JOHANNESBURG (miningweekly.com) – TSX-listed silver ore producer Great Panther Silver has acquired the Peru-based Coricancha gold-silver-lead-zinc-copper underground mine and mill complex (CMC) from subsidiaries of integrated mining and metals company Nyrstar.
The acquisition was completed on June 30 as a share purchase.
Great Panther will pay a purchase price to Nyrstar of $0.1-million, as well as an earn-out consideration of up to $10-million.
Under the earn-out, Nyrstar will be paid 15% of the free cash flow generated by CMC over the next five years, after which CMC’s cumulative free cash flow will be in the black.
"The acquisition of CMC represents a major milestone for Great Panther and the culmination of our search for the right asset to build a foundation in Peru," said CEO Robert Archer in a statement released Monday.
Great Panther's plans include further evaluations of the current mine and processing infrastructure, mine rehabilitation and development in preparation for underground drilling, environmental studies, and the initiation of a preliminary feasibility study (PFS).
Depending on the outcome of the PFS, capital investments in support of restarting operations could begin in 2018.
The company is currently working on an updated mineral resource estimate for CMC, which is expected to be completed towards the end of the third quarter of 2017.