TVI Pacific Arranges Loan to Joint Venture Partner and Amends Earn-In Terms
TSX: TVI OTCQX: TVIPF
CALGARY, June 24, 2013 /CNW/ – TVI Pacific Inc. (TSX:TVI) (OTCQX:TVIPF) (“TVI” or the “Company”) announced today it has agreed to loan,
pursuant to a secured promissory note, up to CAD $1.3 million to joint
venture partner Mindoro Resources Ltd. (TSXv: MIO; ASX: MDO)
(“Mindoro”). The loan will be used by Mindoro to help fund its
operations for the next twelve months and to finance an initial
acquisition payment to Minimax Mineral Exploration Corporation
(“Minimax”) for Mindoro to acquire the remaining 25% interest in the
Agata project. Mindoro currently holds a 75% interest in the Agata
project and is negotiating an option to acquire the additional 25% from
its partner Minimax. Minimax is a private Philippine company based in
Makati City, Philippines that provides mineral and precious metal
exploration and mining services.
TVI and Mindoro Resources have signed four joint venture agreements,
previously announced on October 1, 2012, relating to the Agata and Pan
de Azucar mining projects located in the Philippines on the Islands of
Mindanao and Panay, respectively. The joint ventures present TVI with
multiple growth opportunities for near-term and medium-term cash flow
generating potential. Under the agreements TVIRD, TVI’s Philippine
affiliate, has the opportunity to earn up to a 60% interest and will
act as operator of the projects. The balance of the interest is held
by Mindoro and Minimax, from whom Mindoro is negotiating to acquire the
additional interest that would increase Mindoro’s share to 40% in the
Agata high iron laterite direct shipping operation (DSO), limestone DSO
operation, and Agata processing operation.
As previously disclosed in February 2013, the Agata Nickel Project is
being advanced under the following two stage development objective:
-- Stage 1: Undertake a feasibility study and permitting for a DSO project, leading, subject to economic viability, to commencing a DSO operation in late 2013. -- Stage 2: Advance preferred processing technology to pilot testing, followed by a definitive feasibility study by the end of 2013. As previously disclosed on June 6, 2013, TVI has commenced pilot-plant testing which will further define the technological parameters to be used in producing a Bankable Feasibility Study.
Terms of the Promissory Note
TVI may advance up to CAD $1.3 million to Mindoro pursuant to an agreed
upon schedule of monthly draws. Funds will be repayable within twelve
months of the first draw down or may be repaid earlier, together with
interest and without penalty. Interest will be calculated at a minimum
of 15% per annum. The promissory note is secured by shares in
Mindoro’s wholly owned subsidiary, MRL Nickel Philippines Inc.
Joint Venture Amendments
TVI and Mindoro have also agreed to amend the following terms of the
original joint venture agreements (full terms of the original joint
venture agreements are available in the Company’s July 6 and October 1,
2012 press releases):
-- TVI's contributions to the Agata Mining Joint Venture and Agata Processing Joint Venture will be for shares in the applicable joint venture, rather than as paid in capital, with such shares to be issued as earned and placed in escrow until TVI's full 60% interest is earned. TVI will not retain any interest in the Agata Mining Joint Venture if it withdraws prior to commencing a DSO operation and will not retain any interest in the Agata Processing Joint Venture if it withdraws prior to completing a Definitive Feasibility Study. -- TVI's minimum spending commitments pursuant to the Pan de Azucar Joint Venture agreements are extended by one year, from December 31, 2013, to December 31, 2014.
“This transaction demonstrates the confidence and continued support TVI
has for our joint venture partner Mindoro Resources,” said Cliff James,
Chairman and CEO of TVI Pacific Inc. “Providing Mindoro with the
resources to secure a 100% interest in Agata will provide us the
ability to maximize the potential value of the project that our
operations team has been advancing since the formation of our joint
About TVI Pacific Inc.
TVI Pacific Inc. is a publicly-traded Canadian company that is focused
on the production, development, exploration and acquisition of resource
projects in the Philippines and Southeast Asia. TVI produces copper and
zinc concentrates from its Canatuan mine. TVI is a partner/operator in
several joint venture projects in the Philippines and Papua New Guinea
and also has an interest in an offshore Philippine oil property.
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
Forward-Looking Statements: This news release contains certain
forward-looking information (referred to herein as “forward-looking statements“) within the meaning of applicable Canadian securities laws.
Forward-looking statements are often, but not always, identified by the
use of words such as “anticipate”, “plan”, “intend”, “estimate”,
“scheduled”, “expect”, “may”, “will”, “should”, or similar words
suggesting future activities or outcomes. Forward-looking statements
are subject to certain risks and uncertainties that could cause actual
events or outcomes to differ materially from those anticipated or
implied by such forward-looking statements. Accordingly, readers should
not place undue reliance upon the forward-looking statements contained
in this news release and such forward-looking statements should not be
interpreted or regarded as guarantees of future outcomes. The
forward-looking statements contained in this news release are made as
of the date hereof and TVI does not undertake any obligation to update
publicly or to revise any of the included forward-looking statements,
except as required by applicable Canadian securities law. The
forward-looking statements contained herein are expressly qualified by
this cautionary statement.
SOURCE TVI Pacific Inc.