MAG Silver Corp. (MVG) Executes Option Agreement to Acquire 100% Interest in San Ramone Property, Zacatecas, Mexico
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MAG Silver Corp. (Amex: MVG) reports that it has executed an option agreement to acquire 100% interest subject to a 1.5% Net Smelter Royalty in the San Ramone property in Zacatecas State, Mexico. The San Ramone property combined with MAG's existing adjoining holdings at Lagartos SE, gives MAG control of a significant portion of the eastern part of the historic Mala Noche silver vein system. The Lagartos SE area which has been a major focus of MAG's exploration efforts in the region is located 93 kilometres south of the Fresnillo District and the site of the Valdecanas vein discovery.
Under the four year agreement MAG may acquire a 100 per cent interest, from Castle Resources Limited, in the property subject to certain cash payments and work commitments. The San Ramone property is comprised of eight mineral concessions totaling 312.2 hectares situated approximately five kilometres northeast of the city of Zacatecas and immediately adjoining MAG Silver's large Lagartos south-east property (to view the attached diagram please click on http://media3.marketwire.com/docs/mag715.jpg and website at www.magsilver.com). The property covers the east portion of a former productive vein system that is one of the six principal high grade gold and silver vein sets comprising the Zacatecas Silver district. These vein systems have had significant past production of high grade gold and silver mineralization and production on the Mala Noche continues today from the San Roberto mine operated by Cozamin almost six kilometres west of the San Ramone area.
MAG recognizes that the Zacatecas District as the only major past producing silver province in Mexico that has not seen the same level of modern exploration as have many of the other significant silver districts. This new acquisition is in keeping with MAG's exploration philosophy that the Zacatecas district is host to significant extensions of many of the high grade vein systems. MAG controls all of the ground along the east and west flanks of this district and the San Ramone property acquisition adds significantly to MAG's coherent holdings along the east side.
The basic terms of the option agreement commit MAG Silver to expend US$500,000 during the first year and make a US$75,000 payment on signing of the agreement. For subsequent years, at its option, MAG is also required to make work expenditures of US$500,000 during the second year of the option, US$1,000,000 during the third year of the option, and US$1,250,000 during the fourth year of the option for total work related expenditures of US$3,250,000. In addition, MAG Silver has also agreed to an optional cash payment of US$750,000 on or before the fifth anniversary of the agreement. Castle will retain a 1.5% NSR in the project.
Under the four year agreement MAG may acquire a 100 per cent interest, from Castle Resources Limited, in the property subject to certain cash payments and work commitments. The San Ramone property is comprised of eight mineral concessions totaling 312.2 hectares situated approximately five kilometres northeast of the city of Zacatecas and immediately adjoining MAG Silver's large Lagartos south-east property (to view the attached diagram please click on http://media3.marketwire.com/docs/mag715.jpg and website at www.magsilver.com). The property covers the east portion of a former productive vein system that is one of the six principal high grade gold and silver vein sets comprising the Zacatecas Silver district. These vein systems have had significant past production of high grade gold and silver mineralization and production on the Mala Noche continues today from the San Roberto mine operated by Cozamin almost six kilometres west of the San Ramone area.
MAG recognizes that the Zacatecas District as the only major past producing silver province in Mexico that has not seen the same level of modern exploration as have many of the other significant silver districts. This new acquisition is in keeping with MAG's exploration philosophy that the Zacatecas district is host to significant extensions of many of the high grade vein systems. MAG controls all of the ground along the east and west flanks of this district and the San Ramone property acquisition adds significantly to MAG's coherent holdings along the east side.
The basic terms of the option agreement commit MAG Silver to expend US$500,000 during the first year and make a US$75,000 payment on signing of the agreement. For subsequent years, at its option, MAG is also required to make work expenditures of US$500,000 during the second year of the option, US$1,000,000 during the third year of the option, and US$1,250,000 during the fourth year of the option for total work related expenditures of US$3,250,000. In addition, MAG Silver has also agreed to an optional cash payment of US$750,000 on or before the fifth anniversary of the agreement. Castle will retain a 1.5% NSR in the project.
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