Comstock Mining Inc. (the “Company”) (NYSE American: LODE) and
Comstock Northern Exploration, LLC (“Comstock”), a wholly-owned
subsidiary of the Company, entered into a Mineral Exploration and
Mining Lease Agreement (the “Lease”) with the Sutro Tunnel Company
(“Sutro”), in order to lease certain patented mining claims,
exploration rights and town lots in the Gold Hill and Virginia City
Mining District in Storey County, Nevada (collectively, the “Sutro
Properties”). The Company previously had exclusive rights to
explore and mine these same properties and mineral claims beginning
in 2008.
The Lease is assignable by Comstock and these properties make up
part of the Lucerne mine properties and part of the Mineral
Exploration lease with Tonogold Resources Inc. (“Tonogold”).
Tonogold is a strategic partner and investee of the Company, and
they recently announced the commencement of an initial and major
exploration and evaluation of Comstock Lode properties including
the Occidental Lode, the Lucerne and many of the most historic
bonanza’s including but not limited to the Collar Potosi, Belcher,
Overman, Gould & Curry, Consolidated Imperial, Woodville, Crown
Point and Yellow Jacket mineral properties, where historic
production recovered over 8 million ounces of gold and almost 200
million ounces of silver. The Company has preferred shares
convertible to 33.2 million Tonogold common shares.
Tonogold has also announced that it recently completed a $4.25
million equity capital raise, over $6 million in cash and an
additional $3.5 million in drilling equity credit, fully funding an
estimated $7 million initial drill program, in one of the most
historically significant portions of the Comstock Lode.
Tonogold’s initial drill program will focus on the nearly 2-mile
mineralized strike where most of the historical production came
from above approximately 1,600 feet in depth, where more favorable
mining conditions were enabled by the dewatering of the Sutro
Tunnel. Tonogold has conducted extensive research and uncovered
mining reports and data that indicate significant potential for
higher grade discoveries, at depths consistent with and below 1,600
feet.
The Lease has a term of up to 20 years or longer, with a 4% net
smelter royalty payable to Sutro. The Sutro Tunnel Company is a
wholly-owned subsidiary of Pelen Limited Liability Company
(“Pelen”). The Company previously acquired and owns 25% of
the outstanding equity of Pelen. In connection with entering into
the long-lived Lease, the Company purchased an option (the
“Option”) to acquire the remaining 75% of the equity of Pelen (the
“Pelen Equity”). The Option has a term of up to three years.
The Option is exercisable so long as the Company makes payments of
$100,000 per year ($100,000 of which was paid by the Company upon
signing the Option). Pursuant to the Option, the Company is
entitled to purchase the Pelen Equity for $3,750,000 if exercised
within one year, with an increasing purchase price for the second
and third years, with half of the option payments being
cumulatively applicable to the purchase price.
Mr. Corrado De Gasperis, Executive Chairman and CEO stated, “Our
collaboration with Tonogold has expanded from their initial
purchase of Lucerne, that we anticipate completing in the near
term, to an expansive exploration drilling program targeting some
of the highest grade sections of the Comstock Lode. We remain
an owner, investor and royalty holder, and we very much look
forward to the exploration results over the next few months and
well into next year. There is a genuine sense of excitement
seeing these rigs mobilized and drilling on the Comstock.”
About Comstock Mining Inc.
Comstock Mining Inc. is a Nevada-based, gold and silver mining
company with extensive, contiguous property in the Comstock
District and is an emerging leader in sustainable, responsible
mining that is currently commercializing environment-enhancing,
precious-metal-based technologies, products and processes for
precious metal recovery. The Company began acquiring properties in
the Comstock District in 2003. Since then, the Company has
consolidated a significant portion of the Comstock District,
amassed the single largest known repository of historical and
current geological data on the Comstock region, secured permits,
built an infrastructure and completed its first phase of
production. The Company continues evaluating and acquiring
properties inside and outside the district expanding its footprint
and exploring all of our existing and prospective opportunities for
further exploration, development and mining. The Company’s goal is
to grow per-share value by commercializing environment-enhancing,
precious-metal-based products and processes that generate
predictable cash flow (throughput) and increase the long-term
enterprise value of our northern Nevada based platform.
Forward-Looking Statements
This press release and any related calls or discussions may
include forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. All statements,
other than statements of historical facts, are forward-looking
statements. The words “believe,” “expect,” “anticipate,”
“estimate,” “project,” “plan,” “should,” “intend,” “may,” “will,”
“would,” “potential” and similar expressions identify
forward-looking statements, but are not the exclusive means of
doing so. Forward-looking statements include statements about
matters such as: consummation of all pending transactions; project,
asset or Company valuations; future industry market conditions;
future explorations, acquisitions, investments and asset sales;
future performance of and closings under various agreements; future
changes in our exploration activities; future estimated mineral
resources; future prices and sales of, and demand for, our
products; future impacts of land entitlements and uses; future
permitting activities and needs therefor; future production
capacity and operations; future operating and overhead costs;
future capital expenditures and their impact on us; future impacts
of operational and management changes (including changes in the
board of directors); future changes in business strategies,
planning and tactics and impacts of recent or future changes;
future employment and contributions of personnel, including
consultants; future land sales, investments, acquisitions, joint
ventures, strategic alliances, business combinations, operational,
tax, financial and restructuring initiatives; the nature and timing
of and accounting for restructuring charges and derivative
liabilities and the impact thereof; contingencies; future
environmental compliance and changes in the regulatory environment;
future offerings of equity or debt securities; the possible
redemption of debentures and associated costs; future working
capital, costs, revenues, business opportunities, debt levels, cash
flows, margins, earnings and growth. These statements are based on
assumptions and assessments made by our management in light of
their experience and their perception of historical and current
trends, current conditions, possible future developments and other
factors they believe to be appropriate. Forward-looking statements
are not guarantees, representations or warranties and are subject
to risks and uncertainties, many of which are unforeseeable and
beyond our control and could cause actual results, developments and
business decisions to differ materially from those contemplated by
such forward-looking statements. Some of those risks and
uncertainties include the risk factors set forth in our filings
with the SEC and the following: counterparty risks; capital
markets’ valuation and pricing risks; adverse effects of climate
changes or natural disasters; global economic and capital market
uncertainties; the speculative nature of gold or mineral
exploration, including risks of diminishing quantities or grades of
qualified resources; operational or technical difficulties in
connection with exploration or mining activities; contests over
title to properties; potential dilution to our stockholders from
our stock issuances and recapitalization and balance sheet
restructuring activities; potential inability to comply with
applicable government regulations or law; adoption of or changes in
legislation or regulations adversely affecting businesses;
permitting constraints or delays; decisions regarding business
opportunities that may be presented to, or pursued by, us or
others; the impact of, or the non-performance by parties under
agreements relating to, acquisitions, joint ventures, strategic
alliances, business combinations, asset sales, leases, options and
investments to which we may be party; changes in the United States
or other monetary or fiscal policies or regulations; interruptions
in production capabilities due to capital constraints; equipment
failures; fluctuation of prices for gold or certain other
commodities (such as silver, zinc, cyanide, water, diesel fuel and
electricity); changes in generally accepted accounting principles;
adverse effects of terrorism and geopolitical events; potential
inability to implement business strategies; potential inability to
grow revenues; potential inability to attract and retain key
personnel; interruptions in delivery of critical supplies,
equipment and raw materials due to credit or other limitations
imposed by vendors or others; assertion of claims, lawsuits and
proceedings; potential inability to satisfy debt and lease
obligations; potential inability to maintain an effective system of
internal controls over financial reporting; potential inability or
failure to timely file periodic reports with the SEC; potential
inability to list our securities on any securities exchange or
market; inability to maintain the listing of our securities; and
work stoppages or other labor difficulties. Occurrence of such
events or circumstances could have a material adverse effect on our
business, financial condition, results of operations or cash flows
or the market price of our securities. All subsequent written and
oral forward-looking statements by or attributable to us or persons
acting on our behalf are expressly qualified in their entirety by
these factors. Except as may be required by securities or other
law, we undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise. Neither this press release nor any
related calls or discussions constitutes an offer to sell, the
solicitation of an offer to buy or a recommendation with respect to
any securities of the Company, the fund or any other issuer.
Contact information: Comstock Mining, Inc. P.O. Box 1118
Virginia City, NV 89440 ComstockMining.com
Corrado DeGasperis Executive Chairman & CEO Tel (775)
847-4755 degasperis@comstockmining.com Zach Spencer Director of
External Relations Tel (775) 847-5272 ext.151
questionckmining.com
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