Location	Iberian Pyrite Belt
Ownership	Optioned to Minas de Aguas Teñidas, S.A.  (Sandfire MATSA)
Size	115 km2
Deposit Type	VMS
Exploration Stage	Exploration
Status	Drill program underway
Presentation	The Alvalade Opportunity The Sesmarias Discovery

Avrupa acquired the Alvalade Project in 2010 and initially optioned it out in 2012, but has been the operator of the project since acquisition. During that first earn-in period (2012-15), an initial hole, SES002, was drilled into the Sesmarias target and intersected 10.85 meters of 1.81% copper, 2.57% lead and 4.38% zinc. Drilling encountered numerous faults, but subsequent holes hit mineralization, on and off, over an 800-meter strike length, including SES010 which intersected 58 meters of 0.32% copper, 0.61% lead, 1.95% zinc, 0.45 g/t gold, 25 g/t silver. There is still at least another 1,000 to 1,500 meters of known mineralization along strike to the north, encountered in historic drilling.

The new, upgraded Alvalade license covers approximately 115 square kilometres of highly prospective target area in a prime portion of the Iberian Pyrite Belt in Portugal.  The Sesmarias massive sulfide discovery lies just 7 kilometres south of the historic Lousal Mine and 9 kilometres south of our Monte da Bela Vista stockwork zone, all of which are covered by the Alvalade license.  Previous work at Sesmarias by Avrupa, itself, and by Avrupa with support from former JV partners, indicates that massive sulfide mineralization extends for at least 600 metres, may be as wide as 300 metres, and averages 25 metres in thickness.  Our work around Sesmarias also indicates that there is, at least, a further 2,000 metres of potentially mineralized target zone beyond the 600 metres of known massive sulfide mineralization.

Several technical sources estimate that the Lousal Mine originally contained upwards of 50 million metric tonnes of iron-, copper-, and zinc-bearing massive sulfide mineralization.  However, old mining records indicate that only 15-20 million metric tonnes of mineralized material were actually extracted during historic operations beginning in 1900 and continuing through 1988.  An independent consultant’s report commissioned by Avrupa in late 2017 suggests that Monte da Bela Vista-Lousal-Sesmarias could easily become a 50- to 100-million metric tonne copper-zinc, massive sulfide district.  Note, that these calculations are not compliant to NI 43-101 or JORC regulations, but are considered to be reliable support information to the working exploration model for the district.

In addition, the under-explored, historic Caveira Mine area is located just 9 kilometres north of Monte da Bela Vista, and between the two are several Avrupa scout drill holes that intersected sulfide mineralization.  Furthermore, Avrupa has drilled mineralized scout holes in several target areas along a 25-kilometer line from Sesmarias to the south end of the Alvalade license.

The Project is currently optioned out to Minas de Aguas Teñidas, S.A.  (Sandfire MATSA) under the following terms:

In order to acquire a 51% interest in PorMining Lda.– “The Experimental Exploitation Phase”:

• MATSA must provide to Avrupa 400,000 Euros (approximately C$ 580,000) payment upon signing of the Definitive Agreement.  Completed
• MATSA must provide the required work commitment guarantee of 240,000 Euros (approximately C$ 348,000) upon issuance of the new Alvalade Experimental Exploitation License (EEL) to the new JV company (Newco), to be set up to hold the license. This amount is refundable to MATSA pending completion of the license work commitment and approval by the Portuguese Mining Bureau (DGEG).  Completed
• MATSA must provide 1.2 million Euros (approximately C$ 1,860,000) for work on the Project during the first year after signing of the Definitive Agreement.  Underway
• MATSA must provide, at its sole discretion, an additional 2 million euros for work over the second and third years of the joint venture.
• Avrupa will be the Operator in this phase of work and will be paid 100,000 Euros (approximately C$155,000) annually as an operator’s fee.

In order to acquire a further 34% interest in PorMining Lda., for a total of 85% — “The Feasibility Study Phase”, MATSA must, at its option:

• Provide a “bankable feasibility study” on one prospect within the Alvalade license. MATSA is responsible for 100% of the costs to produce the feasibility study, including preparation of a NI 43-101 compliant resource estimate;
• Fund all necessary success-based payments to Avrupa’s previous joint venture partner, Antofagasta Minerals, S.A., as required by the Debt Cancellation Agreement between Avrupa and Antofagasta (see news release of June 19, 2017).

Project Commitment and Construction Phase:

• In conjunction with the completion of the feasibility study, MATSA would be responsible to ensure that the application for a Mining License at Alvalade is completed, as required by Portuguese Mining Law.
• During the Construction Phase, Avrupa will have the choice to participate as a 15% shareholder by providing its pro rata share of the necessary funding, or elect to transfer its 15% interest in PorMining Lda.to MATSA in exchange for staged payments of 10 million euros (approximately C$ 15.5 million), as follows:

1. 3,000,000 Euros upon a construction decision being made, and the permits received from the DGEG;
2. 3,000,000 Euros upon commencement of commercial production; and
3. 4,000,000 Euros upon the first anniversary of commercial production.

• The remainder of necessary success-based payments to Antofagasta would be borne by the Project, in accordance with the respective holdings in PorMining Lda..
• Completion of the earn-in and joint venture arrangement remains subject to a number of conditions, including finalization of the Definitive Agreement itself, issuance of the Alvalade Experimental Exploitation License by the DGEG, and receipt of any required board and/or regulatory approvals. All legal due diligence has already been completed by MATSA.  Completed