Eaglecrest Explorations Ltd. (TSX VENTURE: EEL)(FRANKFURT: EAT)
("Eaglecrest"; the "Company") today announced it has executed a
binding letter agreement pursuant to which it has been granted an
option (the "Option") to acquire a 75% interest in the mineral
title of the Venecia Project ("Venecia"), located in Antioquia,
Colombia. Venecia is a property package owned by Colombian Mines
Corporation ("Colombian Mines") which consists of 1,985 hectares of
mineral title. This is the second of several projects the Company
is pursuing for acquisition along the 300-kilometre (km) Middle
Cauca Gold Belt that extends from the La Colosa gold resource
(owned by AngloGold Ashanti) through to Medellin.
SUMMARY
-- Option to purchase up to a 75% interest in the mineral title of the
Venecia Project, located in Antioquia, Colombia; 100% owned by Colombian
Mines
-- Venecia has 1,985 hectares of mineral title on the Middle Cauca Gold
Belt
-- Venecia has potential for a porphyry-style gold discovery, based on
exploration conducted by Colombian Mines
-- Drilling could begin early-2011 after about six months field work
-- Venecia has excellent year-round access, adequate supplies of power and
water to the property, and a skilled workforce nearby
-- This completes the package as Eaglecrest holds an option for up to 75%
of the Fredonia Project on three large concessions that surround Venecia
"The Venecia project is a strategic acquisition that complements
and fills in some gaps in the Fredonia concessions we recently
optioned from Grupo de Bullet. We are hopeful that this acquisition
will further emphasize our new focus on gold exploration in
Colombia," reported Eaglecrest CEO, Hans Rasmussen. "Colombian
Mines' geologists have done an excellent job at advancing the
project and demonstrating the potential for a porphyry-style gold
discovery. The preliminary data Colombian Mines has already
collected implies we should have a drill-ready target in early
2011."
"Adding the Venecia Project area effectively surrounds Bellhaven
Resources' La Mina porphyry copper-gold project and is prospective
for similar mineralization," commented Dr. Richard Jemielita,
Eaglecrest's Qualified Person in Colombia, with 20 years experience
exploring for gold in the Andes Mountains of South America.
The Venecia project was selected as part of Eaglecrest's project
generation program which is focused on multi-million ounce
porphyry-gold resources. The property adjoins the western edge of
the La Mina concession, where Bellhaven Resources has recently
announced drill intercepts of 72.7 to 142.5 m of 0.7 to 1.07 g/t
gold (see Bellhaven Resources news release of September 9, 2010).
Venecia lies approximately 20 km north of AngloGold
Ashanti/B2Gold's Quebradona gold - copper porphyry project, where
drill intercepts of up to 380 m of 1.15 g/t gold have been
reported. To the north, the historic producing mines of Titiribi,
Cerro Vetas and El Zancudo are found.
Eaglecrest will continue to focus on the existing projects and
new projects in the Middle Cauca Gold Belt, which is Colombia's
most prolific gold belt. The belt hosts the 500 year-old Marmato
mining district with NI 43-101 compliant resources currently at 9.7
million ounces of gold (see Medoro Resources Ltd website for the NI
43-101 report) and the 12.9 million ounce La Colosa project (see
AngloGold Ashanti news release of May 6, 2008).
The Venecia Project
Colombian Mines Corporation's 100% controlled Venecia Property
covers 1,985.09 hectares. Recent work by Colombian Mines' geologic
team has identified mineralized rock outcrops that have up to 3.8
grams per tonne (g/t) gold, and up to 0.6% copper over a one metre
channel width in an area of very sparse outcrop (see Colombian
Mines Corporation news release of September 1, 2010). A total of
180 soil samples, also collected on a widely-spaced grid, confirmed
that gold and copper trends from Venecia spread into the La Mina
concession and to the east, north and west into the Eaglecrest
concessions.
The Company plans to conduct detailed surface evaluation of the
Venecia Property over the next six months to include geological
mapping, high-resolution magnetic surveying, stream sediment and
soil grid geochemistry, and additional rock chip sampling. The
results of this work will be used to generate high-quality drill
targets by early 2011 on Venecia and the three surrounding
concessions in the Fredonia Project area.
Paved and gravel roads provide excellent year-round access to
the Property from Medellin (21/2 hours) and Venecia (15 minutes).
Adequate supplies of power and water are situated on and near the
property, and an adequate workforce is readily available from the
nearby towns of Venecia, Fredonia and Bolombolo. The primary
surface use of the property is agricultural, consisting of cattle
grazing, coffee plantations and citrus groves.
The Option agreement provides for negotiation of a definitive
agreement setting out the terms in more detail within the next six
months, but the essential Option terms are as follows:
1. On signing, US$30,000 in cash, and within 6 months, US$50,000
in exploration expenditures, 250,000 shares and warrants
exercisable to purchase an additional 250,000 shares for two years
at a price equal to the greater of $0.45 (the "Minimum Warrant
Exercise Price") and the Market Price at the time of signing the
definitive agreement (the "Signature Date") plus a 25% premium.
2. Within 12 months after the Signature Date, an additional
US$80,000 in cash, an additional US$950,000 in exploration
expenditures, an additional 125,000 shares and warrants exercisable
to purchase an additional 125,000 shares for two years at a price
equal to the greater of the Minimum Warrant Exercise Price and the
Market Price at the Signature Date plus a 25% premium.
3. Within 24 months after the Signature Date, an additional
US$75,000 in cash, an additional US$1,000,000 in exploration
expenditures, an additional 125,000 shares and warrants exercisable
to purchase an additional 125,000 shares for two years at a price
equal to the greater of the Minimum Warrant Exercise Price and the
Market Price at the Signature Date plus a 25% premium.
4. Within 36 months after the Signature Date, an additional
US$350,000 in cash, an additional US$1,000,000 in exploration
expenditures, an additional 125,000 shares and warrants exercisable
to purchase an additional 125,000 shares for two years at a price
equal to the greater of the Minimum Warrant Exercise Price and the
Market Price at the Signature Date plus a 25% premium.
The definitive purchase option agreement is expected to be
signed in six months. Upon Eaglecrest exercising the Option and
acquiring a 75% interest in the property, a joint venture will be
formed and CMJ will have the option to either fund its 25% of
expenses, sell its interest in the property at its fair market
value or have Eaglecrest fund CMJ's share of expenses, in which
event Eaglecrest will receive 100% of proceeds from production
until it has been repaid such funds plus interest at the U.S. Prime
Rate plus 5%. The Option agreement is subject to acceptance by the
TSX Venture Exchange.
About Eaglecrest
Eaglecrest Explorations Ltd. is systematically exploring,
developing and monetizing promising gold projects in Colombia and
Bolivia.
The management and geologic teams at Eaglecrest are comprised of
industry experts experienced with gold discoveries over the past
three decades while working with both junior and major mining
companies. With this team and the increased sentiment towards gold,
Eaglecrest looks to accelerate the evaluation and capitalization of
its Bolivian asset, shifting its focus to securing interests in,
and initiating the anticipated exploration programs at the Fredonia
project, Colombia, located south of Medellin.
If you would prefer to receive news releases via email please
contact Jennie Guay (jennie@chfir.com) and specify "Eaglecrest
news" in the subject line.
Neither the TSX Venture nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture) accepts
responsibility for the adequacy or accuracy of this release.
Contacts: Eaglecrest Explorations Ltd. Hans Rasmussen President
801-554-2074 hans@eaglecrestexplorations.com
www.eaglecrestexplorations.com CHF Investor Relations Jeanny So
Director of Operations 416-868-1079 x 225 jeanny@chfir.com
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