Cerro de Pasco acquires Volcan’s mining assets in Peru for $30 million
Cerro de Pasco Resources (CSE: CDPR) has executed a definitive share purchase deal with Volcan Compañia Minera SAA and its subsidiaries, whereby CDPR will acquire all of the issued shares of Oxidos de Pasco SAC, Empresa Administradora de Cerro SAC and Remediadora Ambiental SAC (together referred to as the target companies).
The transaction will grant CDPR ownership and operation of all mining and processing assets in Cerro de Pasco, central Peru. Cerro de Pasco was one of the oldest and largest polymetallic mines in the world, operating for almost 400 years.
Under the terms of the deal, all of the target companies’ issued and outstanding common shares will be acquired by CDPR for $30 million, a variable consideration and a net smelter royalty over the concessions.
CDPR will acquire all the target companies’ permits, licenses and concessions. The gold-silver properties are located at the Cerro de Pasco mining complex and consist of the following:
- The Oxidos precious metals leach processing facility, permitted at 2,500 tpd;
- The Paragsha base and precious metals concentrator, permitted at 17,500 tpd;
- The San Expedito base and precious metals concentrator, permitted at 1,800 tpd;
- The Santa Rosa oxide open pit that hosts mineral for processing through the Oxidos plant;
- The Raul Rojas sulphide open pit;
- The Lourdes and Excelsior underground shafts;
- All associated surface infrastructure; and
- Over 12,000 hectares of exploitation and exploration concessions that host existing porphyry exploration potential.
CDPR has already acquired the mineral rights on the Excelsior mineral pile and the Quiulacocha tailings on the El Metalurgista mining concession, and plans to complete an NI 43-101 resource calculation in the near future.
Volcan will receive a royalty of 2% of the net smelter return and enter an offtake agreement in respect of all zinc and lead concentrates from ore resources owned by Cerro SAC, as well as a right of first refusal to purchase all concentrates produced from CDPR’s El Metalurgista concessions.
At market close Thursday, CDPR’s stock was up 4.3% on the CSE. The company has a C$89.8 million market capitalization.