TSX-V-listed Golden Tag Resources on Wednesday announced the acquisition of the former producing La Parrilla silver mine, in Mexico, from First Majestic Silver for $33.5-million.
The La Parrilla mine was First Majestic’s first silver mine and produced 34.3-million ounces of silver-equivalent ounces under its ownership.
“Over the past two years we have evaluated several opportunities for growth in the silver space and La Parrilla is a great opportunity. The mine complex is fully permitted, located only 45 minutes on paved roads from Durango and, only a few hours from our existing San Diego project,” said Golden Tag president and CEO Greg McKenzie.
He stated that the acquisition was a “transformative” transaction for Golden Tag.
“Our short-term objective is to commence exploration within and near mine workings in order to expand the resource base, to support our ultimate goal and vision of placing the asset back into production.”
The asset has excellent infrastructure, including a 2 000 t/d processing facility, a dry stack filter plant with about nine years of tailings capacity available, numerous buildings, including a doré refinery, and a partial underground mining fleet.
Golden Tag would acquire the asset for $33.5-million, including an upfront equity consideration of $20-million and deferred payments of $13.5-million.
The company would raise at least C$9-million in equity, concurrent with the acquisition, with participation of $2.7-million from First Majestic