An anonymous director reports
NEW PACIFIC CLOSES ACQUISITION OF ALCIRA, CHANGE OF BUSINESS, AND ANNOUNCES NAME AND TICKER SYMBOL CHANGE
New Pacific Holdings Corp.'s wholly owned subsidiary, New Pacific Investment Corp. Ltd., has closed its previously announced acquisition of Empresa Minera Alcira SA, a private Bolivian incorporated mining company, from its three shareholders pursuant to the terms of a share purchase agreement dated March 28, 2017.
Alcira has seven silver-polymetallic mineral properties or ATEs (temporary special authorization) in Bolivia. The most significant property is the Silver Sand property located in the Potosi department, which has been subjected to some small-scale historical mining and was drilled during the period 2012 through 2015 by Alcira. The other six are early-stage exploration projects which have either been subject to limited small-scale mining or historical drilling.
The company acquired Alcira for cash payments of $36-million (U.S.) to the vendors and pursuant to the terms of the agreement. The company is required to pay an additional $4-million (U.S.) within 90 days of closing, and a final payment of $5-million (U.S.) is due to the vendors once the company has received certain specified permits and licences from the authorities of Bolivia necessary for mining and milling operations, or once Alcira has commenced commercial production.
The acquisition constitutes a change of business of the company from an investment issuer to a resource issuer under TSX Venture Exchange policies. The company obtained shareholder approval to the change of business at its special meeting of shareholders held on June 30, 2017. The company's shares are currently halted in connection with the acquisition, and it is expected that trading will resume on July 24, 2017, at which time the company will be classified as a Tier 2 mining issuer on the TSX-V, will change its name back to New Pacific Metals Corp. and will trade under a new ticker symbol NUAG. The acquisition, change of business and the resumption in trading of the shares of the company are still subject to the final approval of the TSX-V.
In addition, the subscription receipts of the company issued to subscribers in the previously announced private placement which closed on July 17, 2017, have been automatically converted into common shares of the company with no further action upon behalf of the subscribers in connection with the closing of the acquisition. In connection with the private placement, the company has paid finders' fees to certain finders in the total amount of $393,300 (U.S.).
Results of confirmation drilling
According to the share transfer agreement reached between New Pacific and the shareholders of Alcira on March 28, 2017, New Pacific carried out a diamond confirmation drilling program from mid-April to the end of May, 2017, at Silver Sand. A total 1,546 metres were completed in four holes drilled on zone 1, of which three are twin holes (DSS4601 and ZK4601, DSS5401 and ZK5401, DSS6602 and ZK6601), and one hole DSS6601 is a scissors hole on section 66. Drill hole DSS4601 is located at approximately 1,100 metres north along the strike of zone 1 from the drill hole DSS6602; DSS5401 is located approximately in the middle of these two holes.
A total of 1,021 core samples were taken from the four confirmation holes by halving drill core with diamond saw with an average sampling interval of 1.5 metres. Samples were prepared and analyzed by ALS, a certified commercial analytical laboratory. Assay results of all core samples have been received. The attached table is a summary of mineralized intersections from the four confirmation drill holes on zone 1. For the historical drill holes and their results referred in this news release, please refer to the company's news release dated April 10, 2017.
Over all, the assay results of the confirmation drill holes are in conformity to historical drill results. On section 54, the confirmation twin hole DSS5401 compares very well with the historical hole ZK5401: 187.5 metres at 162 gram per tonne silver from the confirmation twin hole DSS5401, versus 195.3 metres at 168 gram per tonne silver from the historical hole ZK5401. The hole DSS5401 hit three mineralized intervals in zone 1 in comparison with four mineralized intersections hit the historical ZK5401. The third mineralized interval of DSS5401 is equivalent to a combination of the third and the forth intervals of ZK54101.
On section 66, the confirmation twin hole DSS6602 compares well with the historical holes ZK6601: 133.5 metres at 226 gram per tonne silver from the confirmation twin hole DSS6602, versus 191.3 metres at 245 gram per tonne silver from the historical hole ZK6601. Both holes hit three higher-grade mineralized intervals, but the length of intervals from DSS6602 is shorter, as the dip of DSS6602 is shallower. One low-grade mineralized interval was also hit in the footwall of zone in hole DSS6602. The scissors confirmation hole DSS6601 returned a mineralized interval of 102 metres at 197 gram per tonne silver, which consists of four higher-grade intersections. Results from this scissor hole largely confirmed the mineralization in zone 1 as modelled from results of the historical hole ZK6601. Besides the mineralized intersections of zone 1, several low-grade mineralized intervals were hit by DSS6601 in the footwall of zone 1.
On section 46, silver grades from the confirmation hole DSS4601 are much lower than those of the historical hole ZK4601 in spite of similar length of mineralized intersections from both holes, which are believed to be likely due to local geological variations.
SUMMARY OF MINERALIZED INTERSECTIONS OF CONFIRMATION DRILLING
Drill hole Cross-section Distance to Average sample Mineralized interval
(NE-SW) SE grid-end length From To Length Average Ag
(m) (m) (m) (m) (m) (g/t)
DSS4601 46 1,500 1.50 86 90.5 4.5 74
188 296 108 86
Including 188 246.5 58.5 134
Including 279.5 296 16.5 88
DSS5401 54 1,100 1.50 139.5 327 187.5 162
Including 139.5 157.5 18 150
Including 178.5 234 55.5 293
Including 283.5 327 43.5 256
DSS6601 66 500 1.50 31.5 37.5 6 39
scissors hole 67.5 79.5 12 33
96 105 9 88
144 169.5 25.5 40
187.5 289.5 102 197
Including 187.5 226.5 39 264
Including 231 235.5 4.5 76
Including 240 249 9 127
Including 256.5 289.5 33 251
DSS6602 66 500 1.50 48.5 182 133.5 226
Including 48.5 90.5 42 380
Including 107 149 42 218
Including 162.5 182 19.5 259
Quality assurance and quality control
Drill cores are HQ and NQ size. Core samples from the entire hole were split into halves by diamond saw cutting with an average sample interval of 1.5 metres. Half-cores are stored in a secured core storage rented by the company at a local town for future reference and check, and the other half-core samples were shipped in security sealed bags to ALS Global in Oruro, Bolivia, for preparation, and ALS Global in Lima, Peru, for geochemical analysis with the code of OG46.
A standard quality assurance and quality control protocol was employed to monitor the quality of sample preparation and analysis. Standards of certified reference materials, blanks and duplicates were inserted in normal core sample sequences prior to shipment to lab at a ratio of 30 to one (every 30 samples contain at least one standard sample, one blank sample and one duplicate sample). The assay results of QA/QC samples did not show any significant bias of analysis or contamination during sample preparation.
Donald J. Birak, an independent consultant geologist and qualified person as defined under National Instrument 43-101, has reviewed and approved the scientific and technical information in this news release.
About New Pacific Holdings Corp.
New Pacific is a Canadian investment company with investment focus on mineral resource industry. Silvercorp Metals Inc., the largest primary silver producer in China, is the major shareholder.
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