Red Metal Resources, via its Chilean subsidiary Minera Polymet, has signed a five-year mining lease agreement with Minera KMT for the Farellon 1/8 mineral concession within its Carrizal Copper-Gold-Cobalt Property in Chile’s Atacama Region.
Under the agreement, Minera KMT will maintain a minimum monthly production of 2,500t following a seven-month development period, providing consistent revenue for Red Metal’s Chilean operations.
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KMT will begin mining in the historic workings at Level 7, which previously yielded 5,080t of ore containing significant copper and silver grades.
The contract also stipulates that Minera Polymet will receive 10% of sales from copper, silver and gold ores (minus a 1.5% existing royalty) and 15% for cobalt-bearing ores.
Historic operations at the Carrizal property from 2015 to 2017 produced 12,905t of sulphide ore containing 528,168lb of copper, 2,829oz of silver and 95oz of gold.
This resulted in overall grades of 1.86% copper, 7.8 grams per tonne (g/t) silver and 0.23g/t gold.
The upper levels contained 1,814t of oxide ore with a copper grade of 1.56%.
The ore was transported to the ENAMI processing facility and demonstrated substantial mineral content, emphasising the potential of the site.
Red Metal Resources president and CEO Caitlin Jeffs said: “We are extremely pleased to be able to reactivate production at Carrizal. The high-grade copper-bearing ore at Carrizal is readily accessible, and we have engaged an experienced local miner.
“This continued mining effort on the Carrizal property directly supports Chilean mining and local miners in the area and provides a reliable revenue stream for Chilean operations.”
The Carrizal property, located in the Carrizal Alto mining district, includes 21 mining concessions covering a total of 3,278 hectares (ha).
It is split into the Farellon project, spanning 1,234ha, and the Perth project, covering 2,044ha.
Situated approximately 75km north-west of Vallenar and 150km south of Copiapó, it lies 20km west of the Pan American Highway in the Coastal Cordillera belt.
