Mining News
SSR Mining to sell its Pitarrilla silver project in Mexico to Endeavour Silver for up to $127M
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(Kitco News) - SSR Mining (NASDAQ: SSRM/TSX: SSRM) announced today that it has entered into a definitive agreement to sell its Pitarrilla silver project in Mexico to Endeavour Silver for total consideration of up to US$127 million.
Total consideration consists of US$35 million in cash, US$35 million in Endeavour Silver shares, and a 1.25% net smelter return royalty on the Pitarrilla property currently estimated by SSR Mining to be valued at up to US$57 million.
The company said that in addition, Endeavour Silver has committed to incur a minimum of US$10 million in exploration expenditures on the Pitarrilla project over a five-year period following closing of the transaction.
“With this transaction, SSR Mining continues to deliver on its goal of portfolio rationalization, realizing value for shareholders by monetizing non-core assets. Together with the sale of our non-core royalty portfolio in the third quarter of 2021 and ongoing rationalization of non-core equity positions, SSR Mining has realized
in excess of US$235 million in aggregate consideration over the past 7 months," the company said in a statement.
The Pitarrilla project is a 100% owned grassroots discovery made by SSR Mining in 2002, located approximately 160 kilometres north-northwest of the city of Durango within the State of Durango, Mexico.
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The project has measured and indicated mineral resources of 496.5 million ounces of silver at an average grade of 97 g/t and 28.8 million ounces of silver at a grade of 165 g/t at Pitarrilla Underground, plus inferred mineral resources of 21.2 million ounces of silver at an average grade of 77.4 g/t and 5.5 million ounces of silver at a grade of 138.1 g/t at Pitarrilla Underground.
A feasibility study on the Pitarrilla project completed on December 14, 2012 delivered an after-tax NPV of $737 million at base case metal prices and $1.7 billion at spot metal prices. An after-tax IRR is 12.8% at base case metal prices ($27.50 per ounce of silver in the final pre-production year and the first two years of production, and $25 per ounce of silver thereafter).
SSR Mining is an intermediate gold company with four producing assets located in the USA, Turkey, Canada, and Argentina, combined with a global pipeline of development and exploration assets in the USA, Turkey, Mexico, Peru, and Canada. In 2020, the four operating assets produced approximately 711,000 gold-equivalent ounces.
