- Impact Silver (IPT) has signed a letter of intent to option its Nuevo Taxco Project in Mexico to Vancouver-based Red Oak Mining
- Red Oak may acquire a 100 per cent interest in the project by paying to Impact Silver C$300,000 in cash, issuing 3.5 million common shares and assuming $1.4 million in exploration expenses over a three-year period
- Impact Silver will also retain a one per cent net smelter royalty on the project, which Red Oak may acquire for $1 million
- The Nuevo Taxco Project has seen little exploration and development work to date, due to its distance from Impact Silver’s processing plants
- Impact Silver (IPT) is currently up 1.06 per cent and is trading at $0.95 per share
Impact Silver (IPT) has signed a letter of intent to option its Nuevo Taxco Project in Mexico to Vancouver-based Red Oak Mining.
Located on the northwest extension of the prolific Taxco Silver District, the silver and gold project covers 1,100 hectares and forms part of the historic Pregones Mining District, which is considered to be largely under-explored with no documented drilling work to date.
Under the terms of the agreement, Red Oak may acquire a 100 per cent interest in the Nuevo Taxco Project by paying to Impact Silver a total of C$300,000 in cash, issuing 3.4 million common shares and assuming $1.4 million in exploration expenses over a three-year period.
Impact Silver will also retain a one per cent net smelter royalty on the project, which Red Oak may acquire for a one-time fee of $1 million.
While the Taxco region has a strong reputation as a potential gold and silver producer, the Nuevo Taxco Project is beyond trucking distance from Impact Silver’s processing plants and, as such, has seen very little exploration work.
Fred Davidson, President and CEO of Impact Silver, said he is excited to be working with the Red Oak Mining team given their previous success in Mexico.
“While Impact exploration focuses on near-term increases to mine area tonnage and brownfield opportunities, transactions such as this one with promising junior explorers with access to capital allow Impact to unlock additional value and exploration upside without time commitment and capital from our team.
“With over 200 square kilometres of land, we believe we have just scratched the surface and invite a dynamic company such as Red Oak to share our exploration upside,” he added.
Impact Silver (IPT) is currently up 1.06 per cent and is trading at $0.95 per share at 2:37pm EDT.