Silver Mines Ltd. will now make the A$5 million payment in two parts to purchase the remaining 15% interest in the Bowdens silver project in New South Wales, Australia, from Kingsgate Consolidated Ltd.
In late June, Silver Mines acquired an 85% stake in the Bowdens project from Kingsgate for A$20 million, and entered a deed of variation for the remaining interest.
Under the amended deed of variation, Kingsgate will receive a nonrefundable payment of A$1 million on Sept. 30, with the remaining A$4 million to be paid by Dec. 30.
If Silver Mines fails to pay the A$4 million balance in due time, an unincorporated 85%/15% joint venture will be formed on the property, with Kingsgate retaining 15%.
Meanwhile, Silver Mines is set to start a 15,000-meter drilling program to increase silver resources within, and in the immediate vicinity of, the current resource area.
Drilling will also focus on converting silver resources to higher levels of confidence as part of the feasibility study program, and will further test high-grade polymetallic mineralization at depth below the current resource area.
The company is also planning an expanded program of up to a further 20,000 meters to test exploration targets, including targets where substantial silver mineralization has been discovered but is yet to be fully evaluated.
Silver Mines intends to complete the feasibility study and lodge the environmental impact statement for the Bowdens project in 2017.