Zacatecas Silver Corp. has completed the acquisition of the advanced-stage Esperanza Gold Project, located in Morelos State, Mexico, with Minas De Oro Nacional S.A. De C.V., a subsidiary of Alamos Gold Inc. The total consideration of the transaction is approximately $60 million with most of the payments not made until significant steps toward commercial production are achieved.

The Esperanza Gold Project is an attractive low-cost, low capital intensity, and low-technical risk growth project. Alamos has advanced the project through advanced engineering, including metallurgical work, while also focusing on stakeholder engagement including building community relations.

The initial consideration consists of $5 million in cash, 12,140,000 common shares of Zacatecas (with a value of $10 million) and a silver stream in favor of Alamos valued at $6 million.

“This is a transformational transaction for our company,” Zacatecas Chief Executive Officer Bryan Slusarchuk said. “We look forward to advancing the high-grade oxide gold deposit toward production while at the same time continuing our accelerating exploration at our silver project.”

The transaction for Esperanza is now closed and Alamos Gold will be the cornerstone shareholder of Zacatecas.

Alamos has reported a resource estimate of a measured and indicated resource of 34,352,000 metric tons (mt) at 0.98 grams (g) per mt gold and 8.09 g/mt silver for 1,084,000 ounces (oz) of gold and 8,936,000 oz of silver and inferred resource of 718,000 mt at 0.80 g/mt gold and 15.04 g/mt silver for 18,000 oz of gold and 347,000 oz of silver. Zacatecas said it has not independently verified this resource estimate and is not treating this resource estimate as a current resource.

To date, significant core and reverse circulation drilling has occurred at the Esperanza Gold Project resulting in a total of 389 drill holes for 69,716 meters (m). Four targets adjacent to or close to the historical resource were identified to expand the historical resource. The project also hosts seven regional targets that also merit drill testing.