TNR Gold Corp. and McEwen Mining Inc. Agree to Convert
TNR’s Back in
Right to a NSR on the Los Azules Copper Project, Argentina
Vancouver, B.C. October 17, 2014, TNR Gold Corp. (the "Company" or “TNR) (TSX VENTURE:TNR.V ) announces
that it has entered into a transfer agreement (the “Transfer
Agreement”) with McEwen Mining Inc. (NYSE:MUX, TSX:MUX) ("McEwen")
pursuant to which the Company will convert all of rights and interests
(the “E&O Agreement Rights”) under a Cordon de Los Azules
Exploration and Option Agreement dated effective as of May 15, 2004, as
amended April 26, 2005 and November 8, 2012, including its 25% back-in
right (the “Back-In Right”) in the northern portion of the Los Azules
Copper Project (the “Project”) in San Juan Province, Argentina. The
Back-In Right is exercisable following the completion of a feasibility
study and if the Company elected to back-in for 5% or less or had its
interest diluted to 5% or less, TNR would receive a net smelter royalty
of 0.6% from the northern portion of the Project (see TNR News Release
November 12, 2012).
In exchange for TNR converting the E&O Agreement Rights, McEwen will:(1) cause its wholly owned Argentinian subsidiary, Andes Corporacion Minera S.A. (“Andes”) to enter into a net smelter royalty agreement with Compania Minera Solitario Argentina S.A. (“Solitario”), an Argentinian company controlled by TNR, pursuant to which Andes will pay Solitario a 0.4% net smelter returns royalty (“NSR”) in respect of the entire Project;
(2) issue TNR 850,000 common shares; and
(3) pay TNR 1% of any purchase price paid to and received by McEwen in respect of any sale, assignment of transfer of all of its interest in the Project, to a party other than to an affiliate of McEwen, on or before the third anniversary of the Transfer Agreement.
The Company believes converting the E&O Agreement Rights are in the best interest of its shareholders because it clarifies the ambiguity surrounding the details of the Back-In Right and the conditions under which the Back-In Right can be exercised.
Gary Schellenberg, President and CEO of TNR commented, “We have noted significant confusion in some of our shareholders regarding the particulars of the Back-In Right. It is the goal of TNR, through its lead generator business model, to advance toward the royalty ownership model as our projects, identified at an early stage of exploration, are advanced toward development by joint venture partners. This latest agreement with McEwen now completes the process for the Los Azules Project.”
“We are very pleased to reach this agreement with McEwen. I would like to thank Rob McEwen personally for his efforts to work with us to find an amenable solution to simplify the Back-In Right at Los Azules. I am confident this transaction will facilitate the advancement of the Los Azules Project. Los Azules is a unique, long-life, copper mining opportunity in Argentina. Recent acquisitions which include the Las Bambas copper mining project in Peru acquired by Minmetals Group from China and the Taca Taca copper deposit in Argentina acquired by First Quantum Minerals Ltd. confirm there is significant value to be realized for projects in this region. TNR Gold now carries an industry standard NSR on the entire Los Azules project which also allows McEwen Mining to facilitate further strategic transactions with this Project and I believe the shareholders of TNR will benefit as the Project advances through the feasibility stages,” commented Mr. Kirill Klip, Non-Executive Chairman of TNR.
ABOUT LOS AZULES
The Los Azules copper deposit is located in the San Juan province of Argentina. McEwen is the current operator on the Los Azules copper deposit and the Company has previously advised that on May 15, March 28, and March 13, 2013, McEwen Mining Inc. issued press releases in relation to the deposit, which are accessible on SEDAR at http://www.sedar.com and on McEwen Mining Inc.’s website at http://mcewenmining.com.McEwen's press releases appear to be prepared by Qualified Persons and the procedures, methodology and key assumptions disclosed therein are those adopted and consistently applied in the mining industry, but no Qualified Person engaged by TNR has done sufficient work to analyze, interpret, classify or verify McEwen's information to determine the current mineral reserve or resource or other information referred to in their press releases. Accordingly, the reader is cautioned in placing any reliance on the disclosures therein.
ABOUT TNR GOLD Corp. (www.tnrgoldcorp.com)
Over
the past twenty-one years TNR, through its lead generator business
model, has been successful in generating high quality exploration
projects around the globe. With the Company's expertise, resources and
industry network, it is well positioned to aggressively identify,
source, explore, partner and continue to expand its project portfolio.
TNR
recently reported an inferred mineral resource at the Shotgun Gold
project in Alaska containing 20,734,313 tonnes at 1.06 grams per tonne
(“g/t”) gold for a total of 705,960 ounces gold (“Au”) using a 0.5 g/t
Au cut-off (see news release dated 22 April 2013).
TNR
is also a major shareholder of International Lithium Corp. (TSX:ILC.V)
(“ILC”), a company created by TNR to advance its internationally
acquired lithium prospects. TNR currently holds about 25.5% of the
outstanding shares of ILC.
At
its core, TNR provides significant exposure to gold and copper through
its holdings in Alaska and Argentina and is committed to continued
generation of in-demand projects, while diversifying its markets and
building shareholder value.
John
Harrop, PGeo, FGS, is a "Qualified Person" as defined under NI 43-101
and has reviewed and approved the technical content of this news
release.
For further details please see our website at http://www.tnrgoldcorp.com/s/NewsReleases.aspOn behalf of the board,
Gary Schellenberg
President
