ECR Minerals sells Argentina subsidiary Ochre

Precious metals exploration and development company ECR Minerals announced the sale of its wholly-owned Argentina subsidiary Ochre Mining, it announced on Wednesday, which holds the SLM gold project in La Rioja, Argentina.

The AIM-traded firm said it retained a net smelter return royalty of up to 2%, to a maximum of $2.7m, in respect of future production from the SLM gold project.

It said the purchaser, Hanaq Argentina, is a Chinese-owned company engaged in lithium, base and precious metals exploration in north west Argentina, including Salta, Jujuy and La Rioja, with a “highly experienced” management team.

The sale would allow ECR to focus on its core gold exploration activities in Australia, the board said.

“We are pleased to retain exposure to potential upside from the SLM gold project in the form of a royalty on future production, and we believe that Hanaq has the operational capabilities and access to Chinese investment capital necessary to put the SLM project into production, subject to the usual prerequisites,” said chief executive officer Craig Brown.

“Moreover, the transaction enables ECR to concentrate its resources on our core gold exploration activities in Australia.”

At 1510 GMT, shares in ECR Minerals were up 4% at 0.65p.