MEXICAN MINES EXPANSION PLANS INCLUDING 20% AT
BOLIVAR AND 100% AT CUSI ARE UNAFFECTED AND STILL ON TRACK FOR
COMPLETION IN Q1 2019
TORONTO, Dec. 5, 2018 /PRNewswire/ - Sierra Metals
Inc. (TSX: SMT) (BVL: SMT) (NYSE AMERICAN: SMTS) ("Sierra
Metals" or "the Company") reports that the Company's subsidiary in
Peru (Sociedad Minera Corona,
S.A.) has received a response from SENACE (National Environmental
Certification Service) whom are the evaluator for natural resources
and production projects in Peru
with respect to its recent Environmental Impact Assessment (EIA)
Study for the expansion of the tailings deposition facility at the
Yauricocha mine.
Although the authorities did not approve the EIA study at this
time, the Company has 15 business days to provide a re-evaluation
to the authorities to initiate a review process. As it stands
today, this will result in a delay in the Company receiving an
approved EIA study, which would enable the Company to proceed with
a construction permit for the next three phases of the tailings
damn extension, and for the final submission of the ITS document,
which upon approval, would allow the Company to expand mine output
20% to 3,600 tones per day.
Sierra Metals firmly believes that all of the required
documentation was submitted, demonstrating complete fulfillment of
all the requirements for the EIA study approval. The Company will
now proceed to present a new proof of response to these
requirements.
Management are optimistic that this decision will be reviewed in
a different, and positive context as the Company's legal team
pursues the review process. This delay, in management view, may not
significantly impact the future production plans at the Yauricocha
mine operations.
The impact of this delay on a consolidated Company level,
considering all of our production expansion plans at our Mexican
and Peruvian operations, could represent up to a seven percent
temporary shortfall in Sierra Metals total daily ore production
compared to projections that would not include an EIA permit
delay.
Igor Gonzales, President and CEO
of Sierra Metals commented, "While we are disappointed, we do not
believe this decision was made with all the facts. This
decision was preliminary and not based upon or including all the
information submitted. Key members of the management team are
going to meet with authorities to provide and demonstrate full
compliance with the requirements. Management believes that
once all the correct information is reviewed, we will receive a
positive response from authorities."
He continued, "the expansion plans in Mexico to 3,600 TPD at Bolivar and to 1,200
TPD at Cusi are not affected by this decision and they are still on
track, and on budget to be completed in Q1 2019. The Company is
committed to strict compliance with regulatory permits in
Peru and Mexico in the development and organic growth
of all its operating mines. We are confident that the current
permit delay in Peru will be
resolved as we are in compliance with the permit requirements."
About Sierra Metals
Sierra Metals Inc. is Canadian based growing polymetallic mining
company with production from its Yauricocha Mine in Peru, and its Bolivar and Cusi Mines in Mexico. The Company is focused on increasing
production volume and growing mineral resources. Sierra Metals has
recently had several new key discoveries and still has many more
exciting brownfield exploration opportunities at all three Mines in
Peru and Mexico that are within close proximity to the
existing mines. Additionally, the Company also has large land
packages at all three mines with several prospective regional
targets providing longer-term exploration upside and mineral
resource growth potential.
The Company's Common Shares trade on the Bolsa de Valores de Lima and on the Toronto Stock
Exchange under the symbol "SMT" and on the NYSE American Exchange
under the symbol "SMTS".
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Forward-Looking Statements
This press release contains "forward-looking information" and
"forward-looking statements" within the meaning of Canadian and
U.S. securities laws related to the Company (collectively,
"forward-looking information"). Forward-looking information
includes, but is not limited to, statements with respect to the
Company's operations, including anticipated developments in the
Company's operations in future periods, the Company's planned
exploration activities, the adequacy of the Company's financial
resources, and other events or conditions that may occur in the
future. Statements concerning mineral reserve and resource
estimates may also be considered to constitute forward-looking
statements to the extent that they involve estimates of the
mineralization that will be encountered if and when the properties
are developed or further developed. These statements relate to
analyses and other information that are based on forecasts of
future results, estimates of amounts not yet determinable and
assumptions of management. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
"expects", "anticipates", "plans", "projects", "estimates",
"assumes", "intends", "strategy", "goals", "objectives",
"potential" or variations thereof, or stating that certain actions,
events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved, or the negative of any of these terms
and similar expressions) are not statements of historical fact and
may be forward-looking information.
Forward-looking information is subject to a variety of risks and
uncertainties, which could cause actual events or results to differ
from those reflected in the forward-looking information, including,
without limitation, risks inherent in the mining industry including
environmental hazards, industrial accidents, unusual or unexpected
geological formations, floods, labour disruptions, explosions,
cave-ins, weather conditions and criminal activity; commodity price
fluctuations; higher operating and/or capital costs; lack of
available infrastructure; the possibility that future exploration,
development or mining results will not be consistent with the
Company's expectations; risks associated with the estimation of
mineral resources and the geology, grade and continuity of mineral
deposits and the inability to replace reserves; fluctuations in the
price of commodities used in the Company's operations; risks
related to foreign operations; changes in laws or policies, foreign
taxation, delays or the inability to obtain necessary governmental
permits; risks relating to outstanding borrowings; issues regarding
title to the Company's properties; risks related to environmental
regulation; litigation risks; risks related to uninsured hazards;
the impact of competition; volatility in the price of the Company's
securities; global financial risks; inability to attract or retain
qualified employees; potential conflicts of interest; risks related
to a controlling group of shareholders; dependence on third
parties; differences in U.S. and Canadian reporting of mineral
reserves and resources; potential dilutive transactions; foreign
currency risks; risks related to business cycles; liquidity risks;
reliance on internal control systems; credit risks, including risks
related to the Company's compliance with covenants with respect to
its BCP Facility; uncertainty of production and cost estimates for
the Yauricocha Mine, the Bolivar Mine and the Cusi Mine; and other
risks identified in the Company's filings with Canadian securities
regulators and the U.S. Securities and Exchange Commission, which
filings are available at www.sedar.com and www.sec.gov,
respectively.
This list is not exhaustive of the factors that may affect any
of the Company's forward-looking information. Forward looking
information includes statements about the future and are inherently
uncertain, and the Company's actual achievements or other future
events or conditions may differ materially from those reflected in
the forward-looking information due to a variety of risks,
uncertainties and other factors. The Company's statements
containing forward-looking information are based on the beliefs,
expectations and opinions of management on the date the statements
are made, and the Company does not assume any obligation to update
forward-looking information if circumstances or management's
beliefs, expectations or opinions should change, other than as
required by applicable law. For the reasons set forth above, one
should not place undue reliance on forward-looking information.
Note Regarding Reserve and Resource Estimates
All reserve and resource estimates reported by the Company were
calculated in accordance with the Canadian National Instrument
43-101 and the Canadian Institute of Mining and Metallurgy
Classification system. These standards differ significantly from
the requirements of the U.S. Securities and Exchange Commission
("SEC"). The differences between these standards are discussed in
our SEC filings. Mineral resources which are not mineral reserves
do not have demonstrated economic viability.
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SOURCE Sierra Metals Inc.