Element79 Gold has secured an exclusive right to purchase and process approximately 1.3 million tons of tailings from Palaza, a byproduct of past mining activities. This strategic acquisition aligns with Element79 Gold’s goal to enhance its resource base. The reprocessing project not only strengthens regional ties but also provides a solid foundation for the Company’s mining operations in the area surrounding the Lucero mine.
Image 1: Element79’s core mineral rights holdings of the Lucero past-producing mine, outlining the tailings facilities (Relaveras) and former Staging Area (Desmontera)
Key Highlights of the LOI Agreement:
Strategic Acquisition: Element79 Gold will purchase the tailings for $10 per ton, plus VAT, with further price adjustments based on the market value of gold. The acquisition is aimed at enhancing the Company’s resource base and securing institutional funding for growth.
Construction of Processing Plant: Element79 Gold has the authorization to build a processing plant on Palaza’s property, furthering its operational capacity and boosting output.
Initial Deposit and Due Diligence: The Company will undergo a comprehensive due diligence process following an initial deposit to ensure the project’s viability and profitability.
Royalties and Economic Impact: Element79 Gold will pay Palaza a royalty based on gold prices, contributing to economic benefits for both parties and the local communities.
New Technologies Being Tested: Element79 Gold is exploring innovative methods to improve safety and environmental sustainability in the processing plant.
Community and Environmental Considerations: The project will adhere to local regulations and prioritize environmental and community standards.
Project Data and Economic Projections
Total Tailings Volume: Approximately 1.3 million tons of tailings available for reprocessing on the Lucero mine’s ingress/egress road.
Processing Plant Capacity: The new plant will handle up to 350 tons per day of mineral.
Economic Impact: The agreement is expected to generate significant revenue streams and contribute to job creation and community investments.
Potential Revenue Generation from Tailings:
Estimated Recovery: Initial estimates indicate a total recoverable gold equivalent of 50,000 ounces through the project’s lifespan.
Projected Revenue: The project could yield gross revenues of $100 million, with significant contributions to the local economy.
Social and Environmental Benefits:
Social: The project addresses long-standing community concerns by remediating tailings and providing a regional hub for local miners.
Environmental: By addressing environmental issues, the project contributes to sustainable mining practices in the region.
Economic: The revenue-positive project aims to enhance operational capacity and eliminate logistical obstacles for local miners.
Next Steps:
Due Diligence: Following the deposit, Element79 Gold will complete due diligence to inform future projects and secure institutional funding for development.
Permitting, Community Consultation: The Company will work closely with the Chachas community and authorities to secure necessary permits and begin plant construction by early 2025.
Element79 Gold’s CEO, James Tworek, emphasizes the strategic value of the partnership with Palaza in enhancing the Company’s operational capacity and presence in Peru’s mining sector. The agreement not only strengthens Element79 Gold’s resource base but also contributes to long-term growth, profitability, and community development.
Qualified Person
The technical information in this release has been reviewed and verified by Kim Kirkland, Chief Operating Officer of Element79 Gold Corp, and a qualified person as defined by National Instrument 43-101.
About S.M.R.L. PALAZA 16
S.M.R.L. PALAZA 16 is a Peruvian mining company with a focus on sustainable and profitable operations in the Arequipa region, leveraging its extensive experience in managing Andean mining projects.
About Element79 Gold Corp
Element79 Gold focuses on exploring and developing high-grade gold and silver mines, including the Lucero project in Arequipa, Peru. The Company’s strategic portfolio positions it for near-term resource development and growth opportunities.
For more information about the Company, please visit www.element79.gold
Contact Information For corporate matters, please contact:
James C. Tworek, Chief Executive Officer and Director
E-mail: jt@element79.gold
For investor relations inquiries, please contact:
Investor Relations Department
Phone: +1.403.850.8050
E-mail: investors@element79.gold
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