SSR Mining has agreed to divest its Pitarrilla project in Durango, Mexico, to Canadian precious metals mining company Endeavour Silver for up to $127m.
According to the agreement, Canada-based SSR Mining will receive $35m in cash from Endeavour, along with $35m in Endeavour Silver shares.
SSR Mining will retain a 1.25% net smelter return royalty on the Pitarrilla property, which is said to be one of the world’s largest undeveloped silver projects.
Furthermore, Endeavour Silver will incur exploration expenditures of at least $10m on the Pitarrilla project, over a five-year period from the closing of the deal.
Upon completion of the transaction, SSR Mining will have 5% of the outstanding shares of Endeavour Silver.
Endeavour CEO Dan Dickson said that the acquisition of the project will accelerate the firm’s vision to become a premier senior silver producer.
Dickson commented: “While Terronera is the next project to be developed, we anticipate that Pitarrilla will be a significant asset in our portfolio and may take priority over the advancement of Parral.
“We will be in a position to make such a decision once we complete further drilling and analyse the economics of various scales and options for production.”
Located 160km north of Durango City in northern Mexico, the 4,950ha Pitarrilla silver, lead, and zinc project comprises five concessions.
The deal is pending regulatory clearance, as well as approval of the Mexican Federal Economic Competition Commission.
This sale is in line with SSR Mining’s plan to monetise non-core assets to realise value for shareholders.
Over the past seven months, SSR has raised more than $235m in aggregate consideration through the sale of its non-core royalty portfolio.
In December 2021, SSR Mining reached a $21m deal to buy Canada’s Taiga Gold.