Santacruz Silver Mining Ltd. said Dec. 14 that it has amended the option agreement secured from a group of Mexican companies for 100% interest in the Veta Grande project.
As per the amendment, the initial payment of US$500,000 made on Dec. 13 entitled Santacruz to 100% of the cash flows generated at the property, under the agreement.
The remaining payments outstanding are US$500,000 by Dec. 13, 2018, US$2.5 million by Dec. 13, 2019, US$2.5 million by Dec. 13, 2020, US$5.0 million by Dec. 13, 2021 and US$4.5 million by Dec. 13, 2022. Santacruz will also grant a 1% net smelter royalty, starting Dec. 14, 2022, or will purchase the royalty for US$1.5 million.
Under the original option agreement, Santacruz was obliged to pay US$2.5 million in the initial installment.
Additionally, Carrizal Mining SA de CV will form a joint venture with Santacruz, pursuant to a letter of intent under which Carrizal will purchase a 20% working interest in the Veta Grande and Zacatecas properties from Golden Minerals Co. Carrizal will fully fund the cost of bringing Veta Grande's capacity up to full swing. Moreover, it will provide a surface diamond drill rig and drilling materials to conduct exploration drill campaigns at the Veta Grande project, the Navidad property and the Panuco deposit.