TINY, ONTARIO--(Marketwired - April 13, 2015) - Milner Consolidated Silver Mines Ltd. (the "Company" or "Milner") (News - Market indicators), through its wholly-owned Mexican subsidiary (Minera Milner S.A. de C.V.), has applied to the "Direccion de Concesiones y Asignaciones Mineras" to have the title to its San Lucas Concession cancelled.
Because of recent tax increases based on the length of time the concession has been held by Minera Milner and the more costly assessment work requirements, the cost of maintaining the concession in good standing has increased very substantially.
In order for Milner to proceed to the diamond drilling phase on the concession, substantial equity financing would be required to finance a costly drilling program. In light of the current unfavourable equity market conditions, Milner has not been able to raise the required funds.
At present, Milner's cash position is sufficient to fund the Company's corporate expenses but is not sufficient to also cover the ever-increasing cost of maintaining the San Lucas concession.
The difficult decision to cancel the San Lucas concession was made by a unanimous vote of all of Milner's directors. It was made in order to husband Milner's cash resources through this current period of challenging financing conditions for junior companies.
For the present, Milner will continue to actively seek other less costly mineral projects in Mexico through its wholly-owned Mexican subsidiary and will take on exploration projects of merit in Canada.
About Milner Consolidated Silver Mines Ltd.
Milner is a junior resource company, quoted for trading on the TSX Venture Exchange under the symbol MCA. The Company currently has 7,438,506 shares issued and outstanding.
Milner has $3,125,000 Canadian and foreign source tax pools. In addition, the Company has non-capital losses, in the amount of $1,203,000 Canadian, that will gradually expire, if not utilized by the year 2033.
Gowganda Area, Ontario (Silver, Cobalt)
On December 2, 2006, the Company entered into a Purchase and Sale Agreement with Consolidated Big Valley Resources Inc. The agreement envisages the potential reopening of underground silver mining operations and the recovery of silver from old tailings located on Milner's Gowganda claims and derived from past silver mining operations carried out on Milner's Gowganda claims. The agreement encompasses the following more salient terms:
The terms provide that the purchase price of the property will consist of a cash payment of Twenty-five Thousand Dollars (Cdn. $25,000) and a sliding scale royalty on silver production which will vary from 3% when the official price of silver is U.S. $15 or lower per troy ounce and increasing in stages up to a maximum of 5% when the official price of silver is greater than U.S. $30 per troy ounce.
The terms also provide for a 5% royalty payable to Milner on the sale of all and any other products produced from the property, subject to deductions for smelting and refining charges, smelter penalties and cost of transportation of the products from the concentrating facility to the smelter or refinery.
The terms further provide that starting two years from the effective date of the agreement, the Purchaser will pay to Milner a minimum royalty in the amount of Fifteen Thousand Dollars (Cdn. $15,000) per year. The minimum royalty will be paid annually regardless of whether or not any product is derived from the property provided that any amount of minimum royalty paid to Milner, which is not attributable to actual mine production in that fiscal year, shall be deducted from that portion of the production royalty payable which exceeds fifteen thousand dollars in subsequent fiscal years. In December 2014, Gold Bullion paid Milner a seventh minimum royalty payment of $15,000.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain disclosure in this release, including statements regarding the intended use of funds, constitute forward-looking information or statements (collectively, "forward-looking statements") for the purpose of applicable securities laws. In making the forward-looking statements, the Company has applied certain factors and assumptions that are based on the Company's current beliefs as well as assumptions made by and information currently available to the Company, including that the Company is able to obtain any government or other regulatory approvals required to complete the Company's planned exploration and development activities, that the Company is able to procure personnel, equipment and supplies required for its exploration and development activities in sufficient quantities and on a timely basis and that actual results of exploration activities are consistent with management's expectations. Although the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect, and the forward-looking statements in this release are subject to numerous risks, uncertainties and other factors that may cause future results to differ materially from those expressed or implied in such forward-looking statements. Such risk factors include, among others, that the Company will be unable to obtain required regulatory approvals on a timely basis or at all, that actual results of the Company's exploration activities will be different than those expected by management and that the Company will be unable to obtain or will experience delays in obtaining any required government approvals or be unable to procure required equipment and supplies in sufficient quantities and on a timely basis. Readers are cautioned not to place undue reliance on forward-looking statements. The Company does not intend, and expressly disclaims any intention or obligation to, update or revise any forward- looking statements whether as a result of new information, future events or otherwise, except as required by law.