Coro signs LOI to acquire 65% of Planta Prat plant

Aug 12, 2014

CORO SIGNS LETTER OF INTENT TO ACQUIRE SMALL SXEW PLANT

Coro Mining Corp. has signed a letter of intent (LOI) with a local private company, SCM Compania Minera Constanza, to acquire an interest in the Planta Prat which comprises a small SX/EW (solvent extraction and electrowinning) plant designed to treat old leach residues located close to the city of Antofagasta in the II region of northern Chile.

Alan Stephens, president and chief executive officer of Coro, commented: “We are very pleased to have identified and agreed to acquire an interest in Planta Prat on very favourable terms. Subject to the results of our due diligence sampling and metallurgical testwork, we anticipate putting it back into production quickly and cheaply; it will provide a new source of cash flow to the company at a low acquisition cost and, we believe, with an excellent rate of return. Coro also views the acquisition of an interest in Planta Prat as a first step in the establishment of a larger district-wide business.”

About Planta Prat

Located 33 kilometres northeast of the city of Antofagasta, Planta Prat comprises a small SX/EW agitation leach plant built in 2009 to treat old leach residues derived from a precipitation plant that operated in the nearby Mantos Blancos mine several decades ago. The Prat plant failed to operate efficiently due to buildup of iron sulphate and closed after a few months of operation. Based on positive initial agitation leach testwork carried out by the company’s consultants, ProTech SA, Coro believes that this issue can be readily resolved, and intends to complete further testwork to confirm this during its 120-day due diligence period, which will also include backhoe sampling of the residues.

The agreed purchase terms for Coro to own a 65-per-cent interest are as follows:

$10,000 payment on signature of LOI (paid);
$40,000 payment on Feb. 6, 2015;
$100,000 payment on formation of Newco (51 per cent Coro) on completion of expansion of the Prat plant to 1,200-tonne-per-day copper capacity by Aug. 6, 2017, at Coro’s cost;
Additional 14-per-cent interest in Newco earned by Coro upon commencement of commercial production (80 per cent of 1,200-tonne-per-day copper annual production rate for 60 consecutive days);
First right of refusal over Constanza’s interest.

Constanza owns some of the leach residues and intends to gain access to the rest. Coro and Constanza have also identified additional deposits in the area which can be potentially treated by Planta Prat, and intend to acquire them.

http://www.coromining.com/s/newsreleases.asp