Press release from Marketwire
South American Silver Files Second Quarter 2013 Financial Statements and MD&A
Thursday, August 08, 2013
South American Silver Files Second Quarter 2013 Financial Statements and MD&A20:13 EDT Thursday, August 08, 2013
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug. 8, 2013) - South American Silver Corp. (TSX:SAC)(OTCQX:SOHAF) reports the release of its unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2013 and the related management's discussion and analysis of financial position and results of operations ("MD&A"). All amounts in this news release are expressed in U.S. dollars, unless otherwise indicated.
As at June 30, 2013, the Company had a working capital of $14.2 million including cash and cash equivalents of $14.6 million. As at the date of this news release the Company also owns an 18.5% equity interest in High Desert Gold Corporation (TSX VENTURE:HDG)(OTCQX:HDGCF) which had a quoted value as at June 30, 2013 of Cdn. $1.5 million.
At the Escalones copper-gold project in Chile, drilling for the season that started in November 2012 ended on May 2, 2013 with a total of 9,070 metres of drilling completed. On June 28, 2013, the Company announced an updated NI 43-101-qualified resource estimate for Escalones showing a significant increase in copper, molybdenum and gold resources from the previous estimate as well as a category upgrade of approximately a third of the resource to Indicated from Inferred (See News Release 13-13 dated June 28, 2013). The total exploration costs for the season amounted to $7.6 million of which $6.3 million were incurred during the first half of 2013. Effective June 27, 2013 the Company extended for 5 years the terms of its Option Agreement to acquire the remaining portion of the Escalones property, resulting in a $2.4 million cash savings for the Company in the current year.
With regards to Malku Khota, the Company's wholly-owned subsidiary, South American Silver Limited, commenced international arbitration against the Government of Bolivia on April 30, 2013. South American Silver is seeking compensation based on fair market value of the Malku Khota project under the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL) pursuant to the Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Republic of Bolivia for the Promotion and Protection of Investments (UK-Bolivia Treaty). Bolivia and South American Silver agreed to designate the Permanent Court of Arbitration as the appointing and administering authority in the arbitration. An arbitral tribunal is being empanelled by the parties. Thereafter, the tribunal will set a provisional timetable for the arbitration itself. This will include a schedule for submission of a Statement of Claim, Statement of Defense and oral hearings at a court of arbitration to be designated. Unless there is a negotiated settlement of the dispute, it is expected that the arbitration can take up to 2-3 years from commencement of proceedings until rendering of a final award.
On May 23, 2013 the Company entered into an agreement with a third party funder (the "Funder") pursuant to which the Funder will cover, on a non-recourse basis, South American Silver's future costs and expenses related to its international arbitration proceedings against Bolivia, including those incurred in connection to the enforcement of any arbitral award (See News Release 13-12 dated May 24, 2013).
The immediate priorities of the Company for 2013 remain to (i) diligently manage and preserve the Company's cash resources; (ii) evaluate the potential of joint venturing future stages of Escalones; (iii) recover fair market value for the Malku Khota project by pursuing international arbitration proceedings against Bolivia at the same time remaining open to a negotiated settlement; (iv) evaluate the potential for acquiring new attractive exploration targets through strategic mergers and acquisitions; and (v) rebrand the Company to reflect its new strategic direction.
Further details including copies of the unaudited financial statements and related MD&A can be found on SEDAR at www.sedar.com and on the Company's website at www.soamsilver.com.
About South American Silver Corp.
South American Silver Corp. is a growth focused mineral exploration company creating value through the exploration and development of the large scale Escalones copper-gold project in Chile, the pursuit of new opportunities, and the realization of value from the Malku Khota project in Bolivia. South American Silver Limited is a company incorporated in the Bermuda Islands, an overseas territory of the United Kingdom, which through its wholly owned Bahaman subsidiaries: Malku Khota Ltd, G.M. Campana Ltd. and Productora Limited., owns one hundred per cent of the outstanding shares of Compañía Minera Malku Khota S.A., a Bolivian company, holder of the Malku-Khota mining concessions until their nationalization by the Bolivian Government. The Company's approach to business combines the team's track record of discovery and advancement of large projects, key operational and process expertise, and a focus on community relations and sustainable development. Management has extensive experience in the global exploration and mining industry. The Company's shares are listed on the Toronto Stock Exchange under the symbol "SAC" and on the OTCQX as "SOHAF". Information related to South American Silver Corp. is available at www.soamsilver.com and on SEDAR at www.sedar.com.
Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "will", "new", "potential", "future", "expected", "creating", "realization" and "pursuing" and similar expressions. This News Release contains forward-looking statements. These forward-looking statements are based on current expectations and various estimates, factors and assumptions and involve known and unknown risks, uncertainties and other factors.
Readers are cautioned not to place undue reliance on these statements as the Company's actual results, performance or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore, the Company cannot provide any assurance that forward-looking statements will materialize. Factors that could cause results or events to differ materially from current expectations expressed or implied by the forward-looking statements, include, but are not limited to, the political and economic climate in Bolivia including the attitudes and actions of the Bolivian government related to foreign investment in Bolivia; the international arbitration process; and risks of the mineral exploration industry which may affect the advancement of the Escalones project, including possible variations in mineral resources or grade, metal prices, availability of sufficient financing to fund further required work in a timely manner and on acceptable terms, timely receipt of required permits, availability of equipment and qualified personnel, failure of equipment or processes to operate as anticipated, road access to the property, changes in project parameters as plans continue to be refined; and other risks more fully described in the Company's Annual Information Form filed and publicly available on SEDAR at www.sedar.com. The assumptions made in developing the forward-looking statements include: the ability of the Company to realize value from its investments in Bolivia, the arbitration proceeding along a timeline consistent with other international arbitrations, the Funder honouring its contractual commitments, the accuracy of current resource estimates and the interpretation of drill, metallurgical testing and other exploration results; the timely receipt of required permits for Escalones; the availability of equipment and qualified personnel to advance the Escalones project; execution of the Company's existing plans and further exploration and development programs for Escalones, which may change due to changes in the views of the Company or if new information arises which makes it prudent to change such plans or programs; and the availability of new attractive exploration targets at a cost acceptable to the Company.
Subject to applicable laws, the Company assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason. Unless otherwise indicated, forward-looking statements in this News Release describe the Company's expectations as of August 8, 2013.
FOR FURTHER INFORMATION PLEASE CONTACT:
South American Silver Corp.
President & CEO
604.681.6926 or Toll Free 1-855-681-6926
South American Silver Corp.