Below is an example of a mining company in Chile that announced on Friday the selling their claim for roughly 10% of in-ground resource value.
Medinah Minerals, Inc. (USA) is very pleased to report that they have been notified by Medinah Minerals (Chile) S.A. of the completion of a Purchase Agreement, among parties, for the sale of the entire Altos de Lipangue group of mineral properties located near Santiago, Chile.
The finalized Purchase Contract comprises an end price of $180 million USD dollars, for the purchase of an 85% ownership in the entire group of One Thousand Five Hundred Eight (1,508) minerals claims. The Altos de Lipangue owners retain a 15% “free-carried” interest in the properties and all production thereafter. Payments include an initial deposit followed by block remittances each 9 months over a 3-year period and a payout at the end of the 3rd year. Until payment is received in full, the purchasers do not earn any ownership interest in the properties. The purchasers may, at any time, complete the purchase of their 85% interest by way of making full payment of the $180 million, or remaining portion thereof.
The Purchase Contract includes the immediate commencement of an extensive exploration program, including a minimum of 18,000 meters of diamond drilling. The contract contains an additional variable component that could increase the end purchase price. At the conclusion of the development program, the gross metal values will be recalculated and, if this value exceeds the present base calculations of Two (2) billion dollars, the purchase price will be increased to the benefit of Medinah Minerals (Chile) S.A. owners. The goal of the purchasers is to prove up substantial ore tonnages beyond base amounts derived in all previous explorations.
Link back to jkm1's post and you get a $200M valuation for MMTE's Maricunga concession alone based on the same formula employed above, which I have seen time and time again and seems to be an industry standard for calculating buyouts of mining concessions.
Keep in mind the Maricunga concession is only 8,600 acres of the 24,000 MMTE has already announced.
Cha-ching.
AI
