VANCOUVER, B.C.– BioteQ Environmental Technologies, Inc. (TSX: BQE), a leader in the treatment of industrial waste water, has reached agreement with NWM Mining (TSX-V:COL) to re-start operations at the Lluvia de Oro – La Jojoba gold mine site in Mexico. The agreement provides for NWM Mining to pay BioteQ for the capital cost of its SART plant plus a profit margin, provides an on-going operating contract and technology fee to BioteQ for SART operations, and re-payment of loans made by BioteQ to NWM Mining, including accrued interest. The first loan payment of $500,000 has been received by BioteQ.
Brad Marchant, BioteQ’s CEO stated, “We are pleased to reach agreement with NWM Mining and Global Resource Fund, to re-establish active operations at the Lluvia gold mine site. Global has agreed to provide NWM Mining with US$1.5 million in financing, to enable NWM to resume gold production at the Lluvia site, and initiate re-payment of the loans and capital provided by BioteQ to the project. This agreement enables BioteQ to recover its investments at the site as well as generate a continuing revenue stream over the life of the gold mine from water treatment operations.”
During 2008, BioteQ built a SART plant at the Lluvia gold mine, designed to remove dissolved copper from gold-leach solution and regenerate cyanide leaching reagent for recycle to the gold operation. In addition to investing $6.4 million for the SART plant, BioteQ provided the mine site owner, NWM Mining, with $4 million in financing to bring the mine site into production in order to facilitate the launch of a new application of BioteQ’s sulphide technology into the gold mining sector, in combination with SART technology which was developed by SGS Lakefield. The loans were secured by the project assets of the mine site, including the mining claims.
The SART plant was successfully commissioned in 2008. BioteQ has worked with NWM Mining and NWM’s third-party lender, Renvest Mercantile Bancorp through its Global Resource Fund, to develop a plan for re-activated operations at the site. The parties have come to agreement as of June 12, 2009. This agreement replaces all previous agreements between BioteQ and NWM Mining.
All financial numbers are in Canadian funds, unless otherwise noted.
NWM has agreed to a definitive schedule of payments for the loan from BioteQ, including accrued interest outstanding, totaling $4.4 million. The first payment, a lump sum of $500,000, has been received by BioteQ; the re-payment schedule for the balance of the loan commences in January 2010, with payments of $50,000 per month which then increase to $125,000 per month as of January 2011. The loan payments include an accelerator clause based on gold price and net project cash flow.
NWM has agreed to make SART plant payments on a lease-to-own basis, to a total of $9.6 million. Lease payments of US$150,000 per month are scheduled to commence October 2010. The agreement includes a technology fee of US$0.035 per pound of copper recovered and US$0.25 per pound of cyanide regenerated, payable for the duration of plant operations. The SART plant payments include an accelerator clause based on gold price and net project cash flow.
NWM has agreed to a services contract with BioteQ for SART plant operations, at commercially competitive rates for plant supervisory and maintenance personnel. BioteQ has agreed to provide a process guarantee during the first year of operations.
To ensure that the plan can be executed, BioteQ, NWM Mining, and Global Resource Fund have agreed to the following conditions:
- NWM will complete an equity financing of not less than $2 million by September 30, 2009.
- Global Resource Fund has provided an additional US$1.5 million in debt financing to NWM Mining. NWM Mining will establish a new management team, to be unanimously approved by a three party steering committee comprised of representatives from each of BioteQ, Global Resource Fund, and NWM.
- NWM has provided a production plan acceptable to both BioteQ and Global Resource Fund, showing an operating mine life to 2016, based on NI 43-101 compliant resources.
- BioteQ and Global Resource Fund have entered into a collateral sharing agreement for the site assets.
BioteQ Corporate Profile
BioteQ is a water treatment company that applies innovative technologies and operating expertise to solve challenging water treatment problems, reducing environmental liabilities while delivering lower life cycle costs for water treatment. The Company’s commercially proven technologies treat industrial wastewater contaminated with dissolved heavy metals and sulphate, producing saleable by-products and clean water that can be discharged safely to the environment.
BioteQ’s sustainable water treatment solutions have been recognized with the Globe Award for Environmental Excellence, the PDAC Award for Environmental and Social Responsibility, the China Mining Environmental Protection Award, and the Mines & Money Sustainable Development Award. BioteQ has built 8 plants at sites in Canada, the US, China, Australia and Mexico, with additional projects in design and construction. BioteQ is headquartered in Vancouver, Canada, and trades on the TSX under the symbol BQE. For additional information, please go to www.bqewater.com
On behalf of the Board of Directors
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.