Vancouver, B.C., January 22, 2018 - Panoro Minerals Ltd. (TSXV: PML, Lima: PML, Frankfurt: PZM) (“Panoro”, or the “Company”) is pleased to provide a review of 2017 and the CEO’s outlook and Company plans for 2018.
2018 is shaping up to be a transformational year for Panoro Minerals Ltd. The Company is well financed through to 2020; exploration results are identifying expansion potential for the Cotabambas project; and strengthening copper prices are indicating the development of a new copper bull market. Panoro is uniquely positioned in the copper exploration/development space to deliver two advanced stage copper projects located in Southern Peru, the prime copper development district in the world.
2017 was an important year of growth for Panoro following the 2016 year when the Company’s balance sheet was strengthened. The combined impacts of Panoro’s exploration program successes together with improved copper market fundamentals and increased market awareness programs resulted in a significant increase in Panoro’s stock price. After a low of $CA 0.15 in March 2017, and over two years at or below $CA 0.20, the stock price increased to a peak of $CA 0.475 in August and closed the year at $CA 0.38 cents.
During 2017 Panoro carried out an extensive exploration program at Cluster 1 of the Cotabambas Project. The exploration work included:
- Geologic Mapping of 280 hectares, 40% of the total to date;
- Rock chip sampling of 1,072 samples, 24% of the total to date;
- Geophysical surveys of:
- 68.2 km of Induced Polarization, 44% of the total to date; and
- 45.2 km of Magnetics, 22% of the total to date.
- Diamond Drilling of 6,632.6 m distributed over 30 Drillholes, 8% of the total to date.
The exploration work focused on four satellite targets within Cluster 1 of the Cotabambas Project. The drilling results confirmed the presence of:
- Oxide copper mineralization, near surface, at the Petra-David Target;
- Oxide gold mineralization, near surface, at the Breccia Target; and
- Oxide and sulphide copper mineralization near surface, at the Maria Jose Target.
These targets are located from 0.5 km to 1.5 km to the north, west and northwest side of the proposed open pit.
The oxide copper zones are identifying the potential to add a heap leach SX/EW process to the early part of the proposed mine life to increase copper production at a lower average operating cost, with limited additional startup capital. The oxide gold zones may add additional mill feed for blending to increase gold production. The sulphide mineralization intersected at Maria Jose has identified the potential to add additional higher grade mill feed for the proposed concentrator. Together these zones hold the potential to increase copper, gold and silver production and increased grades for the early part of the mine life, increase the mine life and increase the project value. Additional drilling in 2018 will follow up the 2017 drilling at these targets to further delineate the intersected zones of mineralization. Other areas of potential mineralization within Cluster 1 are also being mapped.
Approximately $CA 1.2 million of warrants have been executed, including the warrants held by Hudbay Minerals, from the Company’s 2016 private placement financing which included ½ warrant priced at $CA 0.27. The Company’s stock has been trading strong volumes well above the strike price of these warrants.
Panoro’s successful financing in 2016 allowed the Company, during 2017, to obtain an additional $US 2.0 million of accelerated payments from the streaming agreement completed in 2016 with Wheaton Precious Metals Ltd (“WPM”). Pursuant to the agreement with WPM, Panoro receives basic payments annually totalling $US 1.5 million. Accelerated payments of $US1.5 million may be received in 2018, in addition to the basic payments.
Early in January 2018 the Company announced the sale of the Kusiorcco Project to Hudbay Minerals, which closed at the end of 2017. The Kusiorcco project is located 6 km from Hudbay’s Constancia mine. Panoro will receive up to $US 5 million in cash plus a 2% net smelter return (NSR) royalty, and to date has received the initial payment of $US 3 million. Hudbay has subsequently announced that they are working on the obtaining the permits to commence exploration at Kusiorcco where they will be highly motivated to identify resources to begin feeding their existing concentrator plant at Constancia. The cash payments provide immediate benefit to Panoro as the funds will be directed to the continued expansion drilling programs at Cotabambas. In the medium and longer term the NSR royalty will provide funding for the advancement of Panoro’s project pipeline into the future.
The agreements with Wheaton Precious Metals and Hudbay Minerals demonstrate the Company’s ability to creatively leverage its portfolio of projects to secure non-dilutive short and long term financing. Through 2016 and 2017 Panoro has secured its financing needs through to 2020. The Company has estimated funding of $CA 19.3 million through to Dec 2019.
The lack of new global copper supply together with strong demand growth are indicating the early stages of a new copper bull cycle. After starting the 2017 year in the range of $2.60/lb, copper prices hit a low of approximately $2.50/lb in April before climbing to over $3.20/lb by the end of the year. If you recall, in late 2015 the copper price was below $2.00/lb. General consensus is that the copper price should continue to be a strong performer through 2018 and beyond. The quicker than expected adoption rate of electric vehicles and strong global economic growth coupled with the lack of supply resulting from years of underinvestment present a thesis for sustainably higher copper prices. The Cotabambas Project is uniquely prepared for the returning acquisition appetite by copper miners.
In 2018 Panoro is planning to continue its exploration program at Cluster 1 and then expanding exploration into Cluster 2. Approximately four to 5,000 m of additional drilling in Cluster 1, together with additional mapping and geophysics programs are planned. Drilling will focus on the Maria Jose and Petra-David targets to delineate additional oxide and sulphide copper zones. Similarly, approximately four to 5,000 m of drilling is planned for the Chaupec Target at Cluster 2. The Chaupec target is an area of skarn and porphyry mineralization exposed at surface along approximately 3 km. The copper grades sampled at surface are some of the highest grades sampled to date at the Cotabambas Project. The drilling will commence in the first quarter of 2018 and continue through much of the year.
Panoro will also commence a review of the Antilla Project. Internal studies completed in 2017 have indicated that the Antilla Project may have stronger economics at a smaller scale with a mine plan focused on the high grade, near surface mineralization processed with a heap leach SX/EW process. This review is planned for the first quarter of 2018. The Company intends to carry out a strategic review of the exploration and development alternatives for Antilla following the completion of this work.
Panoro will continue adding value to the Cotabambas Project through targeted exploration drilling. The Company’s financial position is strong with funding already in place to 2020. Our planned work, financial position and the strengthening copper market present an exciting combination. We have achieved much in 2017 and expect to achieve more in 2018.
On behalf of the Board of Panoro Minerals Ltd.
Luquman Shaheen. PEng, PE, MBA
President & CEO
FOR FURTHER INFORMATION, CONTACT:
|Panoro Minerals Ltd.|
Luquman Shaheen, President & CEO
Phone: 604.684.4246 Fax: 604.684.4200
|Renmark Financial Communications Inc.|
Tel.: (416) 644-2020 or (416) 939-3989
CAUTION REGARDING FORWARD LOOKING STATEMENTS: Information and statements contained in this news release that are not historical facts are “forward-looking information” within the meaning of applicable Canadian securities legislation and involve risks and uncertainties.
Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ materially from those expressed or implied by the forward-looking statements, including, without limitation:
- risks relating to metal price fluctuations;
- risks relating to estimates of mineral resources, production, capital and operating costs, decommissioning or reclamation expenses, proving to be inaccurate;
- the inherent operational risks associated with mining and mineral exploration, development, mine construction and operating activities, many of which are beyond Panoro’s control;
- risks relating to Panoro’s ability to enforce Panoro’s legal rights under permits or licenses or risk that Panoro’s will become subject to litigation or arbitration that has an adverse outcome;
- risks relating to Panoro’s projects being in Peru, including political, economic and regulatory instability;
- risks relating to the uncertainty of applications to obtain, extend or renew licenses and permits;
- risks relating to potential challenges to Panoro’s right to explore and/or develop its projects;
- risks relating to mineral resource estimates being based on interpretations and assumptions which may result in less mineral production under actual circumstances;
- risks relating to Panoro’s operations being subject to environmental and remediation requirements, which may increase the cost of doing business and restrict Panoro’s operations;
- risks relating to being adversely affected by environmental, safety and regulatory risks, including increased regulatory burdens or delays and changes of law;
- risks relating to inadequate insurance or inability to obtain insurance;
- risks relating to the fact that Panoro’s properties are not yet in commercial production;
- risks relating to fluctuations in foreign currency exchange rates, interest rates and tax rates; and
- risks relating to Panoro’s ability to raise funding to continue its exploration, development and mining activities.
This list is not exhaustive of the factors that may affect the forward-looking information and statements contained in this news release. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward‑looking information. The forward‑looking information contained in this news release is based on beliefs, expectations and opinions as of the date of this news release. For the reasons set forth above, readers are cautioned not to place undue reliance on forward-looking information. Panoro does not undertake to update any forward-looking information and statements included herein, except in accordance with applicable securities laws.
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