Colombia’s national mining agency, the Agencia Nacional de Mineria (ANM) has indicated that its process related to the technical information and finalisation of the legal documents for the extension of Canadian junior mining company Caldas Gold’s Marmato mining contract will be completed by mid-January.
The certification status of the proceedings relates to Caldas' request for a 30-year extension of mining contract 014-89M, which is set to expire in October.
Following several work sessions in which the technical, legal, social, environmental and economic information was presented as the basis for the company’s extension request, an agreement has been reached with ANM on the economic conditions.
The key economic conditions associated with the approval of the extension request include an increase in the royalty rate paid to the ANM on gold production to 7%, from 6% previously.
The royalty payment to ANM on silver revenue will remain at 8%, while there is ongoing commitment by Caldas to fund yearly social investment based on a rate of $25/oz produced, adjusted yearly based on changes in the US consumer price index, and subject to a yearly minimum of $300 000, which is also indexed yearly based on the US consumer price index.
Another condition is a contract premium of $6-million to be paid over a four-year period, indexed yearly based on the US consumer price index.
Caldas chairperson and CEO Serafino Iacono says the company is pleased with the cooperative manner in which its mining title extension request is being handled. “It is clear that all parties understand the importance of this project to the nation, the Department of Caldas, the local community at Marmato and to our investors.”
He adds that Caldas looks forward to the successful conclusion of the extension process later this month, enabling the company to bring the Aris Gold transaction to a close and to move ahead more aggressively with the Marmato expansion.
This will be done by accessing funds available under a streaming agreement with Wheaton Precious Metals and being held in escrow from Caldas' gold notes financing.