Sandstorm Gold to Exercise Underground Mine Option for SilverCrest’s Santa Elena

SilverCrest Mines Inc. (TSXV:SVL,NYSEMKT:SVLC) announced that Sandstorm Gold Ltd. (TSX:SSL,NYSEMKT:SAND) plans to exercise its underground mine option for the Mexico-based Santa Elena mine. The option allows Sandstorm to purchase 20 percent of the gold produced from underground operations at the mine.

As quoted in the press release:

In consideration of exercise of the option, Sandstorm will make an additional upfront deposit of US$10 million to the Company on or before March 17, 2014 and will continue to make ongoing per ounce payments of US$350 until 50,000 ounces of gold have been delivered to Sandstorm, inclusive of 18,593 ounces already received from open-pit production, at which time the payments will increase to US$450 per ounce of gold.

N. Eric Fier, president and COO of SilverCrest, commented:

The upfront deposit of US$10 million will improve our cash balance and further enhance the Company’s financial position to achieve its 2014 goals for the mine expansion at Santa Elena. We are pleased with Sandstorm’s expression of confidence in Santa Elena Mine, and our continued mutually beneficial relationship.

Click here to read the full SilverCrest Mines Inc. (TSXV:SVL,NYSEMKT:SVLC) press release.