Cerro de Pasco Resources (CSE: CDPR) says it’s selling its Santander zinc-silver mine to a Peruvian distressed asset investor for as much as US$10 million in shares to reduce debt and focus on a separate tailings reprocessing project.
Santander, located about 215 km northeast of Lima, comprises an underground mine, a 2,000-tonne-per-day processing mill, a conventional sulphide flotation mill and associated infrastructure.
The deal is to be calculated and paid to private equity firm Finanzas e Inversiones Corporativas depending on commercial production reached in the Santander pipe, Quebec-based Cerro de Pasco said.
CEO Guy Goulet said the sale aligns with the company’s strategy of reducing debt. The company acquired the Santander mine in late 2021 from the now-collapsed Trevali Mining. In June 2023, the operation was wound down because of weak zinc prices.
The company said it’s focused on developing its principal asset, the El Metalurgista mining concession in central Peru. It holds the 30.1-million-tonne Excelsior stockpile and the 74.7million-tonne Quiulachcocha silver and gold mine tailings grading 1.6% copper, 1.3% lead, 2.2% zinc, 39 to 80 grams silver per tonne and 1.2 grams gold.
Shares in Cerro de Pasco Resources fell 1¢ to 12¢ apiece in Toronto on Wednesday morning. The company has a $45.4 million market capitalization.
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