Altamira Gold Corp. (CVE:ALTA) (FRA:T6UP) (OTCPINK:EQTRF) said it has received the C$500,000 from Mineracao do Para Ltda. (MAP) following completion of the transfer of title regarding the Crepori gold project which is located in the state of Para in Brazil.
The company has retained a 4% net smelter return royalty (NSR) as part of the agreement regarding the Crepori gold project, which is located approximately 5 kilometers (km) north of MAP's small hard-rock gold mining operation which currently produces an estimated 4,200 ounces of gold per year
Altamira said it has been informed that MAP will start stripping cover material in the next few months with the possibility of developing a small open-pit mining operation at Crepori which could provide cash flow to Altamira through the 4% NSR as early as Q2 2021
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In a statement, Michael Bennett, Altamira's president & CEO, commented, "The completion of the sale of the Crepori project to MAP, and the receipt of C$500,000, gives Altamira necessary working capital as we work to arrange financing for the construction of a mine and processing plant at our Cajueiro gold project in Mato Grosso. Just as important is the fact that the 4% NSR which we have retained could give the Company a revenue stream as early as Q2 2021 ahead of initial production from Cajueiro which is targeted for late 2021."
The group said it should be noted that production decisions respecting the Crepori and Cajueiro projects as currently foreseen may not be based on feasibility studies of mineral reserves demonstrating economic and technical viability. Consequently, there may be increased uncertainty as well as economic and technical risks associated with any such production decision.
The Crepori project is situated in the Tapajos Gold Province approximately 100km SW of the operating underground Palito and Sao Chico gold mines. An estimated 500,000 ounces of placer gold was recovered from drainages in the area during the Tapajos gold rush from 1978 to 1995 and small-scale historical hard-rock mining was also conducted along two gold-bearing quartz veins.
In November and December 2017, Altamira drilled seven reconnaissance holes for a total of 876 metres, but the results were generally disappointing.
Altamira said it continues to actively pursue a number of alternative funding arrangements for the US$6 million required to fund the construction of a 1000 tons per day gravity processing plant and surface mine, and is confident that it will secure funding in the near term.
The company added that whilst it has not formally terminated the Metalstream agreement, Metalstream is in default and has failed to deliver on the contractual arrangement to provide financing to Altamira, this despite repeated assurances from Metalstream of their ability to do so. Altamira has not received any funding from Metalstream to date.
The company said it has received several alternative written offers of project financing and is in advanced negotiations with several parties, but at this stage cannot provide further details regarding timing. Management is considering a number of options and is working to determine which, if any, are suitable for the group, Altamira added.
Altamira is focused on the exploration and development of gold projects within western central Brazil. The company holds nine projects comprising approximately 280,000 hectares, within the prolific Juruena gold belt which historically produced an estimated 7 to 10 million ounces of placer gold.
The company's advanced Cajueiro project has NI 43-101 resources of 5.66 million tons (Mt) 1.02 grams per ton (g/t) gold for a total of 185,000 ounces in the Indicated Resource category and 12.66Mt at 1.26 g/t gold for a total of 515,000 ounces in the Inferred Resource category.
Contact the author at jon.hopkins@proactiveinvestors.com