Santacruz Silver Extends Zimapan Mine Lease Agreement with Grupo PeñolesTo December 2020
TSX.V: SCZ
FSE: 1SZ
October 29, 2019
Santacruz Silver Extends Zimapan Mine Lease Agreement with Grupo
PeñolesTo December 2020
Vancouver, B.C. -- Santacruz Silver Mining Ltd. (TSX.V:SCZ) (the "Company" or "Sant acruz") reports that
its 100% owned subsidiary company, Carrizal Mining, S.A. de C.V. ("Carrizal") has agreed with Minera
Cedros, S.A. de C.V. ("Minera Cedros"), a wholly -own subsidiary of Grupo Peño les, S.A.B. de C.V., to extend
the expiry date of the cur rent Zimapan Mine lease agreement (see press release dated July 2, 2019) from
December 31, 2019 to December 31, 2020.
Arturo Prestamo, Santacruz's CEO stated, "We are pleased that Minera Cedros has agreed to extend th e
current expiry date of the Zimapan M ine lease agreement as we expect there will be substantial benefit to the
Company from operating the Zimapan Mine during this period while a lso providing the parties additional time
to negotiate the terms of the potential acquisition of the Zimapan Mine by Carrizal."
Pursuant to the terms of the existing Zimapan Mine lease agreement, Carrizal must make monthly payments
to Minera Cedros based on 4% of the net smelter receipts from the concentrates produced by the Zimapan
Mine for each respective month, subj ect to the minimum payment each month being US$45,000 and the
maximum payment being US$60,000.
There is no assurance that Carrizal will be successful in completing the acquisition of the Zimapan Mine. Any
transaction to acquire the Zimapan Mine will be su bject to receipt of a ll necessary regu latory approvals,
including Santacruz obtaining the approval of the TSX Venture Exchange .
About Santacruz Silver Mining Ltd.
Santacruz is a Mexican focused silver company with two producing silver projects, Veta Gra nde and Rosario,
and two exploration properties, the Minillas property and Zacatecas properties. T he Company also owns 100%
of Carrizal Mining S.A. de C.V. Carrizal Mining is a private Mexican mining company that holds a 20%
working interest in the Compan y’s Veta Gr ande Project and has the right to operate the Zimapan Mine until
December 31, 2020 under a mining lease agreement.
The Company is managed by a technical team of professionals with proven track records in developing,
operating and discoveri ng s ilver mines in Mexico. Our corporate objective is to become a mid -tier silver
producer.
‘signed’
Arturo Préstamo Elizondo,
President, Chief Executive Officer and Director
For further information please contact:
Arturo Prestamo
Santacruz Silver Mining Ltd.
Email: [email protected]
Telephone: (604) 569-1609
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is def ined in the policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward looking information
Certain statements contained in this news release constitute "forward -looking information" as such term is
used in applicable Canadian securities laws, including statements relating to the potential acquisition of the
Zimapan Mine by the Company from the owner . Forward-looking information i s based on plans, expectations
and est imates of management at the date the information is provided and is subject to certain factors and
assumptions. In making the forward -looking statements included in this news release, the Company has
applied several material assumptions, including that th e Company's financial condition and development plans
do not change as a re sult of unforeseen events, and that future metal prices and the demand and market
outlook for metals will remain stable or improve. Forward -looking information is subject to a vari ety of risks
and uncertainties and other factors that could cause plans, es timates and actual results to vary materially from
those projected in such forward -looking information. Factors that could cause the forward -looking information
in this news releas e to change or to be inaccurate include, but are not limited to, the risk t hat any of the
assumptions referred to above prove not to be valid or reliable; there can be no assurance that the Company
will be successful i n acquiring outright the Zimapan Mine (including obtaining the necessary funding for the
purchase price thereof), and therefore there is a risk that the allocation to the Company of production from the
Zimapan Mine will discontinue after December 31, 20 20, which would result in a significant reduction to future
production results; delays and/or cessation in planned w ork; changes in the Company's financial condition and
development plans; risks associated with the interpretation of data (including in respect of the third party
mineralized material) regarding the geology, grade and continuity of mineral deposits; the uncertainty of th e
geology, grade and continuity of mine ral deposits and the risk of unexpected variations in mineral resources,
grade and/or recovery rates; market conditions and volatility and global economic conditions; risks related to
gold, silver, base metal and othe r commodity price fluctuations; risks relating to environmental regulation and
liability; the possibility that results will not be consistent with the Company's expectations, as well as the other
risks and uncertainties applicable to mineral exploration and development activities and to the Company as set
forth in the Company's continuous disclosure filings filed under the Company's profile at www.sedar.com.
There can be no assurance that any forward -looking information will prove to be accurate, as actual r esults
and future events could differ materially from those anticipated in such statements. Accordingly, the reader
should not place any undue reliance on forward -looking information or statements. The Company undertakes
no obligation to update forward-looking information or statements, other than as required by applicable law.
Rosario Project
The decisions to commence production at the Rosario Mine, Cinco Estrellas Property and Membrillo Prospect
were not based on a f easibility study of mineral reserves de monstrating economic and technical viability, but
rather on a more preliminary estimate of inferred mineral resources. Accordingly, there is increased
uncertainty and economic and technical risks of fai lure associated with this production decision. Product ion
and economic variables may vary considerably, due to the absence of a complete and detailed site analysis
according to and in accordance with NI 43-101.
Veta Grande Project
The decision to commence production at the Veta Grande Project was not based on a feasibility study on
mineral reserves demonstrating economic and technical viability. Accordingly, there is increased uncertainty
and economic and technical risks of failure associated with this prod uction decision. Production and economic
variables may vary considerably due to the absence of a complete and detailed site analysis according to and
in accordance with NI 43-101.
Zimapan Mine
Production at the Zimapan Mine is not supported by a feasibilit y study on mine ral reserves demonstrating
economic and technical viability or any other independent economic study under NI 43-101. Accordingly, there
is increased uncertainty and economic and technical risks of failure associated with production operations at
the Zimapa n Mine . Production and economic variabl es may vary considerably due to the absence of a
complete and detailed site analysis according to and in accordance with NI 43-101.