AUSTIN, Texas, August 10, 2016 /PRNewswire/ --
Preston Corp (OTCQB: PSNP) ("Preston Corporation" "PSNP" or the "Company") today is pleased to provide further details on the Company's Royalty Purchase Agreement with the previously announced Arizona mine. The project is the West Port Gold Mine located near Quartzite, Arizona and is a fully permitted placer-alluvial gold project, currently in the final stages of mine construction prior to commencing commercial gold production.
The West Port Mine is forecast to process 220,000 tons per year of gold bearing material at a grade of 3 grams per ton resulting in the production of 21,000 ounces of gold per year. EBITDA is forecast at $23.5 million in 2017 and $29.8 million in 2018. The mine life currently has sufficient insitu material to operate at 800 tons per day through 2020. Preston believes that there are excellent opportunities on the existing claim block to find significant additional resources on the project along the gold bearing channel strike and at depth.
Under the terms of the royalty agreement with West Port, Preston has agreed to purchase a royalty interest in the mine for $5,000,000, receiving a contractual 50% annual return on investment.
As previously announced, the West Port Mine is a low cost, high grade placer deposit which has an all-in production cost per ounce of gold of $300 and a calculated AISC (All-In Sustaining Cost) of $466.82. The mine meets all of Preston's requirements for financing and acquisition. Preston anticipates recording revenue from this royalty in Q4 of this year.
Company President Andrew Stack states "the West Port Mine project is exactly the type of investment Preston anticipates making as we grow our business. We are dedicated to investing in low cost, permitted gold projects that meet our target ROI. We will endeavor to continue to update our stakeholders as to the timing and progress of the ramp up towards initial gold sales at the West Port Mine."
About Preston Corp (OTCQB: PSNP)
Preston Royalty's mission is to develop the Company into a leading financial service provider, specializing in royalty financing for mining operations with the intent to realize large, continuous profits from ongoing economic interest in the production and future production of mining properties. Preston Royalty is gold focused but will create a diversified portfolio of royalties and streams wherever the value can be found regardless of commodity, geography, revenue type or stage of project. Preston Royalty is not an operator and therefore has none of the associated risks or capital requirements of mine operation.
Notice Regarding Forward-Looking Statements
This news release contains "forward-looking statements" as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, scope and type of consulting services provided by PSNP, use of proceeds, future acquisitions, success of projects, growth and strategic plans. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with petroleum exploration and development stage exploration companies. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K for the most recent fiscal year, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission.
ON BEHALF OF THE BOARD
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SOURCE Preston Corp