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- Thomson Resources (TMZ) has signed a binding term sheet with Silver Mines (SVL) to acquire 100 per cent interest in the Webbs and Conrad silver projects
- Both projects lie within the New England Fold belt in NSW and are historical silver production sources
- To gain the 100 per cent, Thomson will pay a combination of cash and shares and upon completion, Silver Mines’ Managing Director will join TMZ’s board
- Thomson has also received binding commitments to raise $6 million via a share placement
- All up, 96.7 million shares will be issued to institutional and sophisticated investors at 6.2 cents
- The company will use the funds to continue exploration over its existing projects as well as the Webbs and Conrad projects
- Thomson has ended the day a healthy 31.6 per cent in the green with shares trading for 10 cents each
Thomson Resources (TMZ) has signed a binding term sheet with Silver Mines (SVL) to acquire 100 per cent interest in the Webbs and Conrad silver projects.
Both projects lie within the New England Fold belt in NSW and have been subject to historical silver production.
“The Webbs and Conrad projects represent high-quality assets that have been a lesser focus for Silver Mines given our primary focus has been on developing the Bowdens Silver Project,” Silver Mines Managing Director Anthony McClure said.
“The concentrated effort which Thomson will be able to afford these highly prospective assets will be particularly interesting and it is a great outcome for Silver Mines to be able to maintain exposure to these assets,” he added.
Webbs Silver Project
The Webbs Silver Project lies roughly 65 kilometres northeast of Inverell in NSW and has a JORC 2004 code resource base containing 1.5 million tonnes at 345g/t silver equivalent.
The majority of the tenement is largely underexplored and there are several down-plunge extensions that require drill testing.
Silver was discovered in 1884, and from 1884 to 1901, roughly 55,000 tonnes of ore were mined at a 23 ounce-per-tonne (equivalent to 652g/t) average silver grade.
After acquiring the project in 2006, Silver Mines undertook aggressive drilling campaigns which saw 314 holes drilled for 30,000 metres.
Conrad Silver Project
The Conrad Silver Project lies approximately 25 kilometres south of Inverell in NSW and has a JORC 2004 code resource base containing 2.65 million tonnes at 206g/t silver equivalent.
Historically, the Conrad Mine was one of the largest silver producers in the New England region with around 3.5 million ounces of silver production recorded.
On average it produced 600g/t silver, 8 per cent lead, 4 per cent zinc, 1.5 per cent copper, and 1.5 per cent tin.
Work began in 1891 and ended in 1912 due to industrial relations problems. Mining restarted in 1947 when Brocken Hill South acquired the project.
“Entering the binding terms sheet to acquire both Webbs and Conrad is game changing for Thomson and marks transformational step for the company,” Executive Chairman David Williams said.
“With these acquisitions, Thomson has added an additional layer of diversification to its existing high-quality exploration portfolio and with a focused effort Thomson will be able to quickly move into becoming a silver producer,” he added.
Transaction details
To acquire the 100 per cent interest, Thomson will first pay a non-refundable payment of $50,000 within five business days of signing the term sheet.
It will then pay an equivalent to the cash bonds in place, which are currently valued at $269,000.
Thomson will issue 75 million shares on completion, which will be escrowed for 12 months from issue.
Finally, 50 million options will be issued with an exercise price of 12.4 cents and expire three years from issue.
On completion, Thomson will appoint Silver Mines Managing Director Anthony McClure to its board.
Placement
Thomson has also received binding commitments to raise $6 million via a share placement.
All up, 96.7 million shares will be issued to institutional and sophisticated investors at 6.2 cents.
The company will use the funds to continue exploration over its existing projects as well as the Webbs and Conrad projects.
Thomson has ended the day a healthy 31.6 per cent in the green with shares trading for 10 cents each in a $13.73 million market cap.
