AUMN Golden Minerals Company Continues trimming overhead
May 31, 2012 07:00 ET
Golden Minerals Announces Sale of Platosa Royalty for $2.4 Million and Engages Canaccord Genuity for the Sale of the Zacatecas Land Package
GOLDEN, CO--(Marketwire - May 31, 2012) - Golden Minerals Company ("Golden Minerals" or the "Company") (NYSE MKT: AUMN) (NYSE Amex: AUMN) (TSX: AUM) is pleased to announce the sale of the Company's 1% net smelter royalty interest in the Platosa property to Excellon Resources Inc. ("Excellon") for US$2.4 million. The Platosa property, which is located north of Torreon, Mexico, is a silver, lead and zinc mine owned by Excellon. At current metal prices, the Company was realizing approximately $400,000 per year in royalty payments. Closing of the transaction is anticipated within thirty days with an effective date of June 1, 2012.
Additionally, Golden Minerals has engaged Canaccord Genuity to solicit purchasers for the Company's land package in the Zacatecas mining district just north of the city of Zacatecas, Mexico. Golden Minerals controls approximately 15,000 hectares of mining claims in the district containing key portions of recognized vein systems. A data room for prospective buyers will be open in June. Interested parties are asked to contact Craig Warren, Managing Director - Investment Banking -- Canaccord Genuity, at (416) 869-7316.
The Company also announced other progress toward the overall rationalization of Golden Minerals' exploration portfolio. In Mexico, in addition to the engagement of Canaccord Genuity for the Zacatecas package and the sale of the Platosa royalty, the Company has closed its regional exploration office in Guadalajara along with commensurate reductions in staff. Approximately 21,000 hectares of properties have been optioned to other companies and an additional 54,000 hectares will be dropped by July 1. In Peru, the Company has farmed out the Palca property in Puno with the counterparty entitled to earn 60% over a three year period by spending $2.5 million. The Company avoided a $1.0 million property payment by returning the Cochabamba property to the vendor as drilling did not produce results that warranted taking the project forward. Staff reductions in Argentina have reduced an additional $500,000 per year of ongoing expense.
Jeffrey Clevenger, Chairman, President and CEO, commented, "Our agreement with Excellon is step two in our exploration rationalization program. We previously announced that Golden Tag, our partner at the San Diego property in Durango State, Mexico, would carry the cost of moving that project forward. We will have more to report about our exploration activity as the year progresses and we are pleased with our efforts to date with the objective of establishing Golden Minerals as an internally funded entity."
About Golden Minerals
Golden Minerals is a Delaware corporation based in Golden, Colorado, primarily engaged in the ramp-up and expansion of existing production at the Velardeña Operations in Mexico and advancement of the evaluation stage El Quevar project in Argentina.
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