January 27, 2016, Vancouver, B.C. - Bear Creek Mining Corporation (TSX Venture: BCM) (“Bear Creek” or the “Company”) is pleased to provide shareholders with an update on its activities regarding the Santa Ana and Corani projects in Peru, and an outlook for 2016.
“2015 was a productive year for Bear Creek, with the completion of the Corani Optimized Final Feasibility Study* and the submission of our initial statement of claim (the “Memorial”) in respect of the Santa Ana project arbitration,” states Andrew Swarthout, President and CEO. “Corani is one of the largest undeveloped silver projects in the world, and coupled with our Santa Ana deposit, forms the basis of Bear Creek’s future growth profile. We recognize that during this sustained downturn in mining markets and metal prices our treasury is a key asset and a factor that separates us from many other exploration and development companies. Our goal for 2016 is simple; to continue to meaningfully move the Corani project forward and work to unlock the value at Santa Ana while operating in as cost-effective a manner as possible so that our treasury continues to buffer us from the worst of the mining downturn. Ultimately, our aim is to weather this mining market slump and emerge from it in a ‘front-row’ position, able to accelerate quickly and decisively when the markets improve.”
The Santa Ana arbitration, being heard at the International Centre for Settlement of Investment Disputes (“ICSID”), is proceeding on schedule. Bear Creek’s Memorial was filed on May 29, 2015, which was followed by the Government of Peru’s Counter-Memorial filing on October 6, 2015. Bear Creek submitted its reply to Peru’s Counter-Memorial in early January, 2016. Peru’s rejoinder to this filing is due to be submitted to ICSID in mid-April and a final submission from Bear Creek will be filed in late May, 2016. ICSID is posting these written submissions on their website, generally within several weeks of their filing, at https://icsid.worldbank.org/apps/ICSIDWEB/cases/Pages/casedetail.aspx?CaseNo=ARB/14/21&tab=DOC. In-person hearings before the arbitration tribunal are scheduled to occur at ICSID headquarters from September 8 to 16, 2016, after which the tribunal will commence its deliberations. An award on Bear Creek’s case is anticipated within the second half of 2017, though there is no prescribed deadline for the tribunal’s ruling. Bear Creek and its legal counsel remain very confident in the merits of its claim that the Santa Ana project was expropriated without compensation in June 2011 through the Government of Peru’s issuance of Supreme Decree 032, which nullified the Company’s rights to advance the Santa Ana project.
After completing the Corani Optimized Final Feasibility Study last year, Bear Creek undertook an exploratory investigation of possible Corani project-financing scenarios. Feedback from a range of potential participants, including lenders, off-take partners, development banks, equity markets, and streaming partners, aligned closely with the Company’s internal conclusions; Corani, as one of the largest, and longest-life-span, undeveloped silver deposits in the world, is a financeable and buildable operation but will require significant upfront capital access and improved metal and share prices to justify a development decision. Therefore, our plans for Corani during the coming months are to continue to de-risk the project by acquiring key permits in preparation for an application for the Construction Permit that is ultimately required to commence development, while maintaining the excellent community relationships we have worked hard to foster. The Company’s goal is to ensure the necessary components are in place to make sound and nimble decisions for Corani when the opportunity arises. To this end, in late 2015 Bear Creek submitted modifications (based on the Corani Optimized Final Feasibility Study) to its Environmental and Social Impact Assessment (“ESIA”) originally approved in September 2013. In mid-January Bear Creek received approval of the modified ESIA from the Peruvian Ministry of Energy and Mines; a key milestone for the Corani project and an important component of the eventual Construction Permit.
Bear Creek has 3 prospective exploration properties in Peru under joint venture; the Sumi and La Yegua copper-gold projects and the Maria José gold-silver project. While we continue to maintain an ownership interest in these projects, they are currently being advanced at virtually no cost to the Company.
Bear Creek’s strategy for the coming months will continue to comprise both offensive and defensive elements. We will continue the Santa Ana arbitration process so that its value to shareholders can be unlocked. We will continue to meet our Corani social and environmental obligations and maintain our cooperative and respectful community partnerships while we work to secure the additional permits required for its eventual development. Our focus on longevity will be amplified in the coming months however, in order to preserve our treasury as long as possible without reversing our forward momentum. General and administrative expenses are being lowered as much as possible, staffing levels are being reduced to core functions only, and the Company is preparing to replace a significant percentage of the cash component of director and management compensation with non-cash alternatives.
On behalf of the Board of Directors,
President and CEO
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
National Instrument 43-101 (“NI 43-101”) Disclosure
All of Bear Creek’s exploration programs and pertinent disclosure of a technical or scientific nature are prepared by or prepared under the direct supervision of Andrew Swarthout, P.Geo., President and CEO, a Qualified Person (“QP”) as defined in NI 43-101.
The 2015 Corani Optimized Final Feasibility Study Technical Report, filed on July 20, 2015, was prepared by a team of independent engineering consultants as described in the Company’s news release of June 2, 2015.
Caution Regarding Forward Looking Statements
This news release contains “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as “forward-looking statements” are made as of the date of this news release or as of the effective date of information described in this news release, as applicable. Forward-looking statements relate to future events or future performance and reflect current estimates, predictions, expectations or beliefs regarding future events. Any statements that relate to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact and may be forward-looking statements. All forward-looking statements made herein and in the documents referred to herein, are based on the Company’s or its consultants’ beliefs at the time the statements were made, as well as various assumptions made by and information currently available to them. Although management considers these assumptions to be reasonable based on information available to it, they may prove to be incorrect.
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates, assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates used to make such forward-looking statements do not occur and the additional risks described in the Company’s Annual Information Form for the year ended December 31, 2013, annual financial statements and management’s discussion and analysis for the year ended December 31, 2014 and in the feasibility study entitled “Optimized and Final Feasibility Study, Corani Project, Puno, Peru, Form 43-101F1 Technical Report” filed on July 20, 2015. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by the Company or on behalf of the Company, except as required by law.