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Commitments and Contingencies
 12 Months Ended
Dec. 31, 2016
Commitments and Contingencies  
Commitments and Contingencies

20.Commitments and Contingencies

 

Leases and Purchase Commitments

 

The Company has non-cancelable operating lease commitments as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

2017

    

2018

    

2019

    

2020

    

2021

    

Thereafter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

El Quevar mining concessions (estimated)

 

$
115

 

$
115

 

$
115

 

$
115

 

$
115

 

$

—

 

Velardeña mining concessions (estimated)

 

$
75

 

$
75

 

$
75

 

$
75

 

$
75

 

$

—

 

Office space

 

$
284

 

$
293

 

$
272

 

$

 —

 

$

 —

 

$

—

 

 

The Company is required to make payments to the Argentine government to maintain its rights to the El Quevar mining concessions. The Company has made such payments totaling approximately $112,000 and $40,000 for the years ended December 31, 2016 and 2015, respectively.

 

The Company is required to pay concession holding fees to the Mexican government to maintain its rights to the Velardeña Properties mining concessions. During the years ended December 31, 2016 and 2015 the Company made such payments totaling approximately $74,000 and $24,000 respectively, and annual payments under its surface right agreement with the local ejido of approximately $25,000.

 

The Company has office leases for its corporate headquarters in Golden, Colorado, as well as for its Velardeña Properties offices in Mexico, and exploration offices in Mexico and Argentina.  The lease for the corporate headquarters office space was renegotiated and extended during the first quarter 2014. The new lease reflects an approximately 46% reduction in space and an approximately 44% reduction in cost beginning March 1, 2014. The new lease expires November 30, 2019. Payments associated with the corporate headquarters lease were recorded to rent expense by the Company in the amounts of $224,000 and $227,000 for the years ended December 31, 2016 and 2015, respectively.

 

The Company cannot currently estimate the life of the Velardeña Properties or El Quevar project. The table above assumes that no annual maintenance payments will be made more than five years after December 31, 2016. If the Company continues mining and processing or evaluations of restart at the Velardeña Properties beyond five years, the Company expects that it would make annual maintenance payments of approximately $75,000 per year for the life of the Velardeña mine. If the Company continues to evaluate development opportunities at the El Quevar project, the Company expects that it would make annual maintenance payments of approximately $115,000 per year for the life of the El Quevar mine.

 

Payments associated with other exploration concessions the Company owns are not included because the Company has not completed exploration work on these concessions. Exploration success is historically low and the Company has the right to terminate the payments and release the concessions at any time.

 

Contingencies

 

The Company has recorded loss contingencies of nil and approximately $0.4 million at December 31, 2016 and December 31, 2015, respectively as discussed in Note 12.