Willem Fuchter reports
ABRAPLATA REACHES AGREEMENT TO PRESERVE TITLE TO THE DIABLILLOS AG-AU PROJECT IN ARGENTINA
Abraplata Resource Corp. has reached an agreement to acquire certain third party mineral rights that, as a result of a long-standing border dispute between two neighbouring provinces in northwestern Argentina, overlap, and potentially conflict with, the company's mineral rights to its Diablillos silver-gold project. The acquisition of the potentially conflicting mineral rights will allow the company to retain its title to the Diablillos silver-gold project regardless of the ultimate outcome of the provincial border dispute.
The Diablillos property lies within the border zone between the province of Salta and the province of Catamarca. For many years, the definitive border line between Salta and Catamarca has been in dispute, and the Diablillos property falls within territory claimed by both provinces. In 1984, the government of Salta granted mineral rights to the Diablillos property to one of the company's predecessors in title. In the early 2000s, the government of Catamarca granted to a third party mineral rights in the same area, some of which overlapped with the Diablillos mineral rights previously granted by the government of Salta, thereby creating the potential for conflicting titles pending the resolution of the border dispute, a matter falling within the jurisdiction of the federal government under the Constitution of Argentina. Additional details respecting the provincial border dispute and the potentially conflicting titles to the Diablillos property can be found in the company's filing statement dated March 1, 2017, a copy of which is filed under the company's profile on SEDAR.
The company has reached an agreement with the shareholders of Minera Cerro Bayo SA, the owner of the conflicting mineral rights granted by the government of Catamarca, to acquire a 100-per-cent equity interest in Cerro Bayo, thereby indirectly acquiring ownership and control of the conflicting mineral interests. As consideration, the company will pay $3,325,000 (U.S.) in cash and issue 500,000 common shares of the company to the shareholders of Cerro Bayo in instalments over a five-year period. The agreement is subject to approval by the TSX Venture Exchange as well as legal due diligence and negotiation of definitive documentation.
"We are extremely pleased to finally resolve the overlapping claims situation at Diablillos," commented Hernan Zaballa, executive chairman of Abraplata, adding that "... the uncertainty created by the provincial border dispute has confounded previous operators in the past and, by owning the overlapping rights on both sides of the dispute, we have effectively removed a key obstacle to the further development of the Diablillos project."
Despite the company's belief that its existing title to the Diablillos property should ultimately prevail once the provincial border dispute is finally decided by the federal government of Argentina, resolution of the dispute may take many years and, as long as the dispute remains continuing, uncertainty as to the integrity of the company's title would otherwise continue to exist, thereby hampering the company's efforts to develop the project. The company is aware of other mining companies operating in the vicinity of the Diablillos property that, in the face of similar potential title risks resulting from the provincial
border dispute, have used the same strategy as Abraplata to mitigate the risks by acquiring and effectively consolidating ownership and control of any and all overlapping and potentially conflicting mineral rights granted by both Salta and Catamarca.
Willem Fuchter, PGeo, president and chief executive officer of Abraplata Resource and a qualified person as defined by National strument 43-101, standards of disclosure for mineral projects, has reviewed and approved the scientific and technical information contained in this news release.
About Abraplata Resource Corp.
Abraplata is a junior mining exploration company focused on delivering shareholder returns by unlocking mineral value in Argentina. The company's experienced management team has assembled an outstanding portfolio of gold, silver and copper exploration assets and is focused on advancing its flagship Diablillos property through the various stages of feasibility.
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