6

394

305

236

25.9

3.0

3.25

755

611

497

38.4

2.5

501

397

314

30.3

2.7

1. Excluding Peru statutory charges ( i.e. profit sharing, regulatory fees, mining royalty, special mining tax, and income tax)

2. The economic results are based on the heap leach tonnages in the selected ultimate pit. The heap leach tonnages include

Inferred Resources. The reader is cautioned that inferred resources are considered too speculative geologically to have the

economic considerations applied to them that would enable categorization as Mineral Reserves. Mineral resources that are not

Mineral Reserves do not have demonstrated economic viability.

The PEA includes an open pit mining rate of 20,000 tonnes per day with the crushed ore being

delivered to a valley fill heap leach pad. The proposed processing includes a solvent extraction and

electrowinning (SX/EW) plant. The recovery of copper from the SX/EW plant was estimated to be

72.5% in the PEA. Subsequent to the PEA, column leaching tests completed have estimated

potential recoveries as high as 79.9%.

The Antilla Project includes a resource composed of indicated and inferred resources as follows:

Indicated Resources

of 291.8 million tonnes at 0.34% Cu and 0.01% Mo; and

Inferred Resources

of 90.5 million tonnes at 0.26% Cu and 0.008% Mo.

Resource growth potential identified at the Antilla Project includes:

North Block:

appears to be an extension of the resource zone of between 0.5 to 1.5 km, where

outcroppings of the same mineralization and the same sandstone package

included in the resource estimates has been mapped and sampled. In the North

Block the copper oxides and secondary sulfides outcrop along 2 km in the east-

west direction.

West Block:

located 1 to 3 km to the west of the project resources where 7 drillholes have

been executed in the past intersecting near surface copper mineralization. The

drillholes were completed before an extensive geochemistry survey by Panoro

which identified other drill target areas.

Intermediate Block:

the copper anomalies are aligned by structural control along 2.2 km length in

north-south direction. The target indicates a porphyry stock at surface located

from 200 m to 1 km to the west and southwest of the mineral resources area.

Chabuca Block:

the copper anomalies cover an area of 1.5 by 1.5 km at surface and are located

from 300 m to 2,000 m to the East of the resources. In Chabuca, a porphyry

stock intrudes the same sandstones package hosting the mineralization in the

resources area and in the North Block.

About Panoro

Panoro is a uniquely positioned

Peru

-focused copper exploration and development company. The

Company is advancing its flagship project, the Cotabambas Copper-Gold-Silver Project, and its

Antilla Copper-Molybdenum Projects located in the strategically important area of southern

Peru

Panoro has completed strategic partnerships at three of its projects:

Wheaton Precious Metals - Precious Metals Purchase Agreement, Cotabambas Project;

Hudbay Minerals – NSR Royalty and Cash sale, Kusiorcco Project; and

Mintania – NSR Royalty and Cash sale, Cochasayhuas Project.

At the Cotabambas Project, the Company is focused on delineating growth potential while optimizing

project economics. Exploration and step-out drilling from 2017, 2018 and 2019 have identified the

potential for both oxide and sulphide resource growth.

Summary of Cotabambas and Antilla Project Resources

Project

Resource

Classification

Million

Tonnes

Cu (%)

Au (g/t)

Ag (g/t)

Mo (%)

CuEq

Cotabambas

Cu/Au/Ag

Indicated

117.1

0.42

0.23

2.74

0.001

0.59

Inferred

605.3

0.31

0.17

2.33

0.002

0.44

@ 0.20% CuEq cutoff, effective October 2013, Tetratech

Antilla

Cu/Mo

Indicated

291.8

0.34

0.01

0.38

Inferred

90.5

0.26

0.007

0.29

@ 0.175% CuEq cutoff, effective May 2016, Tetratech

Cotabambas Project, Apurimac, Peru, NI 43-101 Technical Report on Updated Preliminary Economic Assessment, amec

foster wheeler and Moose Mountain Technical Services, 22 September 2015

Technical Report on the PEA for the Antilla Copper Project Heap Leach SX/EW Operation, Moose Mountain Technical

Services, 11 June 2018.

PEAs have been completed for both the Cotabambas and Antilla Projects, the key results are

summarized below.

Summary of Cotabambas and Antilla Project PEA Results

Key Project Parameters

Cotabambas

Cu/Au/Ag Project

Antilla Cu

Project

Process Feed, life of mine

million tonnes

483.1

118.7

Process Feed, daily

Tonnes

80,000

20,000

Strip Ratio, life of mine

1.25 : 1

1.38 : 1

Before

Tax

NPV

7.5%

million US$

1,053

520

IRR

20.4

34.7

Payback

years

3.2

2.6

After

Tax

NPV

7.5%

million US$

684

305

IRR

16.7

25.9

Payback

years

3.6

3.0

Annual

Average

Payable

Metals

thousand tonnes

70.5

21.0

thousand ounces

95.1

thousand ounces

1,018.4

thousand tonnes

Initial Capital Cost

million US$

1,530

250

Project economics estimated at commodity prices of; Cu = US$ 3.00/lb, Au = US$ 1,250/oz, Ag = US$ 18.50/oz, Mo = US$ 12/lb

Project economics estimated at long term commodity price of Cu = US$ 3.05/lb and short term commodity price of Cu = US$

3.20, US$ 3.15 and US$ 3.10 for Years 1, 2 and 3 of operations, respectively.

The PEAs are considered preliminary in nature and include Inferred Mineral Resources that are

considered too speculative to have the economic considerations applied that would enable

classification as Mineral Reserves. There is no certainty that the conclusions within the PEAs will be

realized. Mineral Resources are not Mineral Reserves and do not have demonstrated economic

viability.

Luis Vela

, a Qualified Person under National Instrument 43-101, has reviewed and approved the

scientific and technical information in this press release.

On behalf of the Board of

Panoro Minerals Ltd.

Luquman Shaheen. M.B.A., P.Eng, P.E.

President & CEO

CAUTION REGARDING FORWARD LOOKING STATEMENTS

: Information and statements

contained in this news release that are not historical facts are "forward-looking information" within

the meaning of applicable Canadian securities legislation and involve risks and uncertainties.

Examples of forward-looking information and statements contained in this news release include

information and statements with respect to:

closing of the sale of Antilla shares to HCAC;

scheduled and contingent payments by HCAC;

drilling permits for the Antilla Project being obtained;

completion of a Study on the Antilla Project and the NPV estimated in such Study;

potential dilution of Panoro's equity in Antilla below 5%;

advancing the Antilla Project to production;

Panoro weathering the current depressed equity and commodity markets, minimizing dilution to

existing shareholders and making targeted investments into exploration at the Cotabambas

Project;

mineral resource estimates and assumptions;

the PEAs, including, but not limited to, base case parameters and assumptions, forecasts of net

present value, internal rate of return and payback; and

copper concentrate grade from the Cotabambas Project.

Various assumptions or factors are typically applied in drawing conclusions or making the forecasts

or projections set out in forward-looking information. In some instances, material assumptions and

factors are presented or discussed in this news release in connection with the statements or

disclosure containing the forward-looking information and statements. You are cautioned that the

following list of material factors and assumptions is not exhaustive. The factors and assumptions

include, but are not limited to, assumptions concerning: metal prices and by-product credits; cut-off

grades; short and long term power prices; processing recovery rates; mine plans and production

scheduling; process and infrastructure design and implementation; accuracy of the estimation of

operating and capital costs; applicable tax and royalty rates; open-pit design; accuracy of mineral

reserve and resource estimates and reserve and resource modeling; reliability of sampling and

assay data; representativeness of mineralization; accuracy of metallurgical test work; and

amenability of upgrading and blending mineralization.

Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and

other factors which could cause actual events or results to differ materially from those expressed or

implied by the forward-looking statements, including, without limitation:

risks relating to metal price fluctuations;

risks relating to estimates of mineral resources, production, capital and operating costs,

decommissioning or reclamation expenses, proving to be inaccurate;

the inherent operational risks associated with mining and mineral exploration, development, mine

construction and operating activities, many of which are beyond Panoro's control;

risks relating to Panoro's or its partners' ability to enforce legal rights under permits or licenses

or risk that Panoro or its partners will become subject to litigation or arbitration that has an

adverse outcome;

risks relating to Panoro's or its partners' projects being in

Peru

, including political, economic and

regulatory instability;

risks relating to the uncertainty of applications to obtain, extend or renew licenses and permits;

risks relating to potential challenges to Panoro's or its partners' right to explore or develop

projects;

risks relating to mineral resource estimates being based on interpretations and assumptions

which may result in less mineral production under actual circumstances;

risks relating to Panoro's or its partners' operations being subject to environmental and

remediation requirements, which may increase the cost of doing business and restrict

operations;

risks relating to being adversely affected by environmental, safety and regulatory risks, including

increased regulatory burdens or delays and changes of law;

risks relating to inadequate insurance or inability to obtain insurance;

risks relating to the fact that Panoro's and its partners' properties are not yet in commercial

production;

risks relating to fluctuations in foreign currency exchange rates, interest rates and tax rates;

risks relating to Panoro's ability to raise funding to continue its exploration, development and

mining activities; and

counterparty risk under Panoro's agreements.

This list is not exhaustive of the factors that may affect the forward-looking information and

statements contained in this news release. Should one or more of these risks and uncertainties

materialize, or should underlying assumptions prove incorrect, actual results may vary materially

from those described in the forward–looking information. The forward–looking information contained

in this news release is based on beliefs, expectations and opinions as of the date of this news

release. For the reasons set forth above, readers are cautioned not to place undue reliance on

forward-looking information. Panoro does not undertake to update any forward-looking information

and statements included herein, except in accordance with applicable securities laws.

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 r

elease.

SOURCE

Panoro Minerals Ltd.

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For further information:

Panoro Minerals Ltd., Luquman Shaheen, President & CEO, Phone:

604.684.4246, Fax: 604.684.4200, Email: [email protected], Web: www.panoro.com; Renmark

Financial Communications Inc., Scott Logan, Account Manager, Phone: 416.644.2020 /

212.812.7680, Email:

[email protected], Web: www.renmarkfinancial.com

CO: Panoro Minerals Ltd.

CNW 15:12e 12-OCT-21

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