6. Property and Equipment

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

6. Property and equipment

The Company acquired property and equipment with a historical cost value of $7,331,655 in the Sulfatos Acquisition in March 2012. See Note 3 - Sulfatos Acquisition. The following table sets forth our property and equipment at the dates indicated. These assets, with the exception of land which is not depreciable, are being depreciated over their remaining useful lives. The Company recognized depreciation expense of $637,510 for the year ended December 31, 2013, $93,098 from inception (January 1, 2012) to December 31, 2012, and $730,608 for the period from inception to December 31, 2013.

The Company reviewed its long term assets as of December 31, 2013 based on ASC 360-10-35-21, Property, Plant, and Equipment - Overall – Subsequent Measurement – Impairment or Disposal of Long-Lived Assets – Long-Lived Assets Classified as Held and Used – When to Test a Long-Lived Asset, for Recoverability. Pursuant to ASC 360-10-35-21, a long-lived asset (asset group) shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable.

In 2012, the Company had a third party business valuation performed which included a valuation of its mining properties. The valuation of the mine was based on a geological study on the mine made in April 2008. During the study, mineral samples were extracted using the random stratified sampling method from existing extraction piles, using material extracted from two vein trenches. In addition, two samplings of 12 kilograms each were analyzed by the Nueva Pudahel chemical laboratory, and results of 1.26% and 1.27% copper, respectively, were recorded. Preliminary drilling indicates 3 million tons of resources with a copper concentration of 1% to 1.5%. The valuation concluded that additional studies were necessary to determine resources on all 1,325 hectares. As the value calculated per the valuation was greater than the carrying costs acquired, we determined that the carrying costs were validated by valuation performed as of December 31, 2012. Because it has been less expensive to purchase raw materials for the Copper Sulfate Production Plant from third parties than to mine the material from the Anica Mine, Sulfatos was not actively exploiting the mine as of December 31, 2013. Because the useful life of this mine to Sulfatos is currently unknown, the Company elected to impair $4,146,764, the full book value of the Anica Mine and other mine costs as of December 31, 2013.

On October 16, 2014 we were informed that an injunction order was granted against Lustros Chile SpA’s assets in the Congo Project arbitration until a resolution is reached. These assets include bank accounts and Lustros’ shares in Sulfatos Chile S.A. We have elected to shut down our copper sulfate processing plant pending resolution of this matter.

	December 31, 2013			December 31, 2012
Buildings	$	163,600		$	164,726
Furniture & fixtures		21,951			24,023
Vehicles		120,048			131,376
Machinery and mining equipment		397,879			423,453
Plants (crushing and agglomeration plant, heap leaching area, chemical plant and Solvent Extraction and Crystallization (SX - CR - RCR) plant) / property improvements		3,404,244			3,928,356
Computers		34,324			37,018
Lab equipment		60,828			65,675
Total fixed assets	$	4,202,874		$	4,774,626
Less depreciation		(716,163	)		(126,810	)
Net fixed assets	$	3,486,711		$	4,647,816
Land	$	534,596		$	585,040
Congo right to use	$	0		$	360,000
Mining property - Anica Mine	$	0		$	3,720,011
Net property and equipment	$	4,021,307		$	9,312,867