Solitario Resources - Newmont Mining Amend Yanacocha Royalty Structure and Work Commitment

• Published in: Business Wire p. 1
• Format: Newsletter
• Language: English
• Published: New York Business Wire 22.11.2004
• Subjects: Agreements; Copper; Gold; Mining; Stock exchanges; DENVER

Solitario Resources Corporation ("Solitario") and Minera Los Tapados S.A., a subsidiary of Newmont Peru Limited, Minera Yanacocha S.R.L., and Minera Chaupiloma Dos de Cajamarca, S.R.L. (collectively "Tapados,"), signed a Letter of Intent to amend Solitario's net smelter return ("NSR") royalty on a 150,000-acre property located immediately north of Newmont Mining-Buenaventura's Minera Yanacocha Mine, the largest gold mine in South America. In addition to amending the NSR royalty, the Letter Agreement commits Tapados to a long-term US$4.0 million work commitment on Solitario's royalty property and provides Solitario access to Tapados' future exploration results on an annual basis. The royalty amendment and the work commitment are subject to the companies signing a definitive agreement and various regulatory approvals. Chris Herald, president and CEO of Solitario, stated, "With this agreement Solitario will benefit from a structured long-term US$4.0 million work commitment on this large, strategically located royalty position. In addition, we now have access to exploration results on an annual basis. We also recognized that the new Peruvian government royalty added on top of Solitario's royalty imposed an economically unfavorable burden to Minera Yanacocha in terms of justifying advancing exploration and development on Solitario's royalty property." --Heap leach ores: For gold recovered by heap leach processing, the lesser of the sliding scale royalty set out below (the "Base Rate"), or a royalty such that the royalty to Solitario plus any government royalty required to be paid in Peru is no more than 5.25% NSR unless the gold price is greater than $500 per ounce, in which case then a royalty such that the royalty to Solitario plus any royalty due to the government is no more than 5.75% NSR.