Fortuna sells San Jose mine to Peru’s JRC Ingeniería
Canadian miner Fortuna Mining has completed the sale of its 100% interest in Compañía Minera Cuzcatlan, owner of the San Jose silver mine in Oaxaca, Mexico, to Peruvian firm JRC Ingeniería y Construcción in a deal worth up to $16-million.
The transaction closed concurrently with the signing of a definitive share purchase agreement, under which JRC will pay Fortuna $6.5-million upfront, plus about $1.2-million for pre-paid working capital items and tax receivables by the end of April. An additional $8.3-million is contingent on meeting certain conditions.
Fortuna will also retain a 1% net smelter royalty (NSR) on future production from the San Jose mine. The royalty becomes payable after the extraction of 6.1-million ounces of silver and 44 000 oz of gold, or 119 000 gold-equivalent ounces.
Once a top-12 global primary silver producer, the San Jose mine was placed on care and maintenance in December last year, owing to rising operating costs and depleted mineral reserves. Although a small mineral resource inventory remains, it no longer meets Fortuna’s reserve classification criteria.
“This transaction is part of our ongoing strategy to streamline the portfolio and focus on core assets,” Fortuna said.
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