Element79 Gold successfully manages a diverse portfolio, optimizing financial returns and advancing key projects such as the high-grade Lucero project in Peru.
The company demonstrates a strong commitment to sustainable mining and community collaboration, notably through partnerships with local artisanal miners to enhance mutual economic benefits.
Through strategic sales and partnerships, such as the Maverick Springs transaction, Element79 Gold enhances its financial stability and provides non-dilutive capital to fuel further exploration and development.
Element79 Gold Corp. (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS) has successfully concluded the Binding Option Agreement with Sun Silver Limited, resulting in the transfer of ownership of the Maverick Springs Project to Sun Silver. This achievement marks a significant step in Element79 Gold Corp.’s ongoing strategy to enhance shareholder value through judicious asset management and partnerships.
About Element79
Element79 Gold (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS), a mining entity focused on gold and silver, is strategically positioning itself for significant operational advancements. The company is on track to recommence production at its Lucero project in Arequipa, Peru, targeting a restart by 2024. Lucero, known for its high-grade deposits, stands as a cornerstone in Element79 Gold’s portfolio.
In addition to its developments in Peru, Element79 Gold holds an impressive suite of assets along the Battle Mountain trend in Nevada. This includes the promising Clover and West Whistler projects, which show potential for rapid resource development. Notably, three properties within this portfolio are poised for sale to Valdo Minerals Ltd., with the transaction expected to be finalized in the first half of 2024.
Expanding its geographical footprint, Element79 Gold is also making strides in British Columbia. The company has initiated a drilling program and signed a Letter of Intent to acquire a private company holding an option for 100% interest in the Snowbird High-Grade Gold Project. This project comprises 10 mineral claims located strategically near Fort St. James, reinforcing the company’s asset base in central British Columbia.
Further enhancing its asset management strategy, Element79 Gold has moved its Dale Property, located approximately 100 km southwest of Timmins, Ontario, into a spin-out process through its wholly owned subsidiary, Synergy Metals Corp. This strategic realignment is aimed at maximizing shareholder value through efficient asset utilization and focused corporate structuring.
Highlights of Element79 Gold’s Strategic Developments
Since its acquisition in 2021, Element79 Gold has diligently advanced the Maverick Springs project, culminating in an updated 43-101 compliant inferred resource estimation of 3.71 million ounces of gold equivalent (AuEq).
In pursuit of strategic partnerships to further develop Maverick Springs, Element79 Gold’s management successfully negotiated and entered into a Binding Option Agreement with Sun Silver in August 2023. This pivotal move aligns with the company’s strategic focus on the high-grade Lucero Project in Peru, which boasts near-term production potential. The transaction with Sun Silver not only shifts the company’s focus but also realizes significant value for Maverick Springs. Originally acquired and carried at CAD $3.337 million, the project was sold for CAD $5.033 million, reflecting an impressive return on investment of 51% within 28 months.
The sale generated substantial financial gains for Element79 Gold, amounting to CAD $4,400,000 in cash and 3,500,000 ordinary shares in Sun Silver, valued at AUD $0.20 per share (fair market value of AUD $700,000). These shares are anticipated to be listed on the Australian Stock Exchange around May 15, 2024.
A portion of the proceeds, CAD $2,200,000, will be allocated to settle the loan tied to the Waterton Contingent Value Rights Agreement. The remaining funds will be strategically used to further the development of other corporate projects and operations, reducing both capital debt and accounts payable. This strategic financial management underscores Element79 Gold’s commitment to optimizing its asset portfolio and enhancing shareholder value in the competitive mining sector.
Key Financial Highlights
Updated Resource Estimation: 3.71 million ounces of gold equivalent (AuEq).
Sale of Maverick Springs: Achieved a final sale value of CAD $5.033 million, marking a 51% ROI over 28 months from an acquisition and carrying cost of CAD $3.337 million.
Proceeds from Sale: Totaling CAD $4,400,000 in cash and 3,500,000 shares in Sun Silver, priced at AUD $0.20 per share.
Share Listing: Shares expected to be listed on the Australian Stock Exchange around May 15, 2024.
Loan Repayment: CAD $2,200,000 of the proceeds will be used to settle the loan associated with the Waterton Contingent Value Rights Agreement.
Funding Future Projects: Remaining funds will be used to advance other corporate projects and operations, while reducing capital debt and accounts payable.
“The successful closing of the transaction highlights Element 79’s steadfast dedication to executing its strategic roadmap. This is a critical milestone in the Company’s history: it stands as proof of our team’s ability to generate value through project execution, and indicates a potential turning point in our ongoing mission to build a stronger and more focused company; it reinforces diligent financial management by to clearing up the balance sheet from past endeavours, and it provides non-dilutive capital to support operations and advance strategic exploration programs on our core properties to generate further value for our investors.“
James Tworek, CEO of Element 79 Gold Corp
Collaboration with Artisanal Miners at Element79 Gold
Element79 Gold (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS) has actively engaged with local artisanal miners in Lomas Doradas to promote sustainable mining practices and community collaboration. In April, the company’s community relations team organized a significant meeting aimed at enhancing mutual support and establishing a formal collaboration for mineral extraction and ore sale processes.
During this meeting, Element79 Gold presented draft contracts proposing 10-year surface access rights for exploration at the Lucero mine site, alongside similar access for local miners in designated areas. These agreements were intended to unify efforts and optimize ore market pricing, with the goal of creating mutual economic benefits.
A critical follow-up meeting was held in Chachas on April 28th, where the community voted on these initiatives. This gathering aimed to solidify the partnership between Element79 Gold and the artisanal miners, moving towards formalizing their cooperative relationship and ensuring continued updates on the initiative’s progress.
Conclusion
Element79 Gold (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS) is exemplifying strategic acumen and operational dexterity across its diverse portfolio. By actively managing its assets from the Lucero project in Peru to strategic ventures across Nevada and British Columbia, the company is effectively balancing exploration potential with financial stability. The successful negotiation and sale of the Maverick Springs project, alongside collaborative engagements like those with the artisanal miners of Lomas Doradas, highlight Element79 Gold’s commitment to ethical practices and community involvement.
