Silver Wheaton Acquiring Mercator's Silver Production

VANCOUVER - Silver Wheaton Corp. has agreed to purchase all of the silver produced by Mercator Minerals Ltd. at its copper-molybdenum-silver Mineral Park Mine in Arizona. 
Upon the successful close of the transaction, Silver Wheaton will pay Mercator an upfront cash payment of US$42 million in order to acquire the silver produced by the Mineral Park Mine over its entire mine life, for the lesser of US$3.90 (subject to a one percent annual adjustment beginning three years after a minimum production level has been met) and the prevailing market price per ounce of silver.  Payment for the transaction will be drawn from existing credit facilities and Silver Wheaton is not required to pay any further capital expenditures for the life of the mine.
The Mineral Park Mine currently produces copper from SX/EW leach operations, but construction is well underway on a flotation operation that will produce copper-silver and molybdenum concentrates.  Mercator expects that concentrate production will commence before July 2008 from a 25,000 tons per day operation, with production increasing to 50,000 tons per day approximately nine months later.  All permits for the expansion are in place and the expected mine life is 25 years.  Payable silver production is expected to average approximately 600,000 ounces per annum over the first 21 years of operations and the ore body is considered to have excellent exploration potential.
Mercator will provide a completion guarantee to Silver Wheaton, specifying a minimum production level by a certain date.
The company's address is 666 Burrard Street, Suite 3150, Vancouver, BC V6C 2X8, 604-684-9648, fax: 604-684-3123, email: [email protected].