Xali Gold (XGC.V) entered into discussions regarding the potential sale of its El Oro hard-rock interests to companies with operations in Mexico, to focus on advancing its recently acquired Pico Machay gold project in Peru, it said Wednesday.
The company believes that there is "excellent potential" for discoveries and revenues from its various El Oro projects, but that delays experienced to date reduced their strategic priority relative to the Pico Machay Gold project. Xali Gold's unit, Minera CCM S.A. de C.V., has a tax loss carry forward of about $3.04 million, which the company believes could potentially be useful to operational entities, in addition to the mineral exploration potential.
The gold and silver exploration company is also considering, alternatively, a "significant" reduction to the size of its El Oro property position and the associated mineral rights fees.
At the El Oro Hard Rock project, the company said it accepts and does not intend to challenge the cancellation of two additional claims, representing hard-rock mineral rights, by the Mexican Mines Bureau without the legally required 60-day notice being provided directly to the company.
In regard to the El Oro Tailings project, the company believes a portion of the tailings may have been removed from the site by another party claiming to be Minera CCM. Xali Gold said it is working with Kappes, Cassiday & Associates and its advisors to determine what occurred.
Shares of the company closed unchanged at CA$0.215 on Tuesday on the TSX Venture Exchange.