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July 6, 2016
Vancouver, British Columbia
NEWS RELEASE
Metal Mountain Resources Inc. ("MMR") regrets to announce that at this time MMR is
unable to pay dividends as earlier planned. The reasons for the delay, as well as plans
for Gavin Mines Inc ("GMI") moving forward, are explained in more detail below.
Section 4.2(a) and (b) of the Share Purchase and Shareholder's Agreement dated
November 27, 2015 between GMI, the then existing shareholder's of GMI, and Dome
Mountain Resources of Canada Inc ("DMRC"), states "if the Company does not have
the permit and drilling results specified under this Section 4.2 by June 30, 2016 this
Agreement shall be terminated except for the provisions of Sections 3.1 and Article 8 of
this Agreement which will continue in full force and effect". DMRC has purchased
14.48% of GMI's issued shares under the terms of the Shareholder's Agreement.
Section 3.1 and Article 8 set out the terms of the Shareholder's Agreement among all
the shareholders of GMI.
Notwithstanding that the drilling results "condition" of the Agreement were fulfilled by the
Company (we are awaiting the NI43-101 report from Steve Cutler of Rough Stock
Mining Services), however, GMI was not able to obtain the amended permit for the mill
and tailings management facility from the BC government by June 30, 2016.
The government ministries responsible for issuing such permits are under intense stress
and scrutiny as a result of changing regulations brought on by serious problems (i.e.
major tailings dam breaches at other mines in the Province). As a result, the
government has brought into effect higher mandatory environmental protection
requirements at the engineering and design level for all tailings management facilities to
be permitted in the Province, which has created a backlog of old and new applications
for permitting.
Notwithstanding, while the permitting climate in BC has changed significantly since the
major breaches of tailings dams in the Province, (commencing in August 2014), GMI
submitted our Amended Permit Application in February 2014 and remains confident that
by making some changes to our tailings disposal plan, amended permits will be issued
to GMI. Falkirk Resource Consultants of Vancouver have been recently engaged to help
communicate with the government of BC on sensitive issues surrounding the permit
amendments.
In the meantime, GMI has entered into negotiations with Nicola Mining Inc (Nicola) to
ship to and process ore from the Dome Mine site at Nicola's facility located
approximately 15 km outside of Merritt, BC. GMI is presently permitted to mine ore from
the Dome Mine and plans to put the Dome Mine back into Stage 1 production at a rate
of 100 tonnes per day, after addressing a few minor government requirements.
Nicola, under agreement with GMI and as a test run for a proposed future milling and
smelting agreement is currently processing 4,700 tonnes of GMI ore that was stockpiled
at Quesnel, BC. Initial indications are that recoveries are in line with our metallurgical
projections. Nicola will ship the concentrates to a smelter after GMI has reviewed and
approved the proposed smelter agreement. Nicola has expressed interest in pursuing a
longer-term contract with GMI to process ore directly from the mine at a rate of 100
tonnes per day.
For GMI's Mines Act permit amendment regarding the installation of a 250 tonne per
day mill and tailings disposal for Stage 2, GMI is required to complete an engineering
study on the feasibility of different BAT (Best Available Technology) and best
engineering study for the feasibility of acceptable tailings disposal options, before the
application for an amended permit can be updated and resubmitted.
In addition, the company will need to update the kinetic test water quality effects model
for the site and the new proposed discharge limits.
The cash flow from Stage 1 mining of the Dome Mine and the milling at the Nicola mill in
Merritt will produce cash flow that is expected to enable GMI to fund the Stage 2 permit
amendment requirements. It is also GMI's plan to continue to meet our present
obligations and to use any excess funds generated from the above activity to drill and
establish additional resources at the Dome Mine. All of the aforementioned programs
are expected to increase the value of the Dome Mine.
Lloyd Tattersall
For further information please contact:
Curtis Brazeau: 778-846-4907
Abel Tattersall: 778-878-4906
FORWARD LOOKING STATEMENTS:
The information contained in this website is provided solely for the reader's general knowledge. The information is not intended to be a comprehensive review of all matters and developments concerning Metal Mountain Resources Inc. All information is offered on a "best intentions" basis. No securities commission or other regulatory authority in Canada or any other country or jurisdiction has in any way passed upon this information and no representation or warranty is made by the Company to that effect.
This website includes "forward looking statements". Other than statements of historical fact, all statements included in this document, including without limitation, statements regarding exploration results, future plans and objectives of the Company may be forward looking statements. These statements may reflect management's current beliefs and are based on information currently available to management. Forward looking statements involve significant risks and uncertainties. A number of factors could cause actual results to differ materially from the results discussed in the forward looking statements, including, but not limited to, general economic conditions, changes arising as drilling results unfold, changes in regulatory environments affecting the Company and the availability and terms of subsequent financings. Although the forward looking statements included in this document are based upon what management believes to be reasonable assumptions, there can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
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