Royal Road signs deal that helps formalize Colombian artisanal miners

Reference image of artisanal mining in Colombia. (Image by Lady Castro, Flickr).

Royal Road Minerals (TSXV: RYR) entered into a formalization agreement and a related earn-in option and royalty agreement with Sociedad Minera San Antonio S.A.S., a company that represents the interests of informal miners that have been carrying out small-scale mining activities at the El Gualtal gold mine, located in Colombia’s Nariño District.

In a press release, Royal Road said the agreements were negotiated under the framework of the Colombian government’s National Policy for Mining Formalization adopted by the Ministry of Mines and Energy. 

Gold mined at El Gualtal is coarse and free and is recovered by gravity separation 

According to the miner, under the terms of the formalization agreement, a specific portion of the area under the concession will be returned by its subsidiary Exploraciones Northern Colombia (ENC) so that a new concession over such returned area may be granted to San Antonio for the benefit of over 1,000 informal miners.

In exchange, ENC will receive a quarterly royalty equivalent to 3% of the doré extracted from the concession and has been granted the sole and exclusive right to carry out all exploration activities on El Gualtal. The Jersey-based firm also has the right to acquire 70% of the concession, subject to the completion of a minimum of 6000 meters of drilling, underground sampling and an internal feasibility study within five years of the date on which San Antonio is registered as the owner of El Guatal.

The mine is a shallow-dipping, quartz-carbonate vein system, with 75 room and pillar style production adits, developed over at-least nine different levels and 140 meters of vertical separation. 

Royal Roads estimates that El Guatal is one of the largest informal mining operations located in the La Llanada Goldfield. 

“Information about historic gold production reveals that past production at the El Gualtal gold mine may have been in the order of 300 tonnes of hand-picked ore per day,” the miner’s media brief reads. “Today, 40 adits are active and the company estimates that production from informal mining operations is currently between 100 and 150 tonnes of hand-picked ore per day.”

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