14:02 | Lima, Aug. 20 (ANDINA).
Canadian-based Duran Ventures announced that it has entered into a Letter of Intent with a well-funded private Peruvian mining company to earn a 70% interest in the company's Don Pancho Polymetallic silver-lead-zinc project located in Lima, Peru, for cash consideration of US$2.03 million.
The Don Pancho project covers an area of 800 hectares and is located nine kilometres west of the historical Santander silver-lead-zinc mine currently being developed by Trevali Resources Corp.
Mapping and sampling shows the silver-lead-zinc mineralization is associated with an extensive breccia zone.
Under the terms of the LOI the Peruvian company has the following option payment obligations to Duran: US$30,000 upon signing of the LOI; US$250,000 upon signing the definitive agreement; US$750,000 18 months after signing the agreement and one million dollars to exercise the optionee's purchase option to acquire 70% of the project no later than 42 months after signing the Agreement.
In addition, the Peruvian company has the following exploration obligations: undertake a diamond drill program of at least 3,000 metres on the project during the first 18 months after signing the agreement; incur exploration costs of at least US$3.5 million.
This amount includes the diamond drill program, on the project during the 36 months after signing the agreement and undertake to commence an economic study on the project within 36 months of signing the Agreement.
The LOI includes a provision for 60 day due diligence period by the Peruvian mining company.
Duran Ventures also announced that it has signed agreements with the local community at its Ichuna CopperSilver Project located 120 kilometres northeast of Arequipa in the department of Moquegua in Southern Peru and adjacent to the Chucapaca project of Gold Fields Limited and Compañía de Minas Buenaventura.
(END) JPC/MOC/LVT
Published: 8/20/2012