Validity Fees and Penalties over propertiesHolding mining properties in a long term is like a tax planning. If you do not have an strategy in your business the overcost would be perverse. You can overpay in the long run for properties with no value.
The annual validity fee is US$3.00 per hectare.
The annual Penalty to be paid after year 7 is US$6.00 per hectare and looks to impede the title holders to hold properties in a long term without investments. After year 12, the Penalty increases to US$20 per hectare and gradually increases every year. If exploration expenses are incurred during the previous year, the annual Penalty does not applies. That means that is not a good deal to hold properties in the long term without investment.
In case of OCACASA 4, of 1,000 hectares, the property was granted by INGEMMET in July 2005, so its been 14 years since the property was granted. A penalty of US$25 per hectare is applicable to this property in 2019 as seems no investment was done in 2018. Thats equal to S/.83,000.00 or US$25,000.00. The amount invested in each property is declared to the Mining entity each year.
Also, INGEMMET shows that Validity Fee (Derecho de Vigencia) for years 2017 and 2018 of OCACASA 4 were not paid in due time. Mining Council will tell us the truth soon.
https://www.ingemmet.gob.pe/igm-sidemcat-portlet/ver-penalidad?pCodigo_DM=010215005 I think either Mining Council rules in favour or against PLU, it should require a PR as I think this is a Material Event considering that 32 properties are involved under litigation and 4 main targets under risk.
Still, by June 30, 2019, the Right of Validity (and penalties if applicable) on the total properties (93,000 hectares) has to be paid in order to keep all in good standing. So hope Validity Fees and Penalties of the properties for the year 2019 are already fully paid and PLU dont waits again until last minute.