Endeavour Silver Announces Expansion into Peru with Acquisition of Minera Kolpa, Copper Stream and Bought Deal Financing

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VANCOUVER, British Columbia, April 01, 2025 (GLOBE NEWSWIRE) -- Endeavour Silver Corp. ("Endeavour" or the "Company") (NYSE:EXK, TSX:EDR) is pleased to announce it has entered into a definitive share purchase agreement (the "Agreement") to acquire all of the outstanding shares of Compañia Minera Kolpa S.A. ("Minera Kolpa"), and its main asset, the Huachocolpa Uno Mine ("Kolpa"), from its shareholders, which are affiliates of Arias Resource Capital Management and Grupo Raffo (collectively, the "Shareholders"), in exchange for total consideration of $145 million. The total consideration will be comprised of $80 million payable in cash and $65 million payable in common shares of Endeavour ("Shares") upon closing (the "Transaction"). In addition, as part of the Transaction, Endeavour has agreed to pay up to an additional $10 million in contingent payments, payable in cash, upon the occurrence of certain events and will also add approximately $20 million in net debt which will remain outstanding and repayable by Minera Kolpa.

The cash consideration will be funded through a combination of net proceeds from a new copper purchase agreement on copper produced from Kolpa (the "Copper Stream") with Versamet Royalties Corporation ("Versamet"), a bought deal financing consisting of Shares (the "Bought Deal Financing"), and cash on hand.

Endeavour will host a conference call and webcast to discuss the Transaction at 10:00 a.m. Pacific Time today. Details are provided at the end of this news release.

Minera Kolpa is a silver-focused polymetallic mining company with operations located in the districts of Huachocolpa and Santa Ana in the province and department of Huancavelica, approximately 490 km southeast of Lima, Peru. Minera Kolpa directly or indirectly holds mining rights to 143 mining concessions and claims covering 25,177 hectares and 1 beneficiation concession covering 366 hectares. Mineralization at Kolpa occurs mainly as polymetallic epithermal deposits rich in silver (Ag), lead (Pb), zinc (Zn) and copper (Cu). Mineralized material at Kolpa is mined using underground mining methods (sublevel stoping and cut and fill), followed by an 1,800 tonnes per day ("tpd") (installed capacity) concentrator plant using a conventional selective flotation process designed to obtain a bulk concentrate with a subsequent separation of lead-silver, copper-silver and zinc concentrates. In 2024, Kolpa produced approximately 2.0 million ounces ("oz") of silver, 19,820 tonnes of lead, 12,554 tonnes of zinc and 518 tonnes of copper, approximately 5.1 million silver equivalent ounces ("AgEq oz"). In 2024, the operating cost was approximately $133 per tonne, with cash costs on a by-product basis of $12.58/oz Ag and all in sustaining costs of $22.80/oz Ag. The land package remains underexplored with only approximately 10% of the claims worked to date with multiple targets identified for future exploration by Minera Kolpa exploration geologists.

Dan Dickson, Chief Executive Officer of Endeavour, stated: "Today marks a significant milestone in Endeavour's journey to becoming a senior silver producer. The acquisition of the Kolpa mine represents a material increase to our AgEq oz production and is a testament to our team's dedication and vision and is not only about expanding our production portfolio; it's a strategic step toward shaping a stronger, more dynamic future for the company. We are excited to leverage this new venture, along with Terronera, to continue to deliver exceptional results and drive continued success for our shareholders, stakeholders and employees."

Transaction Highlights

Consistent with Endeavour's Plan to Become a Senior Silver Producer: Strategic acquisition of Endeavour's third producing mine, and first in Peru, the world's third largest silver producing jurisdiction. Kolpa is a fully funded operating primary silver asset that is expected to increase the Company's production profile by approximately five million AgEq ounces (based on 2024 production).

Track Record of Production Growth with Near-Term Expansion: Kolpa began as a small-scale <800 tpd operation and has successfully undergone numerous expansions to reach its current installed capacity of 1,800 tpd, with permitting in progress for additional expansion to 2,500 tpd.

Underground Operation that Leverages Endeavour's Technical Strengths: Providing an excellent fit with Endeavour's underground operating skill set, combining strengths and experience of key operating team members with a long-term work history at the Kolpa mine.

Exploration Upside: Consistent track record of growing resources net of depletion with numerous opportunities to further define and potentially expand recent near-mine exploration discoveries and make new discoveries on an underexplored land package.

Active Silver Mining District: Providing a platform for further potential acquisitions in a country and region with numerous mining operations and prospective geology.

Kolpa Overview

Property Location

Kolpa is located in Huachocolpa, Huancavelica Province, Peru, approximately 490 km southeast of Lima and 74 km south of Huancavelica City. Kolpa holds mining rights to 143 mining concessions and claims covering 25,177 ha, and one beneficiation concession covering 366 ha. 63 of those mining claims comprise the Administrative Economic Unit (UEA) Huachocolpa Uno. Kolpa is accessed via highway and paved road from Ayachucho, approximately 219 km east.

Geology and Mineralization

The Huachocolpa mining district is located on the eastern flank of the Western Cordillera of the Andes at an average elevation of 4,400 masl. Kolpa is situated within the Central Cordillera of Peru along the central part in the recognized Miocene Polymetallic Mineral Belt, including deposits such as Yauricocha, Corihuarmi, Marta, Pucajaja, Palkwanka, Caudalosa Grande and El Milagro.

Kolpa is a Polymetallic Epithermal Low Sulfidation deposit, vetiform style with hydrothermal solutions filling fractures. Mineralization is hosted in a volcanic rock, tuff-breccias, latites and lava flows of the Huachocolpa Group. The deposit comprises multiple veins comprised of pyrite, sphalerite, galena, argentiferous galena, chalcopyrite and gray coppers.

Local structural context includes sub-vertical structures resulting from compressive stresses relating to the Andean Orogeny. Structural controls on mineralization result in well-developed arrays of ENE to NE trending vein-sets. The structural pattern can repeat and extend over other nearby sets of differently oriented structures, resulting in adjoining sequences overlapping to produce a form of ‘structural pairing'.

Mineral Resource Estimate

As part of the Company's evaluation of the Kolpa mine, Endeavour has filed a technical report prepared in accordance with NI 43-101 entitled, "Technical Report on the Huachocolpa Uno Mine Property, Huancavelica Province, Peru" (the "Current Technical Report"). The Current Technical Report has an effective date of December 31, 2024, and was prepared by Allan Armitage, Ph. D., P. Geo., Ben Eggers, MAIG, P.Geo., Henri Gouin, P.Eng. of SGS Geological Services, Dale Mah, P.Geo., and Donald Gray, SME-RM of Endeavour.

The Current Technical Report contains a historical mineral resource estimate (the "Historical Estimate"), originally disclosed in a technical report prepared for the Shareholders titled "Huachocolpa Uno Preliminary Economic Assessment" dated May 7, 2024 (the "2024 Technical Report"). The 2024 Technical Report provided a preliminary economic assessment study and also outlined a mineral resource estimate, which was updated by Minera Kolpa as of October 2024 with an effective date of August 31, 2024 (the "Kolpa Technical Report"). The economic analyses presented in the 2024 Technical Report and the Kolpa Technical Report are not considered current, are not being relied upon by Endeavour and should not be considered as representing the expected economic outcome under Endeavour's ownership.

The Historical Estimate presented in the table below is historic, is not considered current and is not being relied upon by Endeavour. A qualified person has not done sufficient work to classify the Historical Estimate as current mineral resources. The Company is not treating the Historical Estimate as current mineral resources, has not verified this information and is not relying on it. Following closing of the Transaction, Endeavour plans to prepare a current mineral resource estimate for Kolpa, develop exploration targets and analyze the economics of various scales of production.

 

 

Grade

Contained Metal

Category

Tonnage

Ag

Pb

Zn

Cu

Ag

Pb

Zn

Cu

 

(Mt)

(oz/t)

(%)

(%)

(%)

(Moz)

(Kt)

(Kt)

(Kt)

Measured

2.8

4.07

3.99

3.83

0.33

11.3

110.8

106.3

9.2

Indicated

3.5

2.92

3.06

3.07

0.24

10.1

105.7

106.1

8.3

Measured & Indicated

6.2

3.43

3.47

3.41

0.28

21.4

216.5

212.4

17.5

Inferred

5.0

2.90

3.02

3.37

0.24

14.6

152.3

170.0

12.1

Infrastructure

Mining operations are supported by well-developed infrastructure which allows for responsible, safe, efficient and environmentally friendly operations. Power is supplied by high voltage transmission lines with backup generator systems. Water treatment plants are located on site to treat water for recirculation or permitted local discharge. On site camps have the capacity to house up to ~1,700 workers year-round.

Mining and Recovery Methods

The main mining methods at the Kolpa underground operations are sublevel stoping and cut and fill. The underground operations occur primarily at the Bienaventurada vein and at the parallel and tensional type structures associated with it. The Bienaventurada vein is the most important structure of Kolpa. This production is supplemented with ore from the Yen vein and orebodies, which are the second most important structures of Kolpa.

The concentrator plant processes the polymetallic ore following a conventional selective flotation process to obtain a first bulk concentrate with subsequent separation of lead-silver, zinc and copper-silver concentrates.

Operating History

Kolpa originally began as a small-scale operation and has been in continuous production for over 25 years. The operation has undergone numerous throughput expansions, more than doubling installed capacity from 800 tpd in 2016 to approximately 1,800 tpd by the end of 2024. The Kolpa mill also performs some small-scale third-party toll milling (approximately 6% of mill throughput). The following table sets forth historical performance from 2016 to 2024 at the Kolpa processing plant.

 

Operating Year

 

2016

2017

2018

2019

2020

2021

2022

2023

2024

Tonnes Processed

283,714

283,445

326,005

400,117

455,564

593,545

631,455

661,535

686,503

Head Grade Ag (opt)

3.39

3.80

3.99

3.40

2.26

2.04

2.66

3.06

3.30

Head Grade Pb (%)

4.21

3.34

3.07