SilverCrest Mines gains on option to acquire adjacent Santa Elena property

Tue 10:28 am by Deborah Bacal

The Ermitano property, which consists of two concessions and stretches 165 sq km immediately adjacent to SilverCrest's Santa Elena mine, is located along the same trend of mineralization currently being mined at Santa Elena.

SilverCrest Mines (CVE:SVL) (NYSE MKT: SVLC) has signed a five-year option deal with Evrim Resources Corp. (CVE: EVM), giving the silver miner the right to acquire a 100% interest in the Ermitano property in Mexico, which sits next to SilverCrest's Santa Elena mine.

SilverCrest can earn a 100% stake in the property by paying US$75,000 on signing the agreement, which has already been paid, and US$50,000 on each anniversary thereafter, as well as paying a minimum of US$500,000 in exploration expenditures in the first year and delivering a production notice that specifies mine and construction plans with accompanying permits.

On vesting, SilverCrest will no longer be required to make the annual payments, and Evrim will retain a 2% net smelter royalty.

The Ermitano property, which consists of two concessions and stretches 165 sq km immediately adjacent to SilverCrest's Santa Elena mine, is located along the same trend of mineralization currently being mined at Santa Elena. Prospecting by Evrim has discovered a zone of low sulphidation epithermal veining, with a strike length of about 1,400 metres on surface.

The two concessions have not yet been drill tested, giving the companies immediate targets for a fast-track exploration program this year.

"The Ermitano Property offers SilverCrest the means to fast track the potential discovery of additional resources in the vicinity of the producing Santa Elena Mine," said Evrim president and CEO Paddy Nicol.

SilverCrest, a Mexican-focused miner, is working on expanding its flagship Santa Elena mine by constructing a 3,000 tonne per day mill, with the quick addition of discoveries providing further feed for the newly expanded mill. The mill expansion is expected to see initial start up in February.

Shares of SilverCrest rose 1.5% on Tuesday, to $2.07 in Toronto.