Silver Bull Resources, Inc. (OTCQB: SVBL, TSX: SVB) (“Silver Bull”)
announces Sociedad Cooperativa de Exploración Minera Mineros
Norteños, S.C.L. (“Mineros Norteños”), the group which is illegally
blocking the Sierra Mojada Project, has filed an appeal in the
recently reopened Mexican courts to try and overturn a favourable
ruling for Silver Bull on their lawsuit against the Company filed
in 2014.
Silver Bull expects a final ruling on the case,
which cannot be appealed by Mineros Norteños if won by Silver Bull,
to be handed down from the courts within the next 6 months.
Tim Barry, President, CEO and director of Silver
Bull states, “We are extremely disappointed to see Mineros Norteños
have filed an appeal against the third favorable ruling the Company
has received on the frivolous law suit they filed back in 2014. The
last favorable ruling was delivered to us in March of this year,
but unfortunately due to the rapid spread of the Corona Virus in
Mexico, the court system in Mexico has been shut down until very
recently, which has caused a significant delay in potentially
settling this case once and for all. Should Mineros Norteños lose
this appeal then Silver Bull will win the case outright. We
strongly believe the law suit filed by Mineros Norteños is without
merit and is largely being driven by their lawyer, who stands to
gain a considerable contingency payment if successful, and a small
radical group of approximately 10 Mineros Norteños members who do
not accurately reflect the sentiment of the much larger Mineros
Norteños group. According to our employees who live in the
community, the illegal blockade on the Sierra Mojada project is
manned by this small group and is an attempt to try and force the
Company into making a settlement on a lawsuit that is frivolous. We
remain committed to good faith dialogue with the Mineros Norteños
group, many of whom have worked for Silver Bull, to find a
solution, but to date any proposal put forward by Silver Bull has
been rejected, and any counter proposals from Mineros Norteños have
been completely unrealistic.
Whilst working on trying to find a settlement at
Sierra Mojada, Silver Bull continues its due diligence on the
Beskauga Project announced on 17 August 2020. The next step in the
due diligence process will be a visit to site when travel safely
allows.”
Summary of the law suit filed
by Mineros Norteños:
Silver Bull has an agreement with Mineros Norteños on two small
mineral licences which cover the eastern part of the Sierra Mojada
deposit. These licences are subject to a 2% production royalty to
Mineros Norteños capped at US$6.875 million (the “Royalty”) should
a mine go into production.
Since 2014, Silver Bull has been fighting a law
suit by Mineros Norteños seeking payment of the Royalty, including
interest at a rate of 6% per annum since August 30, 2004, even
though no revenue has been produced from the applicable mining
concessions. Mineros Norteños also sought payment of wages to the
Mineros Norteños members since August 30, 2004 under this
agreement, even though a mineral processing plant was never built
and none of the individuals were hired or performed work for Silver
Bull under this agreement and Silver Bull did not commit to hiring
them. On October 4, 2017, the court ruled that Mineros Norteños was
time barred from bringing the case. On October 19, 2017, Mineros
Norteños appealed this ruling. On July 31, 2019, the Federal Appeal
Court upheld the original ruling. This ruling was subsequently
challenged by Mineros Norteños and in March 2020 the Federal
Appeals Court upheld the original ruling. Mineros Norteños may
challenge the ruling for a final time at the Federal Circuit Court.
In an attempt to force Silver Bull into making a settlement,
Mineros Norteños has undertaken to illegally block access to the
project since September 2019. To ensure the safety of all involved,
Silver Bull has elected to halt all operations on the project until
a resolution can be found.
The joint venture option with South32 remains in
good standing but under a force majeure pause.
South32 Joint Venture
Option
In June 2018 Silver Bull signed an agreement
with a wholly owned subsidiary of South32 whereby Silver Bull has
granted South32 an option to form a 70/30 joint venture with
respect to the Sierra Mojada Project. To maintain the option in
good standing, South32 must contribute minimum exploration funding
of US$10 million ("Initial Funding") during a 4 year option period
with minimum aggregate exploration funding of US$3 million, US$6
million and US$8 million to be made by the end of years 1, 2 and 3
of the option period respectively. South32 may exercise its option
to subscribe for 70% of the shares of Minera Metalin S.A. De C.V.
("Metalin"), the wholly owned subsidiary of Silver Bull which holds
the claims in respect of the Sierra Mojada Project, by contributing
US$100 million to Metalin for Project funding, less the amount of
the Initial Funding contributed by South32 during the option
period. During the period of force majeure the year 2 completion
date has been extended by the period of force majeure.
About Silver Bull: Silver Bull
is a mineral exploration company whose shares are listed on the
Toronto Stock Exchange and trade on the OTCQB in the United States,
and is based out of Vancouver, Canada. Silver Bull owns the Sierra
Mojada Project which is located 150 kilometers north of the city of
Torreon in Coahuila, Mexico, and is highly prospective for silver
and zinc.
About the Sierra Mojada
deposit: Sierra Mojada is an open pittable oxide deposit
with a NI43-101 compliant measured and indicated "global" resource
of 70.4 million tonnes grading 3.4% zinc and 38.6g/t silver at a
$13.50 NSR cutoff giving 5.35 billion pounds of zinc and 87.4
million ounces of silver. Included within the "global" resource is
a measured and indicated "high grade zinc zone" of 13.5 million
tonnes with an average grade of 11.2% zinc at a 6% cutoff, giving
3.336 billion pounds of zinc, and a measured and indicated "high
grade silver zone" of 15.2 million tonnes with an average grade of
114.9g/t silver at a 50g/t cutoff giving 56.3 million ounces of
silver. Mineralization remains open in the east, west, and
northerly directions. Approximately 60% of the current 3.2
kilometer mineralized body is at or near surface before dipping at
around 6 degrees to the east.
The technical information of this news release
has been reviewed and approved by Tim Barry, a Chartered
Professional Geologist (CPAusIMM), and a qualified person for the
purposes of National Instrument 43-101.
On behalf of the Board of Directors "Tim Barry"
Tim Barry, CPAusIMM Chief Executive Officer,
President and Director
INVESTOR RELATIONS: +1 604 687 5800
info@silverbullresources.com
Cautionary Note to U.S. Investors
concerning estimates of Measured, Indicated, and Inferred
Resources: This press release uses the terms "measured
resources", "indicated resources", and "inferred resources" which
are defined in, and required to be disclosed by, NI 43-101. We
advise U.S. investors that these terms are not recognized by the
United States Securities and Exchange Commission (the "SEC"). The
estimation of measured, indicated and inferred resources involves
greater uncertainty as to their existence and economic feasibility
than the estimation of proven and probable reserves. U.S. investors
are cautioned not to assume that measured and indicated mineral
resources will be converted into reserves. The estimation of
inferred resources involves far greater uncertainty as to their
existence and economic viability than the estimation of other
categories of resources. U.S. investors are cautioned not to assume
that estimates of inferred mineral resources exist, are
economically minable, or will be upgraded into measured or
indicated mineral resources. Under Canadian securities laws,
estimates of inferred mineral resources may not form the basis of
feasibility or other economic studies. Disclosure of "contained
ounces" in a resource is permitted disclosure under Canadian
regulations, however the SEC normally only permits issuers to
report mineralization that does not constitute "reserves" by SEC
standards as in place tonnage and grade without reference to unit
measures. Accordingly, the information contained in this press
release may not be comparable to similar information made public by
U.S. companies that are not subject NI 43-101. Cautionary
note regarding forward looking statements: This news
release contains forward-looking statements regarding future events
and Silver Bull's future results that are subject to the safe
harbors created under the U.S. Private Securities Litigation Reform
Act of 1995, the Securities Act of 1933, as amended (the
"Securities Act"), and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and applicable Canadian securities
laws. Forward-looking statements include, among others, statements
regarding the timing of final court ruling and mineral resource
estimates. These statements are based on current expectations,
estimates, forecasts, and projections about Silver Bull's
exploration projects, the industry in which Silver Bull operates
and the beliefs and assumptions of Silver Bull's management. Words
such as "expects," "anticipates," "targets," "goals," "projects,"
"intends," "plans," "believes," "seeks," "estimates," "continues,"
"may," variations of such words, and similar expressions and
references to future periods, are intended to identify such
forward-looking statements. Forward-looking statements are subject
to a number of assumptions, risks and uncertainties, many of which
are beyond our control, including such factors as the results of
exploration activities and whether the results continue to support
continued exploration activities, unexpected variations in ore
grade, types and metallurgy, volatility and level of commodity
prices, the availability of sufficient future financing, and other
matters discussed under the caption "Risk Factors" in our Annual
Report on Form 10-K for the fiscal year ended October 31, 2019 and
our Quarterly Reports on Form 10-Q for the interim periods ended
January 31, 2020 and April 30, 2020, as amended, and our other
periodic and current reports filed with the SEC and available on
www.sec.gov and with the Canadian securities commissions available
on www.sedar.com. Readers are cautioned that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those expressed
or implied in the forward-looking statements. Any forward-looking
statement made by us in this release is based only on information
currently available to us and speaks only as of the date on which
it is made. We undertake no obligation to publicly update any
forward-looking statement, whether written or oral, that may be
made from time to time, whether as a result of new information,
future developments or otherwise.
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