XML 23 R9.htm IDEA: XBRL DOCUMENT

Mineral Properties

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Mineral Properties

2. Mineral Properties:

The following table details Solitario’s capitalized investment in exploration mineral property:

(in thousands)	December 31,
	2015	2014
Exploration
La Promesa (Peru)	5	5
Norcan (Mexico)	6	6
Aconchi (Mexico)	5	5
Canta Colorado (Mexico)	3	3
Total exploration mineral property	19	19

Mt. Hamilton

On February 22, 2012, Solitario earned an 80% interest in MH-LLC as a result of the completion of a feasibility study on the Mt. Hamilton project (the “Feasibility Study”) prepared by SRK Consulting (US), Inc. of Lakewood, Colorado (“SRK”). In October 2014, SRK, on behalf of Solitario completed an updated feasibility study on the Mt. Hamilton project.

Solitario sold its interest in the Mt. Hamilton project on August 25, 2015 through the Transaction. Mt. Hamilton capitalized costs are included in discontinued operations at December 31, 2014. See above in “Recent Developments” in Note 1, “Business and Summary of Significant Accounting Policies.”

Capitalized costs

Solitario has been capitalizing its development costs incurred at its Mt. Hamilton project subsequent to the completion of the Feasibility Study in February 2012. The following table details the capitalization during 2015 up to the date of the Transaction and for the year ended December 31, 2014:

(in thousands)	Year ended December 31,
	2015	2014
Development expenditures	$692	$ 1,678
Capitalized interest	493	633
Property payments	190	250
Capitalized depreciation	7	21
Total capitalized costs	$ 1,382	$ 2,582

Included in the property payments during 2015 and 2014 are the issuance of 66,500 and 35,000, respectively, common shares of Solitario with fair values of $51,000 and $38,000, respectively, issued to underlying leaseholders which were recorded as an increase to common stock, for the par value of the shares issued and to additional paid-in-capital. These capitalized costs at December 31, 2014 are included in discontinued operations and all costs associated with Mt. Hamilton related to the Transaction were included in the net assets disposed of in determining the gain on sale of MH-LLC during 2015.

Solitario also capitalized $300,000 during 2014 of advance royalty payments to the underlying leaseholder as long-term other assets. See Note 4, “Other Assets,” below.

Exploration property

Solitario's exploration mineral properties at December 31, 2015 consist of use rights related to its exploration properties, and the value of such assets is primarily driven by the nature and amount of economic mineral ore believed to be contained, or potentially contained, in such properties. The amounts capitalized as mineral properties include concession and lease or option acquisition costs. Capitalized costs related to a mineral property represent its fair value at the time it was acquired. At December 31, 2015, none of Solitario’s exploration properties have production (are operating) or contain proven or probable reserves. Solitario's exploration mineral properties represent interests in properties that Solitario believes have exploration and development potential. Solitario's mineral use rights generally are enforceable regardless of whether proven and probable reserves have been established.

In addition to its capitalized exploration properties, Solitario has an interest in its Bongará exploration concession, which is currently subject to a joint venture agreement where joint venture partners made stand-by joint venture payments to Solitario during 2014. Solitario records joint venture property payment revenue received in excess of capitalized costs and recorded $200,000 of standby joint venture property revenue on its Bongará project during 2014. Per the joint venture agreement no further standby joint venture payments are due to Solitario on the Bongará project. At December 31, 2015 and 2014, Solitario has no remaining capitalized costs related to its Bongará joint venture.

Solitario previously sold its mineral interests in its Yanacocha exploration projects and retained a royalty interest. Solitario has no capitalized costs related to its Yanacocha royalty interest.

Discontinued projects

During 2015, Solitario converted its operating interest in its Pedra Branca Mineracao, Ltd (“PBM”), which was the owner of the Pedra Branca project in Brazil, to a 1% net smelter royalty in the Pedra Branca project, upon the termination of its interest in PBM. Previously Solitario had accounted for its interest in PBM under the equity method of accounting through 2014, recognizing a reduction of its remaining interest in PBM of $153,000 during 2014, and has no remaining asset value assigned to PBM or Pedra Branca as of December 31, 2015 and 2014. During 2014, Solitario recorded $20,000 of mineral property write-downs related to its Pachuca exploration project in Mexico.

Exploration Expense

The following items comprised exploration expense:

	For the year ended December 31,
(in thousands)	2015	2014
Geologic and field expenses	$31	$197
Administrative	58	82
Total exploration expense	$89	$279