Remediation Liability and Asset Retirement Obligation

3 Months Ended

Mar. 31, 2016

Remediation Liability and Asset Retirement Obligation [Abstract]

REMEDIATION LIABILITY AND ASSET RETIREMENT OBLIGATION

NOTE 11 – REMEDIATION LIABILITY AND ASSET RETIREMENT OBLIGATION

Remediation, reclamation and mine closure costs are based principally on legal and regulatory requirements. Management estimates costs associated with reclamation of mining properties as well as remediation costs for inactive properties. The Company uses assumptions about future costs, capital costs and reclamation costs. Such assumptions are based on the Company’s current mining plan and the best available information for making such estimates. In calculating the present value of the asset retirement obligation the Company used a credit adjusted risk free interest rate of 8% to 10% and projected mine lives of five to 12 years, depending on the site. On an ongoing basis, management evaluates its estimates and assumptions; however, actual amounts could differ from those based on such estimates and assumptions.

Changes in the reclamation liability for the periods ended March 31, 2016 and December 31, 2015 are as follows:

	Three months ended  March 31,  2016		Year ended December 31,  2015
Reclamation and remediation liability, beginning of period	$	901,597	$	740,268
Obligation incurred		-		101,551
Accretion expense		18,128		59,778
Reclamation and remediation liability, end of period	$	919,725	$	901,597