TSX-V: MKO
VANCOUVER, Aug. 9, 2019 /CNW/ - Mako Mining Corp. (TSXV:
MKO) ("Mako") is pleased to provide an update on its recently
completed rights offering; progress at its fully-permitted San
Albino project in Nueva Segovia,
Nicaragua ("San Albino") where we
are developing a high-grade open pit gold mine next year; the
closing down of its La Trinidad
mine in Sinaloa, Mexico; and
management and board changes, including the appointment of
Akiba Leisman, formerly Interim CEO,
as CEO of Mako.
Completion of the Rights Offering
On July 23rd, Mako
completed a fully subscribed $27
million rights offering to fund the majority of construction
capital for San Albino. Affiliates of Wexford Capital LP
("Wexford") purchased 72% of the financing, with strong support
from existing shareholders. Wexford currently owns
approximately 55.3% of the issued and outstanding shares of Mako,
and we believe our shareholder base is fully supportive of our
strategy to advance the San Albino project into production.
Appointment of New Director
The board has appointed Paul M.
Jacobi, a Managing Director at Wexford, to the board of
directors of Mako. At Wexford, Paul was part of the Private
Equity team which created Diamondback Energy Inc.
("Diamondback"). Diamondback is a US$15 billion energy exploration and production
company focused on the Permian Basin, and is now a member of the
S&P 500.
Nicaragua Update
We are rapidly advancing the construction of our San Albino
project. Ground clearing activities are nearly complete, and
civil works are well underway. Long lead pieces of
equipment are being procured on the secondary market, and the
project is on track to begin commercial production by late summer
of 2020.
A 7,000-meter infill program at San Albino has been
commissioned, with over 1,000 meters completed to date. Two
core rigs are operating at San Albino with a third rig ready for
commissioning later this month. Assays from the infill
program will be consistently reported over the course of the coming
weeks.
An additional core rig is focused on exploration drilling at the
Las Conchitas property 3 kilometers to the south of San
Albino. We have reported encouraging results, and will
continue to report assays as received.
Mexico Update
Gold production from the La
Trinidad mine in Sinaloa,
Mexico is nearing completion. Mining operations
ceased at the end of March (see Press Release dated April 1, 2019). Most of our crushing plant has
been moved from the site and will either be sold or used at San
Albino. Any equipment used for Nicaragua will incrementally lower the capital
cost of the San Albino project.
To date, we have been unsuccessful in receiving any insurance
proceeds from our claim due to the damages sustained at
La Trinidad from Hurricane Willa
in October 2018. Legal actions
have commenced against the insurance provider and their
reinsurers.
Discussions are underway with the mining contractor for
La Trinidad and the Mexican
government regarding significant payables still outstanding at
our Mexican subsidiary that holds La Trinidad. We believe
that we have appropriately structured our Mexican subsidiary such
that these liabilities do not extend outside of Mexico, whereby any proceeds from the sale of
the equipment, or success in the insurance litigation, will be for
the benefit of Mako. Notwithstanding this, constructive
discussions are proceeding with the mining contractor with the goal
of reaching a mutually acceptable settlement, which will be
reported on as appropriate.
All other assets held in Mexico
will be sold or liquidated in due course.
Management Changes
The Board has appointed Akiba
Leisman, a director, and formerly Interim CEO, as CEO of
Mako. Jesse Muñoz will continue to lead the operations as
COO, and Frank Powell and
Zoran Pudar will continue
spearheading our mine and regional exploration programs
respectively. Additionally, Cesar
Gonzalez, currently a director of Mako, has been appointed
to the newly created role of Vice President of Corporate
Development.
"We are focusing Mako on generating returns for our
shareholders" said Mako's CEO, Akiba
Leisman, "and we believe that to achieve this, we have to
execute on two main objectives:
- To complete the construction of the San Albino gold mine on
time and on budget; and
- To successfully execute an aggressive regional exploration
program, which if successful, could significantly expand the San
Albino mining operation.
To align management with shareholders, 42.5 million five year
options, representing just over 7% of the issued and outstanding
shares of Mako, have been granted to management and directors,
vesting over a 3-year period. The average strike price of these
options is $0.25625 per share, which
is more than 100% higher than where Mako's shares are presently
trading. The options will have four strike prices ranging
from $0.1625 to $0.35 per share.
I want to congratulate those shareholders who participated in
the rights offering, and we look forward to generating returns for
all shareholders."
On behalf of the Board,
"Akiba Leisman"
CEO
About Mako
Mako Mining Corp. is a publicly listed gold mining, development
and exploration firm. The Company is developing its high-grade San
Albino gold project in Nueva
Segovia, Nicaragua. Mako's
primary objective is to bring San Albino into production quickly
and efficiently, while continuing exploration of prospective
targets in Nicaragua.
Forward-Looking Information: Some of the
statements contained herein may be considered "forward-looking
information" within the meaning of applicable securities
laws. Forward-looking information is based on certain
expectations and assumptions, including that the Company's
exploration programs will be successfully completed; that although
the Company's production decision at its San Albino project is not
based on a technical study supporting mineral reserves, and
therefore not based on demonstrated economic viability, management
currently believes the project is on track to achieve its first
gold pour by the late summer of 2020; that the Company will be
successful in its proposed financing plans necessary for the
construction at the San Albino project. Such forward-looking
information is subject to a variety of risks and uncertainties
which could cause actual events or results to differ materially
from those reflected in the forward-looking information, including,
without limitation, the risks that additional satisfactory
exploration results at the Mango zone will not be obtained; that
the PEA is preliminary in nature and there is no certainty that the
PEA will be realized; the risk of economic and/or technical failure
at the San Albino project associated with basing a production
decision on the PEA without demonstrated economic and technical
viability; that exploration results will not translate into the
discovery of an economically viable deposit; risks and
uncertainties relating to political risks involving the Company's
exploration and development of mineral properties interests; the
inherent uncertainty of cost estimates and the potential for
unexpected costs and expense; commodity price fluctuations, the
inability or failure to obtain adequate financing on a timely basis
and other risks and uncertainties. Such information contained
herein represents management's best judgment as of the date hereof,
based on information currently available and is included for the
purposes of providing investors with the Company's plans and
expectations at its San Albino project and the Las Conchitas area,
and may not be appropriate for other purposes. Mako does not
undertake to update any forward-looking information, except in
accordance with applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Mako Mining Corp.
