Gold Resource Corporation Announces Intent to Create Two Independent, Strategically-Focused Companies with Nevada Mining Unit Spin-Off to Shareholders - Seite 2

Mr. Reid continued, “By separating the mining units into two independent companies, each focused on its own unique business strategy, we believe we can provide our shareholders optionality of increased growth in Mexico and potential for a dividend yield-play in Nevada.  Independent companies allow for far more effectiveness of these distinct business strategies. We believe far greater value can be created with two independent companies compared to the value that could be achieved by keeping the mining units together.” 

Benefits of Stand-Alone Oaxaca Mining Unit 

The Oaxaca Mining Unit celebrated a milestone earlier this year, completing ten years of commercial production with over $1 billion in revenue and $114 million in dividend distributions.  Going forward, the Company’s business strategy for Mexico targets allocating more of its cash flow and capital back into operations to better facilitate growth.  A stand-alone Oaxaca-focused company would be able to aggressively pursue expanding and discovering new vein systems.  The Company is currently developing two dedicated exploration drifts at its Arista Mine to access and target extensions of known vein systems and discoveries of new veins in areas of the mine previously unexplored.  Exploration goals following the separation would include increased exploration budgets for the Arista Mine expansion, and to identify and define additional resource potential in the highly-prospective but under-explored 55-kilometer fault corridor. To date, the Company has drilled approximately 2% of its 560 square kilometer land package in Oaxaca.  The strategy going forward is to allocate more capital to exploration for growth potential, accelerating increased shareholder value.  

The Company has recently completed a power grid project and a paste fill plant and is currently constructing a dry-stack tailings facility.  A stand-alone Oaxaca Mining Unit would be in a strong position to further optimize the Arista underground mine’s infrastructure, including an underground ore pass and surface processing facilities including regrind circuits for increased gold recoveries.  The Oaxaca Mining Unit could also target to utilize its free cash flow for new accretive regional acquisitions.