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Mineral Properties | 12 Months Ended
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Dec. 31, 2023
Mineral Properties |
Mineral Properties | 2. Mineral Properties: The following table details Solitario’s capitalized mineral property:
(in thousands) |  | December 31, |
|  | 2023 |  |  | 2022 |
Exploration |  |  |  |  |  |
Lik project (Alaska – US) |  | $ | 15,611 |  |  | $ | 15,611 |
Golden Crest (South Dakota – US) |  |  | 1,035 |  |  |  | 1,035 |
Total exploration mineral property |  | $ | 16,646 |  |  | $ | 16,646 |
Exploration property Solitario's exploration mineral properties at December 31, 2023 and 2022 consist of use rights related to its exploration properties. The amounts capitalized as mineral properties include initial concession and lease or option acquisition costs. At December 31, 2023, none of Solitario’s exploration properties have production (are operating) or have established proven or probable reserves. Solitario's exploration mineral properties represent interests in properties that Solitario believes have exploration and development potential. Golden Crest On May 27, 2021, Solitario entered into a lease agreement (the “Golden Crest Agreement”) whereby Solitario acquired exclusive exploration rights in certain claims (the “GC Claims”) in the Black Hills region of South Dakota. The GC Claims are part of Solitario’s Golden Crest project. Terms of the Golden Crest Agreement include scheduled payments to the underlying owner of $65,000 paid upon signing and a required payment to the underlying owner of $60,000 at the first anniversary date during 2022. Solitario recorded an initial acquisition cost of $125,000 during 2021 related to these required payments. In addition, to continue the lease, Solitario has agreed to pay, at its option, the underlying owner escalating annual payments over five years that total $340,000 and annual payments of $150,000 thereafter, which will be expensed as paid. All required payments have been made through December 31, 2023 and 2022. Solitario has agreed to pay the underlying owner an additional success fee of $1.00 per ounce of gold in the event Solitario files a 43-101 qualified resource of up to 1.5 million ounces of gold or a maximum of $1,500,000. In order to maintain the leases in good standing, Solitario has agreed to escalating work commitments on the GC Claims and an area of interest around the GC claims totaling $3,000,000 during the first five years of the lease, with first and second-year minimum exploration expenditures of $200,000 during 2022, and $400,000 during 2023, which Solitario exceeded during both 2022 and 2023. The term of the Golden Crest Agreement is for twenty years and is automatically extended as long as Solitario is performing any exploration, development or mining activities on the GC Claims. The underlying owner retained a 2.0% Net Smelter Return royalty. Solitario will have the option, but not the obligation, to reduce the Net Smelter Return royalty to 1.0% by paying the owner $1,000,000. Through December 31, 2023, Solitario has staked additional mineral claims, including some claims included in an area of interest of the GC Claims and claims not related to the GC Claims, as part of the Golden Crest project. As of December 31, 2023 and 2022 Solitario has capitalized costs for staking, initial filing fees, legal and other costs of $1,035,000 as initial acquisition costs related to the Golden Crest project. Lik Property Solitario holds a 50% operating interest in the Lik zinc-lead sliver property in northwest Alaska, which we acquired as part of the acquisition of Zazu Metals Corporation (“Zazu”) in July 2017. Solitario recorded its acquisition cost of $15,611,000 as mineral property at the date of acquisition. Teck is Solitario’s 50% partner on the Lik Project and acted as the project manager during 2023 and 2022. Teck and Solitario share exploration expenditures at Lik on a 50/50 basis, with Teck earning a manager’s fee of ten percent of the total expenditures of which Solitario contributes one-half to Teck. All of Solitario’s share of expenditures at Lik are included in exploration expense for the years ended December 31, 2023 and 2022. Florida Canyon Solitario has an interest in its Florida Canyon exploration concessions, which are currently subject to a joint venture agreement where joint venture partners made stand-by joint venture payments to Solitario prior to January 1, 2015. Solitario previously recorded joint venture property payment revenue received in excess of capitalized costs. Per the joint venture agreement, as of December 31, 2023 and 2022, no further standby joint-venture payments are due to Solitario on the Florida Canyon project. At December 31, 2023 and 2022, Solitario has no remaining capitalized costs related to its Florida Canyon joint venture. Per the joint venture agreement with Nexa covering the Florida Canyon project, Solitario currently holds a 39% interest in the Florida Canyon project. Nexa is required to fund 100% of exploration expenditures at the Florida Canyon project, until Nexa commits to put the project into production based upon a positive feasibility study, at which time Nexa’s interest will increase from its current 61% interest to a 70% interest. Exploration Expense The following items comprised exploration expense:
|  | For the year ended December 31, |
(in thousands) |  | 2023 |  |  | 2022 |
Geologic and field expenses |  | $ | 2,176 |  |  | $ | 2,121 |
Administrative |  |  | 202 |  |  |  | 162 |
Total exploration expense |  | $ | 2,378 |  |  | $ | 2,283 |
Asset Retirement Obligation Solitario recorded an asset retirement obligation of $125,000 upon the acquisition of the Lik project for Solitario’s estimated reclamation cost of the existing disturbance at the Lik project. This disturbance consists of an exploration camp including certain drill sites and access roads at the camp. The estimate was based upon estimated cash costs for reclamation as determined by Solitario and its joint venture partner Teck and is supported by a permitting bond required by the State of Alaska, for which Solitario has retained a reclamation bond insurance policy in the event Solitario or its 50% partner, Teck, do not complete required reclamation. As of December 31, 2023 and 2022, Solitario has no reclamation liability at its Florida Canyon project as Nexa is responsible for the costs at Florida Canyon, including reclamation, if any. In addition, the activities to date at Solitario’s Golden Crest project of staking claims and mapping, soil and rock sampling, and assaying have not created any material environmental or other disturbances. Historically Solitario’s exploration activities have not resulted in any long-term environmental disturbances or liabilities and where there have been required restoration of disturbances, these have been completed contemporaneously with the completion of our mineral exploration activities. As of December 31, 2023 and 2022 Solitario has no reclamation liability at its Golden Crest project, as all of the activities to date at Golden Crest have consisted of hand-collected surface sampling and related non-disturbance geophysical studies. Certain minimal disturbances, such as trenching, which has been limited to existing roads, are concurrently remediated and do not require on-going or future reclamation.

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