Vancouver, British Columbia, October 1, 2021 – Parallel Mining Corp. (the “Company”) (TSX V: PAL) is pleased to announce that the Ministry of Mines and Petroleum in the Federal Democratic Republic of Ethiopia (“Ethiopia”) has granted the Company an exploration license for gold and base metals exploration in the Tigray region of Ethiopia. The exploration license EL00057 (the “License”), referred to as the Star Property, covers a total area of 399.73 square kilometers (the “Property”).
The Property is located within the Pan African, Neo-Proterozoic, Arabian-Nubian Shield. Historically the area of the License has been explored by other companies for volcanogenic massive sulphide (VMS) and intrusion-related shear zone gold mineralization. A number of prospects and deposits have been discovered in the license. Previous explorers had identified Volcanic Massive Sulfide polymetallic (“VMS”) deposits which are associated with and created by volcanic-associated hydrothermal events in submarine environments. They are predominantly stratiform accumulations of sulfide minerals that precipitate from hydrothermal fluids on or below the seafloor in a wide range of ancient and modern geological settings. VMS deposits can be major sources of zinc, copper, lead, silver and gold. VMS deposits may occur in clusters or stacks and have potential for significant resource size and they tend to occur at specific stratigraphic horizons, commonly boundaries between contrasting lithologies within volcanic successions.
Many gold occurrences are noted in the district with widespread occurrence of artisanal workings. Gold is associated with shear hosted quartz veining and often occurs in association with sulfides hosted within vein quartz. An association of gold with tourmaline was also observed by the company’s Technical Director Ian Cooper during a field visit in early 2019 and can be compared to the gold tourmaline association noted in many gold deposits in West African Craton. A study of available literature has indicated that this alteration style has not been previously identified in the Tigray region.
Ian Cooper said, “We are excited to have secured a number of VMS prospects in the license with known and identified mineralization and have recognized a potential game changer with the identification of alteration with tourmaline which is associated with gold prospects. This association has many similarities to gold projects that I have worked on in the Birimian terrane of West Africa.” Examples of gold projects with a tourmaline association include Barrick’s Loulu-Gounkoto mine in Mali (plus 16 million ounces), B2 Gold’s Fekola mine in Mali (plus 10 million ounces), Golden Star’s Wassa gold mine in Ghana (plus 10 million ounces) and Endeavour Mining’s Lafigué deposit in Côte d’Ivoire (2.5 million ounces). “Parallel intends to get on the ground as soon as it’s feasible to conduct further assessments of the tourmaline alteration occurring in the project and conduct brownfields exploration on the known deposits” said John Anderson, CEO and Director.
About the Arabian-Nubian Shield region:
The Arabian-Nubian Shield is a significant gold producer with numerous gold deposits and artisanal workings across the whole district. Host rocks are diverse ranging from graphitic mica schist and ultramafic rocks, example Lega Dembi in Ethiopia, to granite stocks, example Sukhaybarat East in Saudi Arabia, and associated with granite contacts, example El Sid and Umm Rus in Egypt. Other hosts include metamorphosed mafic lavas, volcaniclastic tuff, phyllites and granodiorites. Mineralization is present as quartz veins, veinlets, stringers, stockworks, and breccias. Veins are dominated by quartz, carbonate (calcite, dolomite and siderite), pyrite, arsenopyrite and pyrrhotite, and the wall rock alteration is typically sericite, chlorite, and carbonate.
In the Arabian-Nubian Shield VMS deposits occur in at least 60 occurrences distributed throughout Ethiopia, Eritrea, Sudan, Egypt and Saudi Arabia. These deposits and occurrences are concentrated in ten districts on either side of the Red Sea.
The Company further announces that it has entered into a loan agreement with John Anderson (“Anderson”), the President, CEO and a director of the Company, for the principal amount of USD$700,000 (the “Loan”). The Loan has a maturity date of July 16, 2022 and bears interest at a rate of 10% per annum. Use of proceeds from the Loan is to fund community relations projects in Ethiopia in coordination with the government of Ethiopia.
In consideration of the Loan, the Company agreed to grant Anderson a 2.0% net smelter return royalty in respect of all production from the License (the “NSR Royalty”). At any time during the term of the Loan, the Company will have the option to purchase one-half (equal to 1.0%) of NSR Royalty on the License by paying USD$1,000,000 to Anderson.
The Company further announces it has entered into a loan agreement with Tigray Holdings Corp. (“Tigray”) pursuant to which Tigray agreed to loan the Company the principal amount of USD$200,000. The loan has a maturity date of July 2, 2022, and interest is payable by the Company to Tigray on the maturity date at a rate of 10% per annum.
The Company announces that it intends to make an application to the Canadian Securities Exchange (“CSE”) to list its common shares on the CSE, and in connection therewith apply to delist its shares from the TSX Venture Exchange (TSX-V). The delisting of the Company from the TSX-V and the listing of the Company on the CSE will be subject to all applicable shareholder and regulatory approvals.
Related party transaction disclosure
As Anderson is a director and officer of the Company, the Loan constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security holders in Special Transactions (“MI 61-101“). The Company is relying on the exemptions from the formal valuation and minority shareholder approval requirements contained in sections 5.5(b) and 5.7(1)(a) of MI 61-101 on the basis that the Company does not have securities listed or quoted on any of the specified markets listed in section 5.5(b) of MI 61-101 and the fair market value of the transaction does not exceed 25%of the Company’s market capitalization.
Technical information in this news release was approved by Ian Cooper, the Company’s Technical Director and a Qualified Person as defined in National Instrument 43-101.
On behalf of the Board of Directors
Signed “John Anderson”
John Anderson, President and CEO
For further information, please contact:
PARALLEL MINING CORP.
President & Chief Executive Officer
Parallel Mining Corp.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains certain forward-looking information and statements. Forward-looking statements and/or information are based on a number of material factors, expectations and/or assumptions of Parallel Mining Corp. which have been used to develop such statements and information but which may prove to be incorrect. Undue reliance should not be placed on forward-looking statements. Parallel Mining Corp. can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding: receipt of all applicable regulatory and stock exchange approvals to delist from the TSX-V and list on the CSE. The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and/or statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results and/or events to differ materially from those anticipated in such forward-looking information and/or statements. Forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update forward-looking statements except as may be required by applicable securities laws.