Canada’s Tethyan Resource Corp. (TSXV: TETH) announced that it is working towards acquiring the past-producing Kizevak and Sastavci silver-zinc-lead mines in southwestern Serbia.
In a press release, the Vancouver-based miner said that to go ahead with the purchase, it has entered into an arm’s length agreement to purchase a 100% ownership stake in Serbian company EFPP d.o.o., the holder of two exploration licences over the mines.
In 1994, the Yugoslav Geological Survey reported combined estimated mineral resources in GKZ compliant A+B+C1+C2 categories of 8Mt at 45 g/t silver, 5.06 % zinc and 2.96 % lead at Kizevak, Sastavci and Karadak
The acquisition of EFPP will occur in two steps, an initial ‘first closing’ whereby Tethyan will acquire 10% of the shares of EFPP and management control of the company for a cash payment of EUR 625,000; and a ‘second closing,’ which could take place in the 12-month period following the ‘first closing’ when Tethyan has the right to acquire the remaining 90% of the shares of EFPP by paying EUR 1,375,000, granting the sellers a 2% Net Smelter Return over the licences; issuing four million ordinary shares of Tethyan in different instalments; and paying a deferred cash payment of EUR 500,000 on the two-year anniversary of the first closing.
“This acquisition is a key step in Tethyan’s strategy to consolidate a district of historical mines and exploration prospects in Serbia,” Fabian Baker, the firm’s president and CEO, said in the media brief. “The Kizevak project, in particular, gives Tethyan an immediate drill-ready target, and we can now drill the 1.2 kilometres of strike length, reported hosting historical resources, between the former open-pit mine and Tethyan’s excellent 2018 drilling results.”
Kizevak is a past-producing mine reported to host considerable historic mineral resources, along-strike from which Tethyan drilled mineralization including 12 metres at 22.03% zinc, 10.29 % lead, 167 g/t silver and 0.18 g/t gold. The mine was operated as an open pit by the Serbian state between 1984 and 2000, ceasing operations due to conflict in the region.
Sastavci was also mined historically as an open pit on a smaller scale than at Kizevak and represents a priority drilling target. Outcropping, steeply dipping, massive sulphide veins up to five metres wide are visible in the pit walls. Tethyan said that its team collected 65 rock-chip samples across the Sastavci area, which returned assays ranging from trace to >30 % zinc, 7.1 % lead, 94.3 g/t silver and 0.47 g/t gold.