TORONTO, Sept. 28, 2017 /PRNewswire/ – Sierra Metals Inc. (TSX: SMT) (BVL: SMT) (NYSE AMERICAN: SMTS) (“Sierra Metals” or “the Company”) is pleased to announce the signing of a Memorandum of Understanding (“MOU”) with Jinchuan Group Co Ltd (“Jinchuan”). The MOU, executed September 26, 2017, formalizes the intentions of the parties in respect of their cooperation focused on the Jinchuan’s Bahuerachi copper mining project’s development in Chihuahua, Mexico.
Jinchuan acquired the Bahuerachi copper porphyry deposit in connection with its acquisition of Tyler Resources Inc. in 2008 and has conducted multiple geologic and engineering studies with an aim to developing a large scale open pit copper mine. The Bahuerachi project concessions are adjacent to Sierra Metals’ Bolivar copper mine concessions. The Bolivar mine started commercial production in 2012 and has successfully expanded its copper production levels over the past five years and more recently conducted a more aggressive exploration program with the objective to increase its resource tonnage and copper ore grades.
The MOU has the objective of accelerating the cooperation between Jinchuan and Sierra Metals at the Bahuerachi mining concessions in a manner that is value enhancing and mutually beneficial to both companies and capitalizes on Sierra Metals’ success in operating in Latin America and particularly in the Bahuerachi region. The MOU is a non-binding agreement that both parties will negotiate in good faith to evolve into a specific comprehensive cooperation agreement to govern their relationship.