Hounde South Gold Project

Hounde South is a project that is being funded by Fortuna Silver Mines (Formerly Roxgold Inc) through a farm-out agreement, as outlined below:

Under the Earn-in Agreement, Fortuna can acquire an initial 51% interest in the Project with the option to increase its interest to 70% through exploration expenditure as follows:

• First earn-in stage – Fortuna earns 51% interest by spending US$600,000 (~A$0.9 million) over two years;
• Second earn-in stage – Fortuna may increase its interest to 70% by spending US$400,000 (~A$0.6 million) over the following two years; and
• Fortuna and Arrow will form a joint venture where both companies contribute according to their interest for the remainder of the project life.

The Project consists of two exploration licences (being the Fofora and Konkoira permits) adjacent to Fortuna’s Boussoura permit in southwest Burkina Faso (see map). Historical exploration at the Project included stream sediment sampling that demonstrated the potential for gold mineralisation traversing both Arrow’s and Fortuna’s licenses.