Medellin - Orosur Mining Inc. ('Orosur' or 'the Company') (TSX/AIM: OMI), a South American-focused gold developer and explorer announces the results for the second quarter ended November 30, 2019 ('Q2 20' or the 'Quarter').
HIGHLIGHTS
In accordance with the Exploration Agreement with Venture Option (the 'Exploration Agreement'), Newmont Colombia made a further cash payment of US$690k to Minera Anza in November 2019 to cover its outstanding commitments and to maintain its Phase 1 earn-in rights.
In Uruguay, as announced on September 17, 2019, the Court approved the payment plan agreement between the Company's wholly owned subsidiary, Loryser SA ('Loryser') and Loryser's creditors (the 'Creditors' Agreement'). The ratification by the Court means that the Creditors' Agreement is legally binding on all trade creditors and that the intervenor's control over Loryser ceases.
The Creditors' Agreement provides that the net proceeds from the sale of Loryser's assets in Uruguay, together with the issuance of 10 million common shares in Orosur, shall fully satisfy all amounts owing by Loryser to its trade creditors, as well as provide funds for Loryser to conduct this process and manage the orderly closure of its operations. The Creditors' Agreement requires Loryser to manage and complete the sale and payment process within two years, starting from the date of the ratification by the Court.
As announced on December 6, 2019, 10,000,000 common shares were issued to a trust for the benefit of Loryser's creditors in accordance with the court-approved agreement.
The non-binding letter of intent signed in November 2019 with IMC International Mining Corp. expired on December, 27, 2019 without completing a definitive agreement. Loryser remains in discussions with IMC as well as considering alternative options with other potential partners to sell its mining and exploration permits in Uruguay.
The Company had a cash balance of US$809k at November 30, 2019 (May 31, 2019: US$512k).
Assets held for sale in Uruguay have been recorded in this quarter and in the FY19 consolidated financial statements at the lower of book value or fair value. The consolidated financial statements were prepared on a going concern basis under the historical cost method except for certain financial assets and liabilities which are accounted as Assets and Liabilities held for sale and Profit and Loss from discontinuing operations: this accounting treatment has been applied to the activities in Uruguay and Chile.
Outlook and Strategy
During the year ended May 31, 2018, the Board adopted an aggressive strategic plan to restructure its business, and recapitalize and transform the Company. The Company's main objectives were advancing the Anza Project: the Company's flagship, high grade gold exploration asset in Colombia; finding a fair solution in Uruguay for all stakeholders and reducing its activities in Chile. This strategy remains unchanged.
In Colombia, Newmont Colombia has fulfilled its Year 1 commitments and payments under the requirements of the Exploration Agreement.
In Uruguay, with the Creditors Agreement approved by the Court in September 2019, Loryser continued to focus its activities on the implementation of the Creditors Agreement. The plant and equipment remain under care and maintenance. The successful sale of assets is a key component to a positive outcome with creditors. The Company has already issued the 10,000,000 common shares in Orosur, subject to a four-month holding period, to the benefit of Loryser's creditors.
About Orosur Mining Inc.
Orosur Mining Inc. (TSX: OMI; AIM: OMI) is a precious metals developer and explorer focused on identifying and advancing gold projects in South America. The Company operates in Colombia and Uruguay.
Forward Looking Statements
All statements, other than statements of historical fact, contained in this news release constitute 'forward looking statements' within the meaning of applicable securities laws, including but not limited to the 'safe harbour' provisions of the United States Private Securities Litigation Reform Act of 1995 and are based on expectations estimates and projections as of the date of this news release.
Forward-looking statements include, without limitation, the exploration plans in Colombia and the funding from Newmont of those plans, Newmont's decision to continue with the Exploration and Option agreement, the ability for Loryser to continue and finalize with the remediation in Uruguay, the ability to implement the Creditors' Agreement successfully as well as continuation of the business of the Company as a going concern and other events or conditions that may occur in the future. The Company's continuance as a going concern is dependent upon its ability to obtain adequate financing, to reach profitable levels of operations and to reach a satisfactory implementation of the Creditor's Agreement in Uruguay. These material uncertainties may cast significant doubt upon the Company's ability to realize its assets and discharge its liabilities in the normal course of business and accordingly the appropriateness of the use of accounting principles applicable to a going concern. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such forward looking statements. Such statements are subject to significant risks and uncertainties including, but not limited, those as described in Section 'Risks Factors' of the MDA and the Annual Information Form. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events and such forward-looking statements, except to the extent required by applicable law.
Contact:
Tel: +1 (778) 373-0100
OROSUR MINING INC. 
