(Alliance News) - Orosur Mining Inc on Tuesday said it has entered into a preliminary agreement to sell its mining and exploration permits in Uruguay to fellow Canadian miner IMC International Mining Corp for a USD1 million cash consideration.
The South America-focused gold explorer said it has entered into a letter of intent to sell its mining and exploration permits in the San Gregorio area of Uruguay to IMC. If the sale is completed, the proceeds will be used to pay liabilities in Uruguay in connection with the previously announced court approved creditors’ settlement agreement, Orosur added.
Orosur Mining controls over 570,000 hectares in Uruguay and around 65,000 hectares of mining and exploration tenements in the San Gregorio area, which has estimated gold reserves of 122,949 ounces.
In August 2018, Orosur put its San Gregorio mine in Uruguay on care and maintenance due to falling grades, hitting production and increasing costs.
During the quarter to August 31, Orosur made progress in Uruguay after coming to a debt settlement agreement with creditors, which will see the proceeds from the sale of assets, alongside the issue of 10 million Orosur shares, fully satisfy debt owned to creditors.
Shares in Orosur Mining were 3.0% higher on Tuesday in London at a price of 3.09 pence each.
By Tapan Panchal; tapanpanchal@alliancenews.com
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Orosur Mining (OMI)