Panoro Minerals Ltd. (TSX.V: PML) has received a third payment of US$2.0 million as part of the Precious Metals Purchase Agreement with Silver Wheaton Corp. (TSX: SLW) with respect to the Cotabambas project in Peru.
The principal terms of the Cotabambas Early Deposit Agreement are as described in the Company’s press release on March 21, 2016, whereby Silver Wheaton will pay Panoro upfront cash payments totalling US$140.0 million for 25% of the payable gold production and 100% of the payable silver production from the Company’s Cotabambas Project in Peru. In addition, Silver Wheaton will make production payments to Panoro of the lesser of the market price and US$450 per payable ounce of gold and US$5.90 per payable ounce of silver delivered to Silver Wheaton over the life of the Cotabambas Project.
Panoro is entitled to receive US$14.0 million spread over a period of up to 9 years as an early deposit with payments to be used to fund general and administrative expenses related to the Cotabambas Project. The Cotabambas Early Deposit Agreement includes provisions to accelerate these payments through Silver Wheaton’s matching, up to certain limits, any third party financing of Panoro targeted for exploration at the Cotabambas Project. The balance of the US$140.0 million, should Silver Wheaton elect to proceed with the Cotabambas Early Deposit Agreement, is payable in installments during construction of the Cotabambas Project.
The payment of US$2.0 million comprises the matching payment for Year 1 of the Cotabambas Early Deposit Agreement whereby, pursuant to the Cotabambas Early Deposit Agreement, Silver Wheaton is required to match up to US$2.0 million of any financing Panoro raises from third parties for investment into the Cotabambas Project. Panoro announced the closing of a C$6.6 million financing on August 29, 2016, whereby the principal use of proceeds is investment into the Cotabambas Project, including:
- Step-out drilling to expand the oxide copper resource and assessment of the potential to incorporate a heap leach SX/EW process into the project plan;
- Exploration geophysics and drilling at the Maria Jose target to add near surface high grade mineralization to the mill feed; and
- Metallurgical testing to test for potential improvement in recoveries from all four mineralogical types in the current resource.
With the receipt of this matching payment, Panoro will have closed the following financings in 2016 totalling: C$12.0 million.
- C$5.4 million (US$4.0 million) from Cotabambas Early Deposit Agreement; and
- C$6.6 million from the private placement on August 29, 2016.
Panoro has commenced pre-drilling work at the Cotabambas Project. The Company expects to finalize the renewal of a community agreement at the Cotabambas Project shortly, after which it will commence a geophysical survey and other work leading to commencement of drilling at the Maria Jose prospect.
About Panoro
Panoro is a uniquely positioned copper exploration company focused on Peru. Panoro is advancing its significant portfolio of copper and gold projects in the key Andahuaylas-Yauri belt in south central Peru, including its advanced stage Cotabambas Copper-Gold-Silver-Molybdenum and Antilla Copper-Molybdenum Projects.
Since 2007, the Company has completed over 70,000 m of exploration drilling at these two key projects leading to substantial increases in the resource base for each. The mineral resources for each project are summarized in the table below.
Source: Panoro Minerals
