Riverside Resources (RRI.V) has been active in Mexico’s Sonora state as the company recently signed an option agreement to acquire full ownership in the Union mine. That’s a past producing mine where CRD mineralization was mined resulting in the production of gold, silver and zinc. Historical records indicate the total documented gold production was approximately 50,000 ounces from material mined at the upper oxide zones of the manto and chimney bodies. As these historical mining activities seem to have focused on the oxide-hosted mineralization, Riverside thinks there is potential to further expand the mineralized zones along strike and at depth to discover more oxide targets but also to find more sulfide-hosted targets.
The Union mine was the last piece of the puzzle of the Union project which surrounded this key inlier license that hosts the actual mine. And fortunately for Riverside, the acquisition terms are actually quite attractive. The company paid US$170,0000 in cash and an additional cash payment of US$100,000 will allow the company to take full control of the license, subject to issuing a 1.25% Net Smelter Royalty to the current owner of the license. That royalty can be entirely repurchased in 0.25% increments for US$250,000 per increment (so it would cost Riverside US$1.25M to repurchase the entire 1.25% NSR if it ever wants to do so).
Riverside isn’t wasting any time and has started the process to obtain drill permits for the enlarged Union project and hopefully the company will be able to drill this interesting project later this year.
Disclosure: The author has a small long position in Riverside Resources. Please read our disclaimer.
