Dear shareholders
I am writing from a hospital bed where unfortunately I have landed after a bout of Covid and Pneumonia in Peru in June. I apologise for the delay in having our first AGM but my illness and waiting to finalize the sale of some of Chala’s assets are the cause.
In that regard, the negotiations with Raya Minerals for the purchase of AMP1 and our drilling permits advanced to the stage of lawyers exchanging draft contracts before the purchaser, represented by Mr Luis Goyzueta, unilaterally decided to renegotiate the price three weeks ago. He has subsequently failed to make a counter offer to the price of US$2.17 Million which had previously been agreed.
Your Board subsequently regards this sale as now unlikely to proceed. The legal bills in relation to this transaction will be about A$10,000.
The financial situation of the company is that it now relies on loan funds from me to remain solvent. In this regard I propose to advance sufficient funds for the following purposes against a formal loan document.
1. Pay legal fees for the aborted Raya Minerals purchase
2. Pay holding costs of CML
3. Complete the purchase of new concessions UCM1 and UCM 2 ( 1500 Ha highly prospective for Cu, Au, Ag )
4. Collect and assay a minimum of 200 sub-surface samples from areas within these concessions as identified by our consultant Geologist Jacob Rebek
5. Associated legal and other costs in Peru
The quantum of these costs is expected to be around A$100,000.
This exploration work will be completed by April-May 2023 at which time a decision can be taken whether to try to sell, JV or develop the minerals identified. Listing of Chala may still be an option if the grades of mineral discovered are sufficiently high.
We take this opportunity to thanks Geoff Muers, Jacob Rebek and Kenneth Leo for their contribution as shareholders and foundation Directors to the company and look forward to being able to work with them in the future once we know the results of the 2023 exploration on the new tenements.
I wish you all a happy and healthy and prosperous holiday season.”