#Chile #Red Metal #Vallenar #CMS Catalina #Irene Margarita

Red Metal Resources Enters Into New Leasing Agreement for Copper-Gold Concessions

Overview
On August 12, 2026, Red Metal Resources Ltd. announced a strategic partnership with Construcción Minería y Servicios Catalina Ltda. (CMS Catalina), a local artisanal mining firm based in Vallenar, Chile. This partnership allows CMS Catalina to lease the Irene and Margarita mineral concessions, which are situated approximately 15 kilometers east of Vallenar in Chile’s Atacama Region. This agreement encompasses a renewable five-year lease, representing a significant step for Red Metal in leveraging its mineral assets while supporting local mining labor.

Details of the Agreement
The Irene and Margarita concessions cover about 106 hectares and provide an opportunity for CMS Catalina to extract valuable copper and gold resources. Under the lease terms, CMS Catalina will pay Red Metal a 10% royalty on the gross value of all minerals extracted, with a guaranteed minimum payment of $1,000 per month starting from the third month of production. Following a three-month grace period, production is expected to ramp up to a minimum of 2,500 tonnes per month.

Caitlin Jeffs, President and CEO of Red Metal, expressed enthusiasm for the agreement, highlighting its potential to generate reliable royalty revenue while empowering local miners. “This lease introduces a second small-scale mining agreement into our portfolio in Chile, generating immediate cash flow and supporting experienced local miners in the Vallenar district,” Jeffs stated.

Production Expectations
During the initial three-month grace period, CMS Catalina will focus on obtaining necessary permits for production, setting up an explosives storage facility, and preparing a comprehensive exploitation and closure plan for the site. CMS Catalina will work on upgrading road access to enhance logistical efficiency. Upon successful completion of this grace period, mineral extraction is projected to follow a defined growth trajectory. Initial deliveries are expected to start with 1,000 tonnes in the first month, increasing to 1,500 tonnes by the second month, and stabilizing at a minimum of 2,500 tonnes from the third month onwards.

Background on the Irene-Margarita Property
The Irene-Margarita property has been part of Red Metal’s portfolio since 2009. Historical exploration activity revealed promising mineralization, with historical reports from 1994 citing the mining of around 16,144 tonnes of rock with significant copper, silver, and gold concentrations. Recent data suggests that prior mining operations successfully extracted 53.8 tonnes of copper from 3,219 dry tonnes of ore, indicating the property’s productive potential.

Future Plans
Moving forward, Red Metal intends to complete an induced polarization (IP) survey over the northern block of its Carrizal Property to refine drill targets while simultaneously assisting small-scale miners in establishing their production operations at Carrizal. As these efforts unfold, Red Metal remains committed to exploring the Irene and Margarita concessions, thus ensuring that it realizes value from both lease and exploration activities.

Conclusion
In conclusion, this strategic partnership between Red Metal and CMS Catalina showcases Red Metal's commitment to sustainable mining practices and local economic support. By harnessing local expertise and generating royalties from the mining of its concessions, Red Metal positions itself not only as a responsible player in the mining sector but also plays a crucial role in the empowerment of local artisanal miners. This agreement signifies a positive step forward for both parties in the vibrant mining landscape of Chile.

Cautionary Note
It's important to note that while CMS Catalina is responsible for the mining operations under this lease agreement, Red Metal is not the operator. The company’s reliance on historical production records and the absence of a feasibility study for the current mineral resources mean there's inherent risk involved in the projections made. Stakeholders are cautioned to consider these aspects in context with the forward-looking statements through Red Metal’s ongoing reporting and updates.