MONTREAL, Feb. 22, 2016 /CNW/ - Cyprium Mining Corporation
("Cyprium" or the "Company") (TSX-V: CUG and CUG.DB)
is pleased to announce that it has signed an agreement with
Chihuahua, Mexico based mining
contractor Bergmann Mexico SA de CV with respect to the
rehabilitation of shaft #3 of the Company's Potosi silver mine located in the historic
Santa Eulalia mining district in
northern Mexico.
Mr. Alain Lambert, Chairman and
CEO of Cyprium commented: "The rehabilitation of shaft #3 is an
important step towards restarting production at Potosi. The rehabilitation of shaft #3 is
expected to take about six weeks at which point we expect to be
able to start small scale production. The goal of this project is
to gain access to mine levels 3 and 4 which were last mined between
2010 and 2012. Once production resumes, Cyprium intends to send the
mineralized material extracted through shaft #3 of the Potosi silver mine to the Aldama plant."
The rehabilitation of shaft #3 consists mainly in the
installation of a new hoist, the overhaul of the rail system for
the extraction of mineralized material and the installation of the
necessary drilling and mining equipment and infrastructure at level
3 and 4 of the mine.
Once Cyprium receives the second tranche of the US $4.5 million bond financing announced in
March 2015 (the "Bond
Financing") for an amount of approximately US $1 million Cyprium intends to further invest in
the mining activities at level 3 and 4 with a view of increasing
the production capacity. With the remaining US $2.5 million of the Bond Financing expected to be
received later this year, Cyprium will finalize its plans regarding
the rehabilitation of the larger and deeper shaft #5 of the
Potosi silver mine which will
provide access to all levels of the mine down to level 11. The
rehabilitation of shaft #5 is expected to take about twelve months.
Once shaft #5 is rehabilitated, the initial exploration and
production will focus on levels 9 and 10 where the most recent
exploration activities have taken place. At that time, Cyprium will
also finalize plans regarding the possible rehabilitation of the
San Guillermo processing plant
which forms part of the Potosi
joint venture.
Cyprium has been informed in writing by the fund manager
subscribing to the Bond Financing that the disbursement of the
second tranche is expected to occur in March
2016. The bonds will bear interest at a rate of 12.5% per
annum, calculated and payable quarterly in arrears. The second
tranche was expected to be disbursed in 2015 for an amount of US
$2 million. The delay in the
disbursement of the second tranche and the reduction from an
expected amount of US $2 million to
US $1 million is solely related to
the liquidity situation of the fund subscribing to this financing
and not as a result of any conditions not met by Cyprium. In the
meantime, Cyprium is evaluating other financing alternatives to
supplement the Bond Financing. Finally, the Company announces that
Isabelle Gauthier has resigned as
Chief Financial Officer of the Company and is replaced in the
interim by Ronald Keenan, the
Company's Chief Operation Officer. The Company has already
initiated a search for a new Chief Financial Officer with relevant
experience in the mining sector.
About Cyprium Mining Corporation
For the description of Cyprium Mining's business and the
Company's Forward Looking Statement Disclaimer which form an
integral part of this news release please visit our website at:
http://www.cypriummining.com/en/investors/disclaimers
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
SOURCE Cyprium Mining Corp