Silver BULL Enters into an Option Agreement to Acquire the Beskauga Copper-GOLD Project IN Kazakhstan
August 17, 2020 OTCQB: SVBL, TSX: SVB
SILVER BULL ENTERS INTO AN OPTION AGREEMENT TO ACQUIRE THE
BESKAUGA COPPER-GOLD PROJECT IN KAZAKHSTAN
Vancouver, British Columbia – Silver Bull Resources, Inc. (OTCQB: SVBL, TSX: SVB) (“Silver Bull”) is pleased
to announce it has entered into an option to purchase agreement with Copperbelt AG (“Copperbelt”), a
private mineral exploration company registered in Zug, Switzerland, to acquire a 100% interest in their
Beskauga copper-gold project located in North Eastern Kazakhstan.
Highlights of the Agreement
On execution of the agreement Silver Bull paid Copperbelt US$30,000. An additional US$40,000
will be paid to Copperbelt after due diligence on the Beskauga pro perty is completed to Silver
Bull’s satisfaction. Silver Bull will have a 60 day due diligence period which will commence after
the Company has been able to access the Beskauga property in a matter that complies with
governmental recommendations and adviso ries with respect to the global COVID -19 pandemic,
among other conditions.
Silver Bull will then have 4 years to conduct exploration on the property. Exploration expenditures
on Beskauga and certain other licenses required to keep the option in good standing are US$2
million in year one, US$3 million in year two, US$5 million in year three and US$5 million in year
four, for a total exploration spend of US$15 million over four years.
After completing US$15 million in cumulative exploration expenditures Silver Bull can acquire the
Beskauga property for a US$15 million cash payment.
In addition Copperbelt may receive a bonus payment of up to US$ 32 million should Silver Bull
publish a Bankable Feasibility Study (“BFS”) with a resource of up to 10 million gold equivalent
ounces on the main Beskauga prospect and 5 million gold equivalent ounces on an additional
prospect. 20% of the bonus is paya ble 60 days after publishing a BFS, with the remaining 80%
payable on the commencement of mine construction. Up to 50% of the bonus is payable in
common shares of Silver Bull at Silver Bull’s election.
Silver Bull will pay a finders fee to a third party upon the satisfaction of certain conditions.
Tim Barry, President, CEO and director of Silver Bull states, “We are extremely pleased to enter into this
agreement with Copperbelt. We believe the Beskauga copper -gold Project represents one of the best
exploration opportunities in the world. The high quality work that has been completed on the project to
date indicates Beskauga is a huge mineralizing system that has considerable upside that has yet to be
explored. We will be working closely with our partners from Copperbelt to quickly and efficiently explore
these areas. In addition to the exploration potential at Beskauga, the project has excellent infrastructure.
Paved road access and, 1100 KVA power lines, heavy rail, and a highly trained workforce all lie within a 10
kilometer radius. As a mining jurisdiction Kazakhstan is fast becoming a “go to ” place due to its recently
updated mining law and incredible geological prospectivity. In June 2018 the Kazakhstan government
implemented a new mining code based on the mini ng code used in Western Australia. Unlike many
Governments around the world today, the Kazakh Government is very supportive of the mining sector, a
view which is highlighted by the fact that numerous major mining companies have recently set up an
office in the country and acquired exploration licenses . We expect to provide more details about the
Beskauga project itself as soon as we complete our due diligence on the project.”
About Kazakhstan
Size: Kazakhstan is the ninth largest country in the world, covering 2,717,300 km2, and has a population
of 18.2 million people.
Capital City: The capital city is Nur -Sultan which is located 300 kilometers from the project . Nur-Sultan
has a major international airport allowing for easy access and administration of the Beskauga Project.
Mining Law: Kazakhstan adopted a new mining code titled “Code on Surface and Subsoil Use” (the "SSU
Code") on 27 December 2017, and became effective on 29 June 2018. The SSU Code is based o n the
Western Australian model where Kazakhstan moved from a contractual regime to a licensing regime for
solid minerals (except for ura nium). Coincident with the updated SSU law, the Kazakhstan government
also reduced a considerable amount of the administrative burdens for subsoil users.
Tax: Summary of pertinent taxes related to exploration in Kazakhstan are as follows;
20% corporate tax
12% VAT is refundable for exploration companies
4.7% royalty for Copper
5% royalty for gold and silver
Geological Prospectivity: Kazakhstan is one of the most prospective countries in the world for a number
of metals. According the United States Geological Survey (USGS) Kazakhstan is;
1st in the world for Uranium production (41% of world output)
2nd in the world for chromite production (18% of world output)
4th in the world for titanium production (6% of world output)
10th in the world for copper production
In addition, Kazakhstan has also has significant proven reserves (as yet unmined) of gold, silver, lead, zinc
tin, iron ore, nickel, cobalt, and bauxite
The Fraser Institute Annual Survey of Mining Companies in 2017, ranked Kazakhstan 24th best mining
jurisdiction in the world.
Sierra Mojada Update
Silver Bull’s Sierra Mojada project remains under an illegal blockade organized by a Cooper ative of local
Miners called Sociedad Cooperativa de Exploración Minera Mineros Norteños, S.C.L. (“Mineros
Norteños”).
Silver Bull has an agreement with Mineros Norteños on two small mineral licences which cover the eastern
part of the Sierra Mojada deposit. These licences are subject to a 2% production royalty to Mineros
Norteños capped at US$6.875 million (the “Royalty”) should a mine go into production.
Since 2014, Silver Bull has been fighting a law suit by Mineros Norteños seeking payment of the Royalty,
including interest at a rate of 6% per annum since August 30, 2004, even though no revenue has been
produced from the applicable mining concessions. Mineros Norteños also sought payment of wages to
the Mineros Norteños members since August 30, 2004 under this agreement, even though none of the
individuals were hired or performed work for Silver Bull unde r this agreement and Silver Bull did not
commit to hiring them. On October 4, 2017, the court ruled that Mineros Norteños was time barred from
bringing the case. On October 19, 2017, Mineros Norteños appealed this ruling. On July 31, 2019, the
Federal Appe al Court held the original ruling. This ruling was subsequently challenged by Mineros
Norteños and in March 2020 the Federal Appeals Court held the original ruling. Mineros Norteños may
challenge the ruling for a final time at the Federal Circuit Court. Due to COVID-19 the Mexican court system
remains closed and the timing of reopening is uncertain. In an attempt to force Silver Bull into making a
settlement, Mineros Norteños has undertaken to illegally block access to the project since September
2019. To ensure the safety of all involved, Silver Bull has elected to halt all operations on the project until
a resolution can be found.
Silver Bull remains committed to good faith dialogue with Mineros Norteños, many of whom have worked
for Silver Bull, to find a solution that is acceptable to both parties.
The joint venture option with South32 remains in good standing but under a force majeure pause.
South32 Joint Venture Option
In June 2018 Silver Bull sign ed an agreement with a wholly owned subsidiary of South32 whereby Silver
Bull has granted South32 an option to form a 70/30 joint venture with respect to the Sierra Mojada
Project. To maintain the option in good standing, South32 must contribute minimum exploration funding
of US$10 million ("Initial Funding") during a 4 year option period with minimum aggregate exploration
funding of US$3 million, US$6 million and US$8 million to be made by the end of years 1, 2 and 3 of the
option period respectively. South32 may exercise its option to subscribe for 70% of the shares of Minera
Metalin S.A. De C.V. ("Metalin"), the wholly owned subsidiary of Silver Bull which holds the claims in
respect of the Sierra Mojada Project, by contributing US$100 million to Metalin for Project funding, less
the amount of the Initial Funding contributed by South32 during the option period. During the period of
force majeure the year 2 completion date has been extended by the period of force majeure.
About Silver Bull : Silver Bull is a mineral exploration company whose shares are listed on the Toronto
Stock Exchange and trade on the OTCQB in the United States, and is base d out of Vancouver, Canada .
Silver Bull owns the Sierra Mojada Project which is located 150 kilometers north of the city of Torreon in
Coahuila, Mexico, and is highly prospective for silver and zinc.
About the Sierra Mojada deposit: Sierra Mojada is an open pittable oxide deposit with a NI43 -101
compliant measured and indicated "global" resource of 70.4 million tonnes grading 3.4% zinc and 38.6g/t
silver at a $13.50 NSR cutoff giving 5.35 billion pounds of zinc and 87.4 million ounces of silver. Included
within the "global" resource is a measured and indicated "high grade zinc zone" of 13.5 million tonnes
with an average grade of 11 .2% zinc at a 6% cutoff, giving 3.336 billion pounds of zinc, and a measured
and indicated "high grade silver zone" of 15.2 million tonnes with an average grade of 114.9g/t silver at a
50g/t cutoff giving 56.3 million ounces of silver. Mineralization remains open in the east, west, and
northerly directions. Approximately 60% of the current 3.2 kilometer mineralized body is at or near
surface before dipping at around 6 degrees to the east.
The technical information of this news release has been reviewed and approved by Tim Barry, a Chartered
Professional Geologist (CPAusIMM), and a qualified person for the purposes of National Instrument 43 -
101.
On behalf of the Board of Directors
"Tim Barry"
Tim Barry, CPAusIMM
Chief Executive Officer, President and Director
INVESTOR RELATIONS:
+1 604 687 5800
Cautionary Note to U.S. Investors concerning estimates of Measured, Indicated, and Inferred Resources: This press
release uses the terms "measured resources", "indicated resources", and "inferred resources" which are defined in,
and required to be disclosed by, NI 43-101. We advise U.S. investors that these terms are not recognized by the United
States Securities and Exchange Commission (the "SEC"). The estimation of measured, indicated and inferred resources
involves greater uncertainty as to their existence and economic feasibility than the estimation of proven and probable
reserves. U.S. investors are cautioned not to assume that measured and indicated mineral resources will be converted
into reserves. The estimation of inferred resources involves far greater uncertainty as to their existence and economic
viability than the estimation of other categories of resources. U.S. investors are ca utioned not to assume that
estimates of inferred mineral resources exist, are economically minable, or will be upgraded into measured or
indicated mineral resources. Under Canadian securities laws, estimates of inferred mineral resources may not form
the b asis of feasibility or other economic studies.
Disclosure of "contained ounces" in a resource is permitted disclosure under Canadian regulations, however the SEC
normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in place
tonnage and grade without reference to unit measures. Accordingly, the information contained in this press release
may not be comparable to similar information made public by U.S. companies that are not subject NI 43 -101.
Cautionary note regarding forward looking statements: This news release contains forward -looking statements
regarding future events and Silver Bull's future results that are subject to the safe harbors created under the U.S.
Private Securities Litigation Reform Act of 1995, the Securities Act of 1933, as amended (the "Securities Act"), and
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and applicable Canadian securities laws.
Forward-looking statements include, among others, statements rega rding that Beskauga is a huge mineralizing
system that has considerable upside that has yet to be explored, ability to work closely with our partners from
Copperbelt to quickly a nd efficiently explore the Beskauga area, support of the Kazakh Government of the mining
sector, geological prospectivity of Kazakhstan , ability to complete due diligence, mineral resource estimates and
ability to find a solution to the blockade that is acceptable to both parties . These statements are based on current
expectations, estimates, forecasts, and projections about Silver Bull's exploration projects, the industry in which Silver
Bull operates and the beliefs and assumptions of Silver Bull's management. Words such as "expects," "anticipates,"
"targets," "goals," "projects," "intends," "plans," "believes," "seeks ," "estimates," "continues," "may," variations of
such words, and similar expressions and references to future periods, are intended to identify such forward -looking
statements. Forward-looking statements are subject to a number of assumptions, risks and u ncertainties, many of
which are beyond our control, including such factors as the results of exploration activities and whether the results
continue to support continued exploration activities, unexpected variations in ore grade, types and metallurgy,
volatility and level of commodity prices, the availability of sufficient future financing, and other matters discussed
under the caption "Risk Factors" in our Annual Report on Form 10 -K for the fiscal year ended October 31, 2019 and
our Quarterly Reports on Form 10-Q for the interim periods ended January 31, 2020 and April 30, 2020, as amended,
and our other periodic and current reports filed with the SEC and available on www.sec.gov and with the Canadian
securities commissions available on www.sedar.com. Readers are cautioned that forward-looking statements are not
guarantees of future performance and that actual results or developments may differ materially from those
expressed or implied in the forward-looking statements. Any forward-looking statement made by us in this release is
based only on information currently available to us and speaks only as of the date on which it is made. We undertake
no obligation to publicly update any forward -looking statement, whether written or oral, that may be made from
time to time, whether as a result of new information, future developments or otherwise.