Comstock Mining Inc. (the “Company”) (NYSE American: LODE) today
announced progress on a number of strategic initiatives and
corporate activities.
Corporate Realignment During the first quarter
of 2019, the Company’s Board of Directors approved the sale of the
Lucerne mine and a strategy focused on high-value, high
cash-generating, precious metal-based activities, (the “Strategic
Focus”) including, but not limited to, metals exploration,
engineering, resource development, economic feasibility
assessments, mineral production, metal processing and related
supply chain acquisitions and ventures for
environmentally-friendly, conservation-based, economically
enhancing mining technologies and processes. The Company has
now completed the realignment such that all of the Lucerne
properties are now wholly owned or controlled by Comstock Mining
LLC, the entity that Tonogold Resources Inc. (“Tonogold”) will
acquire in purchasing the Lucerne properties.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/41e725c6-b0b4-442a-855f-1c83c4d9467d
Comstock Mining Inc. is the parent company that wholly owns the
realigned subsidiaries. Comstock Mining LLC owns or controls
Lucerne properties, including those contained in Northern Comstock
Joint Venture. Comstock Northern Exploration LLC owns or controls
the remaining Storey County mining claims and exploration targets,
primarily located north of Lucerne, including the Gold Hill targets
and the Occidental Lode. Comstock Exploration & Development LLC
owns or controls the Lyon County mining claims and exploration
targets, including the Dayton and Spring Valley resource areas.
Comstock Processing LLC owns the American Flat processing facility
and additional lands for multiple, potential expansions. Comstock
Industrial LLC owns the Silver Springs properties and water rights.
Comstock Real Estate Inc. owns the Gold Hill Hotel and the Daney
Ranch. Comstock Mercury Remediation LLC is the newly agreed upon
50-50 joint venture.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/2e582567-4d58-4eb5-b1c8-b30837bd3887
Business Update Tonogold recently accelerated,
and the Company has received, $3.92 million in non-refundable
Convertible Preferred Stock. The $3.92 million ultimately converts
at a price being the lowest of Tonogold’s (1) 20-day volume
weighted closing price prior to conversion, (2) most recent private
placement, or (3) initial public offering price. Comstock
Processing LLC, a new wholly owned subsidiary of the Company that
includes all of the assets at the American Flat campus, including
crushing, leaching, Merrill-Crowe metallurgical processing and the
Company’s various metallurgical laboratories, has pursued, and the
Board has approved, the formation of a Joint Venture with Mercury
Clean Up LLC (“MCU”), with proprietary technology for placer mining
gold and silver bearing materials containing mercury. The
Company expects to finalize the terms of the Joint Venture this
month and announce the details. The Company will form another
entity called Comstock Mercury Remediation LLC, or a similar name,
that will represent the actual 50-50 Joint Venture, with final
proof of concept, mining and remediation occurring on the Comstock.
The Company will also own a direct stake in MCU. Mr. Corrado De
Gasperis, Executive Chairman and CEO stated, “Our strategic
initiatives are all moving forward on plan, with Tonogold expecting
to close on or before August 30, eliminating our debenture and
accelerating the deployment of our strategic growth plans,
including partnering with MCU in a new mining and remediation
business. We look forward to announcing the specifics of this
opportunity, both here in the U.S. and globally, for
commercializing the only U.S. government-approved, feasible,
mercury-remediating and recovery system.” Recent Favorable
Court Rulings The Company previously announced, and has
included in today’s first quarter Form 10-Q filing, that on May 14,
2019, the Third Judicial District Court of the State of Nevada
ruled in favor of the Company and Lyon County on the one remaining
Due Process rights claim associated with the Lyon County Board of
Commissioners Master Plan amendment and zone change associated with
certain mineralized properties within the Company’s Dayton Resource
Area, just south of the Company’s Lucerne properties and near
Silver City, Nevada. In addition, on May 21, 2019, the First
Judicial District Court of the State of Nevada, in and for Storey
County, favorably granted us our Motion for the Plaintiff to file a
“more definite statement.” Precious refiled their complaint on June
5, 2019. The Company believes that the Precious claims are
completely without merit. Reclamation The Nevada
Division of Environmental Protection’s (NDEP) Bureau of Mining
Regulation and Reclamation (BMRR) approved a reduction in the
Company’s Lucerne reclamation bonding requirement from several
successful environmental reclamation and restoration efforts. Along
State Route (SR) 342, just south of Gold Hill, Nevada, the Company
also completed a variety of reclamation and/or environmental
restorations, using progressive earthwork.
Mr. De Gasperis stated, “This restoration work was performed
concurrently with mining from 2013 through 2015, and our
reclamations were innovative, timely, efficient and especially
effective for the regrading and revegetation efforts. The current
reclamation obligation has been reduced down to $6.75 million from
over $7.10 million.”
In 2015 and 2017, the Company received Nevada Excellence in Mine
Reclamation Awards from a committee comprised of NDEP’s BMRR,
Nevada Division of Minerals, Nevada Department of Wildlife, Bureau
of Land Management (BLM) Nevada, and the U.S. Forest Service. In
2018, the Company also received the U.S. Department of the Interior
BLM’s Reclamation and Sustainable Mineral Development Award.
Outlook The Company’s annual operating expenses
are planned at $3.8 million, and effective June 1, 2019,
approximately $2.2 million of that amount, prospectively, is being
reimbursed under the existing Tonogold Option Agreement and the new
Tonogold agreement to purchase Lucerne, resulting in more than $1
million in additional, annualized savings. The transaction to
purchase the Lucerne properties is expected to close on or before
August 30, and the Company expects to receive an additional
non-refundable deposit this month. The Company’s second half 2019
plans include advancing the commercialization of certain mining and
processing technologies that the Company has been collaborating on,
with new partners such as MCU and Oro Industries Inc., and others,
and includes reclamation and enhanced mineral recoveries that
present nearer term revenue opportunities for us and potentially
enhance the economic feasibilities of our existing
properties.
The Company expects to close on the sale of the Silver Springs
properties this summer, likely on or before September, 2019, for
total net proceeds of over $10 million, in addition to the over $9
million in total remaining net cash proceeds from the sale of
Lucerne remaining, expected on or before August 30, 2019.
The Dayton resource area, south of Virginia City in Lyon County,
Nevada, ranks as the Company’s top exploration and mine development
target. The Company is developing a completely new geological
interpretation that will be used for a new resource estimate. The
new geological interpretation is also being used to design phased
drilling programs in with high-potential for additional mineral
resources. Multiple layout plans for the mine and corresponding
processing facilities have been conceptually developed and located
on lands 100% privately held by the Company, thus simplifying and
shortening the critical permitting chain. The Company plans to
issue a new, stand-alone Dayton resource technical report, followed
by a preliminary economic assessment.
The Company also expects to announce additional ventures and
alliances, all designed for profitable revenue growth, during the
third and fourth quarters of 2019. The ventures and our strategic
partners will be showcased during our annual meeting, planned for
September 2019, at the Gold Hill Hotel in Gold Hill, Nevada.
Mr. De Gasperis concluded, “We are pleased to report that we are
filing our first quarter financial statements on Form 10-Q with the
SEC today. It contains all of the recent Tonogold transactions and
the updates from our favorable court rulings. There were no changes
in any of the financial statements as compared to what was released
on May 15, 2019. We truly appreciate everyone’s patience as we
completed an exhaustive financial accounting and reporting
analysis, the realignment for Lucerne and our Strategic Focus and
updates to the events and transactions that are all included in
this filing. We certainly do not expect any delayed filings in the
future.”
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. 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 near-term goal of
our business plan is to maximize intrinsic stockholder value
realized, per share, by continuing to acquire mineralized and
potentially mineralized properties, exploring, developing and
validating qualified resources and reserves (proven and probable)
that enable the commercial development of our operations through
extended, long-lived mine plans and developments that are
economically feasible and socially responsible.
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: future industry market
conditions; future explorations or acquisitions; future changes in
our exploration activities; future prices and sales of, and demand
for, our products; land entitlements and uses; production capacity
and operations; operating and overhead costs; future capital
expenditures and their impact on us; operational and management
changes (including changes in the board of directors); changes in
business strategies, planning and tactics; 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; including the nature and timing and
accounting for restructuring charges, derivative liabilities and
the impact thereof; contingencies; environmental compliance and
changes in the regulatory environment; offerings, limitations on
sales or offering of equity or debt securities; including asset
sales and the redemption of the debenture 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 this report and
our Annual Report on Form 10-K for the fiscal year ended December
31, 2017, and the following: 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 our
title to properties; potential dilution to our stockholders from
our stock issuances, 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 our businesses;
permitting constraints or delays; business opportunities that may
be presented to, or pursued by, us; acquisitions, joint ventures,
strategic alliances, business combinations, asset sales, and
investments that we may be party to in the future; changes in the
United States or other monetary or fiscal policies or regulations;
interruptions in our 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 our 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; assertion of
claims, lawsuits and proceedings against us; 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 or the solicitation of an offer to buy
the Debenture or any other securities of the Company. Contact
information: Comstock Mining, Inc. P.O. Box 1118 Virginia City, NV
89440
Corrado De Gasperis Executive Chairman & CEO Tel (775)
847-4755 degasperis@comstockmining.com Zach Spencer Director of
External Relations Tel (775) 847-5272 ext.151
questions@comstockmining.com
Comstock (AMEX:LODE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Comstock (AMEX:LODE)
Historical Stock Chart
From Apr 2023 to Apr 2024