Dr. John-Mark Staude reports
RIVERSIDE RESOURCES SIGNS $2.25M THREE YEAR STRATEGIC ALLIANCE WITH HOCHSCHILD
MINING FOR GOLD-SILVER EXPLORATION IN WESTERN SONORA, MEXICO
Riverside Resources Inc. has signed a three-year, $2.25-million strategic exploration alliance with Hochschild Mining Holdings Ltd., for generative exploration throughout the prolific megashear gold belt in western Sonora, Mexico. The Alliance will focus on identifying potential new large precious metal deposits using Riverside's extensive technical knowledge and experience in Sonora. Hochschild will finance $750,000 on an annual basis ($2.25-million over three years) for generative exploration, and Riverside will be the operator for all exploration activities of the Alliance, while all decisions relating to the Alliance will be made jointly through a technical committee comprising two representatives from each of Riverside and Hochschild similar in structure to other exploration alliances that Riverside is currently operating in Canada and Mexico.
Properties that are identified and deemed to be of interest will become designated properties whereby Hochschild will have the opportunity to earn a 65-per-cent interest by completing a four-year, $5-million work program per property. As per the agreement, once earn-in on a designated property is completed, Hochschild would make a one-time payment to Riverside of $3-million and the property would then be advanced under a joint venture agreement.
Riverside's president and chief executive officer, Dr. John-Mark Staude, stated, "Riverside has tremendous exploration and technical strength in Sonora, and this strategic partnership brings capital and operating experience to further strengthen and accelerate exploration efforts in the region." Dr. Staude added: "We are excited to get going with Hochschild and already have a number of high-priority targets to pursue immediately. We look forward to building a solid relationship with Hochschild and are confident this partnership will add significant value to both organizations."
Hochschild's chief executive officer, Ignacio Bustamante, commented, "We are looking forward to working with Riverside and are confident that the significant exploration and technical knowledge and experience their team brings to this strategic alliance will prove beneficial for both companies."
Key alliance terms
The alliance will focus on gold deposits but will include deposits that may have elements ancillary and in addition to gold, including but not limited to silver, copper and molybdenum. Unless otherwise specified, Riverside will be the designated operator for all exploration activities of the alliance. All property acquisitions will be in the name of Riverside until earn-in is completed.
Projects designated for further advancement will enter the earn-in phase of the agreement. To complete the earn-in, Hochschild must spend a minimum of $5-million in exploration expenses with respect to the property within four years from the date the property becomes a designated project, with a minimum expenditure of $1-million in each of the first year and the second year. If Hochschild fails to meet the milestone, Riverside would have the right but not the obligation to acquire 100-per-cent ownership of the designated project. At any time after the completion of the milestone, Hochschild can elect to enter into a formal joint venture agreement with Riverside (incorporated or unincorporated), provided that it makes a one-time cash payment to Riverside of $3-million and has completed the minimum work investment. If Riverside's interest in a designated project is reduced to 10 per cent or less, its interest will be converted to a 2-per-cent NSR.
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