Radius Gold and Fresnillo plc Sign Exclusivity Agreement for Plata Verde Project in Mexico
news release
12 July, 2022
Radius Gold and Fresnillo plc Sign Exclusivity Agreement for Plata Verde
Project in Mexico
Vancouver, British Columbia – Radius Gold Inc. (TS XV: RDU) (“Radius” or “the Company”) is pleased to
announce that its wholly owned subsidiary Geometales del Norte -Geonorte, S.A. de C.V. (“Geonorte”)
has entered into a n Exclusivity Agreement (the "Agreement") with Minera San Julian, S.A. de C.V.
("Minera San Julian"), a wholly owned subsidiary of Fresnillo plc (“Fresni llo”), for Radius’ 100% owned
Plata Verde Project in Chihuahua, Mexico. This Agreement grants Minera San Julian an exclusive right for
nine months to negotiate an option agreement to earn a 70% interest in the project (the “ Definitive
Agreement”). Minera San Julian will pay Geonorte US$ 100,000 within fourteen days of signing the
Agreement.
Fresnillo is the world’s leading silver producer and Mexico’s largest gold producer. Fresnillo holds one of
the largest precious metals reserves in Mexico.
Bruce Smith, President and CEO of Radius, stated, “Plata Verde has the potential to be a large-scale silver
discovery and our new partner Fresnillo, as the world largest primary silver producer, recognize s that
potential. Together, we have the technical resources and skills to explore and maximize the potential of
the Plata Verde project. Plata Verde is located between two of Fresnillo’s premier mining assets, the San
Julian Mine, with FY21 mine production of 55,847 gold oz and 16,772,000 silver oz, and the Orisyvo project
with indicated and inferred resources of 9.6 moz gold and 12.7 moz silver*. With Fresnillo’s scale and
successful exploration, development and operational experience in the region, Radius has a great partner
to advance Plata Verde.”
Highlights of the potential Definitive Agreement are summarized below:
• Minera San Julian would spend over a four year period a minimum cumulative amount of
US$ 5.0 million on exploration activities at the Plata Verde Project.
• Minera San Julian would make option payments to Geonorte totaling US$ 3.117 million,
which includes US$1.117 to cover underlying property agreements.
• Minera San Julian would have the right to earn a 70% interest in the Plata Verde Project.
• If the option is exercised, a new company (NewCo) would be set up to own the Plata Verde
Project, Newco would be owned 70% by Minera San Julian and 30% by Geonorte.
• Any additional funding required by NewCo would be provided by Minera San Julian and
Geonorte in proportion to their respective ownership interests in NewCo.
-2-
• Should either Party’s interest fall below 10% interest in NewCo that interest would
convert to a 2% NSR.
• The Parties will have the right of first refusal to acquire the other Party’s shares in NewCo
if the other Party r eceives a firm offer for the other Party’s interest in NewCo that the
other Party would propose to accept.
Figure 1: Location Map of Plata Verde and Surrounding Mines
About Plata Verde
The Plata Verde project is located in Chihuahua, Mexico, north of Radius’ Amalia Gold-Silver project and
east of the historic Batopilas silver mining district (1708 to 1920) which reputedly produced over 300
million ounces of silver from high grade veins and structures. A new road has been constructed to enable
access to the property.
Radius geologists have re -discovered an undocumented large scale underground bulk mining operation
where in the late 1800's, historic miners hand excavated an extensive series of anastomosing caverns,
producing silver bars at an associated smelter operation. The project appears to be un-explored since the
miners ceased their operations, and no references have been found within the Mexican Geological Survey.
The few local residents have no knowledge of exploration companies working in the area and there are
no indications of prior exploration within the mines or surrounding outcrops. Initial prospecting rock chips
by Radius geologists have returned silver grades up to 1070 g/t Ag.
-3-
At Plata Verde, silver mineralization occurs as massive to crustiform banded silica, barite and calcite with
silver chlorides, sulphosalt minerals and native silver infilling and cementing fractures and breccia within
a basaltic/andesite extrusive volcanic. The basaltic/andesite host occurs at the base of the Upper Rhyolitic
Volcanics of the Northern Sierra Madre. In general, the host volcanics and associated silver mineralization
are covered by the overlying rhyolitic ignimbrites and are only exposed along the length of a small creek.
On the eastern side of the creek several small entrances, hardly visible, lead to an extensive network of
anastomosing mining tunnels and cavities. The mining and excavation were done by hand with hammer,
chisel and black powder explosives, leaving behind large underground cavities up to 50m x 50m x 30m
high. Throughout the mines roman numerals painted on the walls record up to 58 mining areas. The
mining excavations define a strike extension of over 500m and up to 100m wide. The host volcanic unit is
at least 60m thick. The southern extension is cut by a fault which forms a large cliff face. To the north,
east and west the host volcanic flows and silver mineralization are covered by the ignimbrites and remain
open to unknown extent in these directions.
Radius's geological team have completed detailed underground mapping and sampling of the historic
Mina Real and Mina Mojonera. Three distinct mineralization styles have been defined within the basaltic
andesite volcanic host rock:
1. Multiple large scale volcanic breccia zones up to 75 m diameter and sampled on multiple mine
levels. The breccias are cemented by massive to crustiform banded barite calcite with silver
chlorides, sulphosalt minerals and native silver.
2. Fracture fill and st ockwork silver mineralization occurs as massive to crustiform banded barite
calcite with silver chlorides, sulphosalt minerals and native silver.
3. Disseminated style mineralization with fine silver sulphosats disseminated within the volcanic
host with little to no brecciation, veining or fracture fill.
Detailed underground 2x2 m panel samples were collected from the historic Mina Real and Mina
Mojonera. Each mine covers a shallow dipping anastomosing sequence of mining areas on at least 3 levels
with Mina Real covering approximately 200x200 m and Mina Mojonera 150x150 m. 255 rock chip samples
reported between 2 and 815 g/t Ag, averaging 156 g/t Ag in all rock types and mineralization styles or 258
g/t Ag within breccia units.
The barite/silver chloride mineralization appears to be a late -stage low temperature mineralizing event
with the source and feeder systems an attractive exploration target. Barite and silver chloride are often
part of the upper levels or supergene zone around large silver d eposits, notably within parts of the
Fresnillo district. The solubility of barite and silver chlorides is low, and hence the source zone is likely to
be close by. Extensions of the known manto style mineralization below the ignimbrite cover to the north,
east and west are open.
-4-
Figure 2: Entrance to historic Mojonera Mine, Plata Verde Project.
Technical Information
Bruce Smith, M.Sc. (Geology), a member of the Australian Institute of Geoscientists, is Radius’ Qualified
Person as defined by National Instrument 43 -101 - Standards of Disclosure for Mineral Projects. Mr.
Smith has 28 years of mineral exploration experie nce and has prepared and approved the technical
information contained in this news release.
*Information on Fresnillo mining assets obtained from Fresnillo 2021 Annual Report
Quality Assurance and Quality Control
Reported assays are rock chip and channel s samples taken by Radius geologists and trained sampling
teams. Sample intervals are generally 2m chip channels or 2x2m panels producing samples of between 2
to 9 kg. Reported samples were delivered to SGN Labor atories in Paral, Chihuahua. The samples were
crushed and pulverized. Two 100 gram splits were taken. Radius geologists removed and stored the excess
and a 100g split at the Radius offices. SGN performed initial Ag and Au analysis. The second split was
subsequently sent to the ALS Geochem istry laboratory facilities in Chihuahua, Mexico and was analy zed
for Ag and multi -elements using method code ME -ICP61 following a four -acid digestion. Overlimits are
analyzed using an appropriate method. All assays reported above 30g/t Ag have been analy zed by ALS
Geochemistry. Radius routinely inserts multi-element geochemical standards and blanks into the sample
-5-
stream to monitor laboratories performance. Quality control samples submitted were returned within
acceptable limits. Comparisons between sample splits demonstrate acceptable accuracy and precision
Radius Gold Inc.
Radius has a portfolio of projects located in Mexico, United States and Guatemala which it continues to
advance, utilizing partnerships where appropriate in order to retain the Company ’s strong treasury. At
the same time, management is seeking out additional investment and project acquisition opportunities
across the globe.
ON BEHALF OF THE BOARD
Bruce Smith
President and CEO
Symbol: TSXV-RDU
Contact: Bruce Smith
200 Burrard Street, Suite 650
Vancouver, BC V6C 3L6
Tel: 604-801-5432; Toll free 1-888-627-9378; Fax: 604-662-8829
Email: [email protected]
Website: www.radiusgold.com
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts
responsibility for the adequacy or accuracy of this release.
Forward-looking statements
Certain statements contained in this news release constitute forward -looking statements within the meaning of
Canadian securities legislation. All statements included herein, other than statements of historical fact, are forward-
looking statements and include, without limitation, statements about the results of exploration work and future
plans at the Plata Verde Project. Often, but not always, these forward looking statements can be identified by the
use of words such as “estimate”, “estimates”, “estimated”, “potential”, “open”, “future”, “assumed”, “projected”,
“used”, “detailed”, “has been”, “gain”, “upgraded”, “offset”, “limited”, “contained” , “reflecting”, “containing”,
“remaining”, “to be”, “periodically”, or statements that events, “could” or “should” occur or be achieved and similar
expressions, including negative variations.
Forward-looking statements involve known and unknown risks, unc ertainties and other factors which may cause
the actual results, performance or achievements of the Company to be materially different from any results,
performance or achievements expressed or implied by forward -looking statements. Such uncertainties and factors
include, among others, whether the planned exploration work at Plata Verde will proceed as intended; changes in
general economic conditions and financial markets; the Company or any joint venture partner not having the
financial ability to meet its exploration and development goals; risks associated with the results of exploration and
development activities, estimation of mineral resources and the geology, grade and continuity of mineral deposits;
unanticipated costs and expenses; and such other risks detailed from time to time in the Company’s quarterly and
annual filings with securities regulators and available under the Company’s profile on SEDAR at www.sedar.com.
Although the Company has attempted to identify important factors that could cause actual actions, events or results
to differ materially from those described in forward -looking statements, there may be other factors that cause
actions, events or results to differ from those anticipated, estimated or intended.
-6-
Forward-looking statements contained herein are based on the assumptions, beliefs, expectations and opinions of
management, including but not limited to: that the exploration work at the Plata Verde Project will advance as
planned; that the Company’s stated goals and the planned exploration and development activities at its properties will
be achieved; that there will be no material adverse change affecting the Company or its properties; and such other
assumptions as set out herein. Forward -looking statements are made as of the date hereof and the Company
disclaims any obligation to update any forward-looking statements, whether as a result of new information, future
events or results or otherwise, except as required by law. There can be no assurance that forward -looking
statements will prove to be accurate, as actual results and future events could differ materially from those anticipated
in such statements. Accordingly, investors should not place undue reliance on forward -looking statements.