PERTH (miningweekly.com) – ASX-listed Azure Minerals has struck a deal with Canada’s Teck Resources to consolidate ownership of the Alacrán silver/gold/copper project, in Mexico.
Azure in 2016 gained full ownership of the Alacrán project from Teck under a 2014 agreement that required the company to sole fund $5-million of exploration expenditure over a four-year period.
Teck exercised a clawback right over 51% of the project in December of 2016, by sole-funding $10-million of exploration expenditure over a further four-year period, out to 2020.
During the clawback period, Teck was after the copper potential of the Alacrán project area, but the project has failed to meet expectations, Azure said on Thursday.
Subject to the finalsation of a definitive sales agreement, Azure will now once again gain full ownership of the Alacrán project by issuing Teck shares amounting to a 19.9% interest in Azure, as well as a 0.5% net smelter return royalty on the project, and a participation right on the proceeds of any sale of the project within a five-year period.
“Azure is very pleased to have reached this agreement with Teck. We welcome them as a substantial shareholder of the company and look forward to further progressing the Alacrán project for the benefit of both our companies and all shareholders,” said Azure MD Tony Rovira.
“I believe the Alacrán project holds significant potential in addition to the Mesa del Plata and Loma Bonita silver and gold deposits, discovered within the first two years of our exploration, and which together contain over 32-million ounces of silver and 150 000 oz of gold.”
Rovira told shareholders on Thursday that Azure’s work on the project would start by revisiting the project’s economic potential while further progressing exploration.