- Excellon Resources (TSXV:EXN) signed a non-binding offtake and loan agreement with Glencore to expedite the restart of the past-producing Mallay silver mine in Peru
- The mine produced 7.7 million ounces of silver, 123 million pounds of zinc and 85 million pounds of lead between 2012 and 2018 and retains significant exploration upside
- Excellon seeks to acquire advanced mineral development or production assets to create value for employees, communities and shareholders
- Excellon Resources stock has given back 32.5 per cent year-over-year
Excellon Resources (TSXV:EXN) signed a non-binding offtake and loan agreement with Glencore to expedite the restart of the past-producing Mallay silver mine in Peru, which produced 7.7 million ounces of silver, 123 million pounds of zinc and 85 million pounds of lead between 2012 and 2018 while retaining significant exploration upside.
The agreement, signed on May 15, sets the foundation for an offtake of 100 per cent of Mallay’s zinc-lead concentrate (containing silver by-product) until 2028-2029, as well as a US$7.5 million pre-export finance loan to support the ramp-up to production.
Excellon estimates that it has C$18 million in capital available for the restart, including an C$8 million equity financing closed on May 14.
The companies expect to finalize definitive agreements by the end of June.
Leadership insights
“Partnering with Glencore – one of the world’s foremost mining and commodity firms, with an extensive operational framework in Peru – is a transformational step for Excellon,” Shawn Howarth, Excellon Resources’ president and chief executive officer, said in a statement. “Glencore’s commitment is a strong vote of confidence in the quality and potential of the Mallay mine and in our team’s plan to bring the operation back into production. This agreement provides a non-dilutive financing solution, while also guaranteeing a home for our concentrates via a stable and secure offtake agreement at the most attractive terms presented to Excellon in a broader market tender. We look forward to a long and productive relationship with Glencore as we unlock Mallay’s value and continue to grow Excellon into a leading silver producer.”
About Excellon Resources
Excellon seeks to acquire advanced mineral development or production assets to create value for employees, communities and shareholders. Its portfolio includes the past-producing Mallay silver mine and Tres Cerros exploration project in Peru, the Kilgore advanced gold exploration project in Idaho, and Silver City, a high-grade epithermal silver project in Saxony, Germany, with minimal modern exploration.
Excellon Resources stock (TSXV:EXN) is up by 17.39 per cent trading at C$0.135 as of 10:09 am ET. The stock has given back 32.5 per cent year-over-year.
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