Red Metal Resources Ltd. (CSE: RMES; OTCPINK: RMESF; FSE: I660) reported on August 12, 2026 that its Chilean subsidiary, Minera Polymet SpA, has signed a renewable five-year lease with CMS Catalina, a local small-scale mining company based in Vallenar, Chile, covering the company’s Irene and Margarita copper-gold concessions. Under the arrangement, CMS Catalina will handle all mining, while Red Metal collects a royalty on what’s produced, a structure the company frames as a way to generate revenue from the roughly 106-hectare property without spending its own capital or taking on operating risk.
The Deal Terms
CMS Catalina will pay Polymet a royalty equal to 10% of the gross value of all minerals extracted, with a guaranteed minimum payment of $1,000 per month starting in the third month of the lease. Production is expected to ramp from 1,000 tonnes in the first month after an initial three-month grace period, to 1,500 tonnes in the second month, and to a minimum of 2,500 tonnes per month from the third month onward, out of a maximum permitted 5,000 tonnes per month. If CMS Catalina fails to maintain that 2,500-tonne minimum after ramp-up, Red Metal can terminate the lease. During the grace period, CMS Catalina is responsible for securing Chilean mining permits, arranging explosives storage, and upgrading road access to the property. Red Metal retains the right to explore the concessions itself at any time, so the lease doesn’t prevent the company from pursuing its own future development there.
This is a modest deal in dollar terms, a $1,000 monthly minimum is a small figure for a company with a broader Chilean and Canadian exploration portfolio, and it’s Red Metal’s second such small-scale mining lease in the region, following a similar arrangement already in place at its nearby Carrizal property.
A Caveat on the Historical Numbers
The release includes historical production figures for the Irene concession: Chilean state ore processor ENAMI reportedly mined about 16,144 tonnes of rock there between 1994 and 1997 at an average grade of 3.2% copper, 43.7 grams per tonne silver, and 0.72 grams per tonne gold, and the property’s former owner delivered roughly 3,219 tonnes of test-mined ore to ENAMI in 2009-2010. These numbers are worth noting with an important caveat spelled out by the company itself: this historical data has not been verified by a Qualified Person and does not meet the standards of National Instrument 43-101 (NI 43-101), the Canadian rule governing formal mineral resource and reserve disclosure. No NI 43-101 mineral resource or reserve estimate exists for this property at all. Red Metal says the figures are only meant to show that mineralization is present at the site, not to indicate what the property could actually produce going forward, and cautions they shouldn’t be relied upon for that purpose.
Context
Irene and Margarita sit in Chile’s Atacama Region, part of the Candelaria Iron Oxide Copper-Gold belt where Red Metal also holds its separate, larger Carrizal Copper-Gold-Cobalt property. The company said it continues advancing exploration work at Carrizal, including an induced polarization survey aimed at refining future drill targets, with small-scale miners there expected to begin delivering ore to ENAMI in the fall of 2026.
Sources
Editorial Disclosure
This article is based on a press release issued by Red Metal Resources Ltd. on August 12, 2026, distributed via PRNewswire. Securities discussed: Red Metal Resources Ltd. (CSE: RMES; OTCPINK: RMESF; FSE: I660). Mining Markets Report has not received compensation from Red Metal Resources, its management, investor relations representatives, or any third party for this coverage. No staff member or principal of Mining Markets Report holds a position in this security at the time of publication. Historical production figures cited for the Irene concession (1994-1997 and 2009-2010) have not been verified by a Qualified Person, do not conform to National Instrument 43-101 (NI 43-101) standards, and no current NI 43-101 mineral resource or reserve estimate exists for this property; these figures should not be relied upon as an indication of future production and are cited here solely as reported by the company to show historical evidence of mineralization. Mining at the property is being conducted by the lessee, not by Red Metal, and is not supported by any feasibility study or technical study demonstrating economic viability. Statements regarding future production levels, royalty revenue, and permitting timelines are forward-looking and involve known and unknown risks; there is no assurance that anticipated production or royalty revenue will be realized. References to this company are for market context and analytical purposes only and do not constitute an investment recommendation. All securities carry investment risk including possible loss of capital. Coverage on Mining Markets Report is for informational and educational purposes only; Mining Markets Report is not a registered investment advisor. Readers should conduct their own due diligence and consult a qualified financial advisor before making investment decisions.
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