The past-producing gold mine in Arizona is aimed to be brought back into production by Kerr Mines in 2021
Kerr Mines has closed the first instalment of a $18m streaming deal with Star Royalties for financing the restart of its Copperstone gold mine in Arizona, the US.
As per the gold purchase and sale agreement signed by the parties, Star Royalties will make the advanced payment of $18m in three equal instalments to Kerr Mines, of which the first installment of $6m has been now made.
Under the terms of the deal, Star Royalties will buy 9.9% of the gold produced at the mine until a total of 21,000 ounces of refined gold are delivered.
After this, Star Royalties will purchase 3.3% of gold produced at the mine up to a total of 27,200 ounces, and thereafter 1.2% of the gold production for the remaining life of mine.
The other two tranches will be advanced at the request of Kerr as it spends towards the restart of the gold mine, which is aimed for next year.
Star Royalties CEO Alex Pernin said: “Following our comprehensive due diligence process, we have great confidence in both Copperstone’s potential and Kerr’s ability to execute a successful restart of operations. We look forward to working closely with their team as we transition Copperstone into Arizona’s next gold producing mine.”
Located in LaPaz County in Western Arizona, Copperstone is a past-producing mine with existing infrastructure. The mine was acquired by Kerr Mines in 2014.
The company aims to maximise the potential of the mine by defining and expanding current resources, and also by further optimising its economics.
Kerr Mines CEO Giulio Bonifacio said: “We are excited to enter this new chapter for Kerr Mines with the closing of this first installment of the Copperstone stream financing. We look forward to working with Star Royalties to expeditiously restart operations at our flagship asset.
“Our focus now shifts to securing long term lead items, finalising the process facilities to accommodate our whole ore leach approach, and sourcing underground contractors and equipment.”
Meanwhile, with regard to closing of the streaming deal, Kerr, Trans Oceanic Minerals Company (TOMCL) and Braydon Capital Corporation amended some terms and conditions of the outstanding debt held by the latter two.