Benz Mining Enters Into Purchase Agreement to Acquire Mel Zinc-Lead-Barite Project in Southeast Yukon
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Mar 14, 2017) - Benz Mining Corp. (NEX:BZ.H) (the "Benz" or "Company"), is pleased to announce that it has entered into a purchase agreement with Silver Range Resources Ltd. ("Silver Range"), pursuant to which Benz has an option to purchase 100% of Silver Range's wholly-owned Mel zinc-lead-barite project (the "Project") located near Watson Lake in southeast Yukon for CAD $2.7 million.
The Project has an inferred historical mineral resource estimate of 5.38Mt at a grade of 6.45% zinc, 1.85% lead and 44.79% barite, as declared in the Technical Report by Gary Giroux, P. Eng., MASc. of Giroux Consulting Ltd. and Mr. Leo King of H. Leo King & Associates Inc., in November 2014. The Technical Report has been completed for Silver Range and can be found on SEDAR.
"The Mel Project represents an excellent opportunity to acquire an advanced exploration zinc/lead/barite project in a well established, low risk mining jurisdiction with an existing mineral resource estimate and significant exploration upside," said Miloje Vicentijevic, President and CEO of Benz.
The Project lies on a trend of significant zinc deposits including the past-producing Faro lead-zinc mine, Yukon Zinc's Wolverine mine, and Fireweed's (formerly Hudbay's) Tom and Jason deposit to the north and Teck's Cirque deposit, Canada Zinc's Akie deposit to the south.
Mr. Vicentijevic also stated, "We believe that the Mel zinc deposit is underexplored and offers significant exploration upside. The Project is especially exciting as the Mel Main zone (which hosts the inferred mineral resource estimate) is open in all directions and the Jeri, Jeri North and Mel East zones offer potential for near surface development opportunities."
THE PROJECT
The Mel Project consists of 257 claims, encompasses an area of 9,315 hectares and is located 80 kilometers east-northeast of the town of Watson Lake. The Project extends 47 km south from the main exploration targets to the Alaska Highway, following the route of a proposed haulage road.
The Project is underlain by a Cambrian to Ordovician-age sequence of marine sediments with minor coeval volcanics, which host stratabound zinc-lead-barite mineralization. The host stratigraphy is broadly folded into a north-trending overturned syncline. This synclinal structure has been disrupted by north and northeast-trending faults having both vertical and lateral displacements. Four (4) zones of zinc-rich mineralization have been discovered on the Project - the Mel Main, Jeri, Jeri North and Mel East Zones. Three of them, the Mel Main, Jeri, and Jeri North Zones, have been tested by total of 90 diamond drill holes (16,759 m).
At the Mel Main Zone, mineralization consists of coarse-grained sphalerite and galena disseminated throughout a mixture of mudstone, silica, carbonate and coarse crystalline barite. Minor amounts of fine-grained, sparsely disseminated pyrite occur locally, but overall, pyrite accounts for less than 2% of the sulphides. The Mel Main Zone has a strike length of about 700 metres and extends from surface to a depth of over 600 metres. It remains open to extension at depth and has potential for expansion.
MINERAL RESOURCES
The Mel Main Zone historical mineral resource estimate was completed by Gary Giroux, P. Eng., MASc. of Giroux Consulting Ltd. and Mr. Leo King of H. Leo King & Associates Inc.
To view the table please click the following link: http://media3.marketwire.com/docs/BENZ-Table-314.pdf
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.
The Project is subject to underlying royalties of 2% of net smelter returns, of which 1% can be bought down for $1,000,000.
AQUISITION TERMS
The Company purchased the Project from Silver Range for total consideration of $2,700,000 million with $475,000 required to be paid in cash and the balance of $2,225,000 payable in shares or cash at the Company's election. The payment schedule is summarized below.
| Mel Project Acquisition Payment | ||
| Cash | Portion Payable in Shares | |
| Upon Exchange Acceptance | $20,000 | |
| 4 Months | $80,000 | |
| 1st Anniversary | $150,000 | $75,000 |
| 2nd Anniversary | $300,000 | $150,000 |
| 3rd Anniversary | $300,000 | $150,000 |
| 4th Anniversary | $1,200,000 | $1,200,000 |
| 5th Anniversary | $350,000 | $350,000 |
| Total Price | $2,700,000 | $2,225,000 |
The Company has agreed to pay a finder's fee to a third party in accordance with the policies of the TSX Venture Exchange, which prescribe limits of 10% of the first $300,000 of value, 7.5% from $300,000 to $1,000,000 of value and 5% of the balance of value. Such finder's fee is subject to the approval of the TSX Venture Exchange.
EXCHANGE LISTING
The Company completed a private placement on March 12, 2017 for gross proceeds of $500,000. With funding in place and an agreement to acquire a mineral project, the Company plans to seek approval from the TSX Venture Exchange to graduate from the NEX board to become a tier 2 issuer on the TSX Venture Exchange.
The acquisition of the Project and the graduation from the NEX board are subject to the approval of the TSX Venture Exchange.
EXPLORATION PLANS
Pre-field preparation work is under-way currently and is focusing on data compilation and establishing one single source for past work data on the Project; and complete a NI 43-101 Technical Report.
Technical information in this press release has been approved by Miloje Vicentijevic, P. Eng. qualified person for the purposes of National Instrument 43-101.
On behalf of the Board of Directors of Benz Mining Corp.
Miloje Vicentijevic, President and Chief Executive Officer
About Benz Mining: Benz Mining is focused on acquiring and developing mining assets in safe jurisdictions and is led by a team of experienced mine developers.
Certain statements in this press release may be considered forward-looking information. These statements can be identified by the use of forward looking terminology (e.g., "expect"," estimates", "intends", "anticipates", "believes", "plans"). Such information involves known and unknown risks -- including the availability of funds, the results of financing and exploration activities, the interpretation of exploration results and other geological data, or unanticipated costs and expenses and other risks identified by Benz in its public securities filings that may cause actual events to differ materially from current expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.
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