SABINA SILVER’S BACK RIVER ACQUISITION APPROVED AT AGM
VANCOUVER – Sabina Silver Corporation (the “Company”) (SBB – TSX.V) reported today the results of the Company’s Annual General and Special Meeting of the Shareholders (“AGM”).
“I am happy to report that our shareholders voted overwhelmingly in favour of the Back River acquisition from Dundee Precious Metals,” said Tony Walsh, President & CEO “Also, we are very encouraged by the same shareholder support for the Director nominees.”
Sabina’s AGM was held today at the Metropolitan Hotel in Vancouver. At the meeting, Mr. Roy Wilkes, Mr. John Whitton, Mr. Terry Eyton, Mr. Scott Hean, Mr. Jim Morton and Mr. Tony Walsh were elected to the Board of Directors for the 2009/2010 year. KPMG LLP was appointed as the Company’s auditors, and shareholders also approved the Company’s Stock Option Plan.
In the Board Meeting following the AGM, Mr. Roy Wilkes was appointed Chairman of the Board and Mr. Jonathan Goodman, President & CEO of Dundee Precious Metals and David Fennell were appointed to the board as DPM’s nominees following the favourable results of the shareholder’s vote on the Back River acquisition.
The shareholders voted in favour of the issuance of securities (described below) for the acquisition of the Back River assets by way of special resolution on the agenda for the meeting, Over 90% of the ballots cast on the resolution were in favour of the transaction. The transaction was announced on March 30, 2009 and was the culmination of work done in 2008 to fulfill the corporate strategy to acquire accretive, synergistic precious metals assets in Canada.
The Back River Assets consist of two main components, the original Back River property hosting the George and Goose Lake gold deposits and a recent new project area, the Wishbone Project. The Back River gold deposits are proximal to Hackett River, with George Lake being approximately 40 km to the south east. The Wishbone property covers a large portion of the Hackett River Greenstone Belt and hosts Sabina’s Hackett River Project as well as other smaller base and precious metal deposits. The combined properties total approximately 3,000 square km and cover a largely unexplored highly prospective greenstone belt.
This transaction is accretive to Sabina as it:
adds 1.19 million indicated ounces of gold and 1.16 million inferred ounces of gold all in high grade deposits nearby to Sabina’s existing resource containing 200.5 million of indicated ounces of silver and 64 million inferred ounces of silver making Sabina a significant precious metals company;
allows the projects to spread cost of infrastructure over a larger higher value resource base providing synergies and economic advantages for both projects;
provides significant exploration potential to create leverage as projects advance;
creates a district exploration play in a pro-mining jurisdiction – years of exploration and potential mill feed;
positions Hackett as a future regional Mine and Mill centre – potential to incrementally increase through put through other sources in the region; and
fits with managements northern technical and permitting experience
To acquire the Back River Assets, Sabina will issue to DPM, in three tranches, upon closing, $7 million in cash and 17 million shares. Upon a decision of the Board to proceed to a Feasibility Study or production, Sabina will issue a further 5 million common shares and 2.5 million purchase warrants (tranche 2). Upon a decision of the Board to proceed to Production Sabina will issue a further 5 million common shares and 2.5 million purchase warrants (tranche 3).
The transaction is subject to the completion of relating ancillary documents and other terms and conditions and is scheduled to close on or about June 9, 2009.
The Board of Directors wish to express their appreciation to Sabina shareholders for continued support and confidence and look forward to an exciting year.
The mineral resource estimate for Hackett River has been prepared by Mr. Albert Chong, P.Geo., Senior Geologist of AMEC Americas Limited and is posted on www.sedar.com. Mr. Chong is a qualified person as defined by National Instrument 43-101. CIM Definition Standards (2005) have been used in defining the mineral resource categories.
Mineral resources for Goose Lake and George Lake were generated by RSG Global Consulting Pty Ltd (Coffey Mining) in September 2007, and are posted on www.sedar.com.Mr. John Wakeford, P.Geo. and a Qualified Person in accordance with NI 43-101 has reviewed the resources referred to above and attached and has approved their dissemination.
SABINA SILVER CORPORATION is a Canadian public mineral exploration and development company with assets at the Hackett River silver-zinc project in Nunavut and several projects in the Red Lake gold camp. The Company is well capitalized with approximately $40 million in cash and marketable securities at December 31, 2008. The strategy to grow the company focuses on two mandates: 1) to continue to focus on enormous exploration and development potential of Hackett River Silver-Zinc project; and 2) Maintain strong balance sheet to acquire accretive precious metals assets
For further information please contact:
Nicole Hoeller, Director, IR: 1 888 648-4218
Forward Looking Statements
Statements relating to the Back River Acquisition and the expected results of this transaction are forward-looking statements within the meaning of securities legislation of certain Provinces in Canada. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects,” “plans,” “anticipates,” “believes,” “intends,” “estimates,” ‘projects,” “potential” and similar expressions, or that events or conditions “will,” “would,” “may,” “could” or “should” occur. Information inferred from the interpretation of drilling results and information concerning mineral resource estimates may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. These forward-looking statements are 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 statements, including, without limitation: risks related to fluctuations in gold prices; uncertainties related to raising sufficient financing to fund the planned work in a timely manner and on acceptable terms; changes in planned work resulting from weather, logistical, technical or other factors; the possibility that results of work will not fulfill expectations and realize the perceived potential of the Company’s properties; uncertainties involved in the estimation of metal reserves and resources; the possibility that required permits may not be obtained on a timely manner or at all; the possibility that capital and operating costs may be higher than currently estimated and may preclude commercial development or render operations uneconomic; the possibility that the estimated recovery rates may not be achieved; risk of accidents, equipment breakdowns and labour disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; the risk of environmental contamination or damage resulting from Sabina’s operations and other risks and uncertainties, including those described in Sabina’s Annual Report for the year ended December 31, 2008.
Forward-looking statements are based on the beliefs, estimates and opinions of Sabina’s management on the date the statements are made. Sabina undertakes no obligation to update these forward-looking statements should management’s beliefs, estimates or opinions, or other factors, change.
This news release has been authorized by the undersigned on behalf of Sabina Silver Corporation
Tony Walsh, President and CEO
930 West 1st Street, suite 202
North Vancouver, BC V7P 3N4
Tel 1 888 648-4218 http://www.sabinasilver.com