Heliostar Closes On $5 Million Purchase Of Producing Mexican Assets
Heliostar Metals (TSXV: HSTR) is now officially a producer. The company has as of today closed on multiple assets in Florida, following the closing of a transaction with Florida Canyon Gold (TSXV: FCGV).
The transaction saw Heliostar acquire the San Agustin mine, the La Colorada mine, the Cerro del Gallo project, and the San Antonio project, all as part of a cash transaction valued at US$5 million. As part of the arrangement, US$20 million in contingent payments that were payable to Florida Canyon related to Ana Paula were also eliminated, along with US$150 million in conditional option payments and a 2% NSR on the San Antonio project.
The assets acquired, which comprise of the former Argonaut Gold assets in Mexico prior to its acquisition and subsequent spinout by Alamos Gold, consist of two producing mines as well as two development projects. At San Agustin, gold is currently being produced via an open pit heap leach operation, producing 7,568 ounces of gold and 39,319 ounces of silver in the first quarter of 2024. The asset contains probable mineral reserves of 197,000 ounces of gold and 6.7 million ounces of silver.
READ: Heliostar Metals Secures $10M in Debt Facilities to Fund Mexican Gold Asset Acquisition
At La Colorada, Q1 production totaled 3,922 ounces of gold and 6,848 ounces of silver, which was produced via residual leaching of gold while on care and maintenance. Probable reserves amount to 383,000 ounces of gold and 5.1 million ounces of silver across two deposits, with permits currently in the process of being obtained.
Other assets acquired include the San Antonio project, with a resource of 1.7 million ounces of gold measured and indicated and 67,000 ounces of gold inferred, and the Cerro del Gallo project, which is a gold-silver development project with historical proven and probable reserves of 1.6 million ounces of gold and 39.0 million ounces of silver.
“Through the acquisition of this portfolio, Heliostar has unhedged gold production from multiple assets and strong pipeline for production growth. The combination of production, production growth, resource expansion and the removal of the US$20 million in milestone payments from Ana Paula establishes Heliostar as a dynamic growth company in 2025 and beyond. With the Transaction closed, the Company expects to provide 2024 production guidance and present expansion plans of the La Colorada mine in the coming weeks,” commented Charles Funk, CEO of Heliostar.
Heliostar Metals last traded at $0.56 on the TSX Venture.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.
