VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 09/27/12 -- Alexco Resource Corp. (TSX: AXR)(NYSE MKT: AXU) today announces it has completed the sale of its remaining interest in the Brewery Creek property, located in the Yukon.
In August, 2009, Alexco entered into an option agreement with Golden Predator Corp. (TSX: GPD) under which Golden Predator could earn up to a 75% interest in the Brewery Creek property. Golden Predator completed the work commitment to earn an initial 51% interest in Brewery Creek, and has been continuing work programs to complete its remaining earn-in under the option. Pursuant to a purchase agreement entered into in February 2012, Alexco has now completed the sale to Golden Predator of all of Alexco's remaining interest in Brewery Creek.
In exchange for providing Golden Predator with a 100% interest in Brewery Creek, Alexco has now received $4,000,000 cash (comprised of $3,205,000 received from Golden Predator, plus $795,000 received through the release of reclamation security) as well as 7,500,000 common shares of Golden Predator, and warrants to acquire an additional 3,750,000 common shares of Golden Predator at any time in the next two years at a price of $1.15 per share. Alexco has also been granted a net smelter returns royalty of 2% on the first 600,000 ounces of gold produced from Brewery Creek, increasing to 2.75% thereafter. Golden Predator has the right to repurchase 0.625% of the increased royalty from Alexco at any time for $2,000,000.
Alexco Resource Corp. owns and operates the Bellekeno silver mine, one of several mineral properties held by Alexco which encompass substantially all of the historical Keno Hill Silver District located in Canada's Yukon Territory. Bellekeno, which commenced commercial production at the beginning of calendar year 2011, is Canada's only operating primary silver mine. Alexco's primary near-term exploration objective is to unlock value in the silver-rich Keno Hill District, and is focused on growth by advancing its promising District properties to development decisions. The Company's goal is to produce 7 million to 10 million ounces of silver annually within the next decade. Employing a unique business model, Alexco also provides mine-related environmental services, remediation technologies and reclamation and mine closure services to both government and industry clients through the Alexco Environmental Group, its wholly-owned environmental services division.
Keno Hill Silver District History
Between 1921 and 1988, the Keno Hill Silver District was a world-class silver producer, with more than 217 million ounces of silver produced at average grades of 40.5 ounces per ton silver, 5.6% lead and 3.1% zinc (Yukon Government's Minfile database). These historical production grades would rank Keno Hill in the top 3% by grade of today's global silver producers.
Please visit the Alexco website at www.alexcoresource.com.
Some statements ("forward-looking statements") in this news release contain forward-looking information concerning the Company's anticipated results and developments in the Company's operations in future periods, planned exploration and development of its properties, plans related to its business and other matters that may occur in the future, made as of the date of this news release. Forward-looking statements may include, but are not limited to, statements with respect to future remediation and reclamation activities, future mineral exploration, the estimation of mineral reserves and mineral resources, the realization of mineral reserve and mineral resource estimates, future mine construction and development activities, future mine operation and production, the timing of activities and reports, the amount of estimated revenues and expenses, the success of exploration activities, permitting time lines, requirements for additional capital and sources and uses of funds. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results and timing of exploration and development activities; actual results and timing of mining activities; actual results and timing of environmental services activities; actual results and timing of remediation and reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of silver, gold, lead, zinc and other commodities; possible variations in mineable resources, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; First Nation rights and title; continued capitalization and commercial viability; global economic conditions; competition; and delays in obtaining governmental approvals or financing or in the completion of development activities. Forward-looking statements are based on certain assumptions that management believes are reasonable at the time they are made. In making the forward-looking statements included in this news release, the Company has applied several material assumptions, including, but not limited to, the assumption that market fundamentals will result in sustained silver, gold, lead and zinc demand and prices. There can be no assurance that forward-looking statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. The Company 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 otherwise required by applicable securities legislation.