Quaterra Resources Inc. today announced that it has entered into an agreement to sell its 50% interest in the Nieves silver property in Zacatecas State, Mexico, to joint-venture partner Blackberry Ventures I, LLC, for US$4 million.
Under the terms of the agreement, Quaterra will receive four payments over 15 months of US$1.0 million each, with each payment earning Blackberry an additional 12.5% interest in the project. All costs for maintaining and exploring the property will be the sole responsibility of Blackberry, with no dilution to Quaterra, through the end of 2015 or until Blackberry completes the acquisition, whichever is earlier. Upon closing, Blackberry will become the operator of the Nieves project. In the event that Blackberry subsequently sells the project, Quaterra will receive 5% of the future net sale price. In addition, Quaterra has agreed to transfer its Americas claims in Durango State, Mexico, adjacent to Hecla Mining's San Sebastian project, into the joint venture.
"In this current environment of scarce capital and depressed metal prices management believes it is better to sell Nieves and have the money available to support our efforts in the Yerington copper district, which remains the core focus of Quaterra's activities," says Quaterra President and CEO Steven Dischler. "It's about choices and putting the Company in the best position to succeed."
"Over the past two years, the Company has been evaluating various alternatives for the Nieves Project, including outright sale or putting the project on care and maintenance until market conditions improve," says Quaterra Chairman Thomas Patton. "In this light monetizing the Nieves asset at this time seems like the best alternative for Quaterra's shareholders."
Quaterra retains an upside in the Nieves project. Should further exploration and development of the Nieves project by Blackberry result in a sale of the project in the future, Quaterra will receive 5% of the proceeds of the future net sales price.