TORONTO (miningweekly.com) – Vancouver-based Aurcana Corporation has signed a definitive agreement for the sale of its Rosario project, in Mexico's Sinaloa state, to Silvermex Resources.
Silvermex will pay C$250 000 for the asset and will reimburse Aurcana for all maintenance spending from August 1 until November 15, which is the deadline for the cash payment.
Silvermex will also issue one-million shares to Aurcana when the transaction closes, and another one-million shares either when the asset starts commercial production or within 24 months after the sale become effective.
Further, on the earlier of six months after commercial production is achieved or 30 months from the effective date, Silvermex will pay Aurcana a total of $2,5-million in five instalments of $500 000 over a period of 36 months.
The Rosario silver/gold/lead/zinc mine, which was in production under Grupo Mexico between 1986 and 2000, is located two kilometres away from Silvermex's own San Marcial project.
Silvermex also assumed the payment obligations to Grupo Mexico due in August 2009 and February 2010.
The companies first announced the planned sale in May this year.
Aurcana operates the La Negra mine, which it is expanding, and plans to start developing the Shafter silver mine, in Texas, next year.