Comstock Mining Announces Third Quarter 2019 Results; Positive Q3 Net Income, Record Lowest Costs and Continued Debt Reduction

VIRGINIA CITY, NV - Comstock Mining Inc. reported that during 2019, the company and Comstock Processing LLC, the wholly-owned subsidiary that owns all of the property, plant, equipment and permits for the Crushing, Agglomerating, Leaching, Merrill Crowe Processing, Mercury Retort, Refining and Metallurgical operations located at 1200 American Flat, Virginia City, entered into a definitive agreement with Mercury Clean Up LLC (MCU), in collaboration with Oro Industries Inc., for the manufacture and global deployment of mercury remediation systems with proprietary mechanical, hydro, electro-chemical and oxidation processes to reclaim, treat and remediate mercury from soils, waste and tailings.  

MCU has the exclusive, world-wide rights to four patentable technologies and equipment that we believe will demonstrate feasible, economic mercury remediation. Comstock provides the platform for testing the mercury remediation system, and MCU will conduct the trials that prove scalable feasibility. MCU plans to deploy the solution globally and is working on at least one major, international remediation project.  

For the Dayton resource in Lyon County, Nevada, Comstock discovered a newly recognized, mineralized, cross-cutting shear zone. An assay sample of the material identified three feet of 0.246 ounces per ton (OPT) gold and 3.553 OPT silver. Sampling was expanded and exposed another 90.8 feet of mineralized shear zone, beginning deep inside the Dayton adit. This overall sampling program identified precious metals averaging 0.043 OPT gold and 0.404 OPT silver for the entire zone, including 7.5 feet averaging 0.121 OPT gold and 0.753 OPT silver. The Company is proceeding to publish a separate NI 43-101 compliant, updated technical report for the Dayton resource that supports the subsequent scope of publishing a Preliminary Economic Assessment (PEA) for the Dayton project.

The Company is also continuing its exploration activities southerly into Spring Valley, south of Silver City, Nevada, with plans for incremental exploration programs that include exploration and definition drilling of targets identified by geophysical surveys, surface mapping, prior drilling and deeper geological interpretations that together are expected to lead to publishing an updated, NI 43-101 compliant, mineral resource estimate for the Dayton Project and the expanded opportunities.

Tonogold has commenced further analysis of our northern targets that we believe is extraordinary, correlating historical data with modern geological assessments and creating a larger exploration opportunity.  Accordingly, the Company signed a new mineral lease with Tonogold that commits Tonogold to a minimum of $5 million towards the exploration of Comstock’s northern mineral claims and an additional minimum of $5 million for exploration and economic feasibility development, while eliminating the Company’s related maintenance costs and retaining the Company’s rights to a 1.5-3.0% NSR royalty. The Company believes this will accelerate the development of its northern targets and enhance the value of its mineral property portfolio and royalty package.

Comstock’s collaborative efforts with Tonogold have evolved extensively during 2019, resulting in an enhanced sales agreement that immediately values Lucerne Resource Area in Nevada, at more than $24 million ($11.5 million in cash, $5.5 million in stock and over $7 million in assumed liabilities) plus a 1.5% NSR royalty on Lucerne’s future production while already delivering over $2 million in annualized savings.  The Company has received non-refundable cash deposits of $4.25 million through October 28, 2019.  The Company’s recent agreement requires additional cash payments at closing of $3.325 million, bringing total cash payments to over $7.5 million, providing Tonogold a majority membership interest of 50.3% in Comstock Mining LLC. The remaining $3.95 million in cash owed represents a secured obligation of Tonogold with scheduled monthly payments of at least $650 thousand each due starting in January 2020, through June 2020. Once fully paid, Tonogold will own 100% of Comstock Mining LLC. 

Corrado De Gasperis, Executive Chairman and CEO said, “Our focus on realigning and transforming the Company and its balance sheet is finally coming to fruition. We have now received over $4.25 million in non-refundable cash deposits and $5 million in stated stock for the Lucerne sale, signed new agreements to sell our Silver Springs properties for over $10 million and launched a globally-focused mercury remediation business with world-class technology and experience all while continuing to lower our net operating costs.”

The company’s address is P.O. Box 1118, Virginia City, NV 89440, (775) 847-5272, comstockmining.com.