Canyon Copper Corp. enters into agreement to acquire Moonlight copper porphyry property

VANCOUVER, Nov. 29, 2011 /CNW/ - Canyon Copper Corp. ("Canyon") (TSX-V: CNC) (OTCBB: CNYC) is pleased to announce that it has entered into an assignment agreement (the "Assignment Agreement") with Metamin Enterprises Inc. (the "Assignor"), a company controlled by Benjamin Ainsworth, Canyon's President, Secretary and director, and Metamin Enterprises USA Inc. (the "Subsidiary"), a wholly owned subsidiary of the Assignor, to acquire the former Placer Dome Moonlight Project, a bulk tonnage porphyry copper, gold, silver property.  It is located on the Northern end of the very productive Walker Lane Porphyry Trend that includes major past producers such as the Yerrington Mine in Nevada and properties like Canyon's New York Canyon Project, south of Hawthorne, Nevada.

The Moonlight Property is located in an area with a historical mining tradition that brought significant benefits to the local communities around Crescent City, Plumas County, California, with a low environmental impact. The local community has been involved in logging and mining historically and is currently enduring high unemployment. Local support was expressed for a recent exploration effort (2006-8) on the Moonlight Property for development of a long life project in the labour catchment area.

A historical estimate was disclosed by Sheffield Resources Ltd. in the technical report titled "Moonlight Copper Property, Plumas County, California" dated April 2007, prepared by George Cavey, P.Geo and Gary Giroux, P.Eng., and filed on SEDAR on May 14, 2007. The historical estimate is now out of date by virtue of further work and a change in the boundaries of the Moonlight Property since the report was written. The historical sulphide resource estimate was wholly contained by the claims now subject to this agreement with the resource estimates described in the following grade tonnage tables:

MOONLIGHT INDICATED MINERAL RESOURCE GRADE-TONNAGE TABLE
Cutoff   Tons > Cutoff      Grade > Cutoff
(Cu%)       (tons)   Cu(%)    Au (oz/t)  Ag (oz/t)
0.20   161,570,000   0.324     0.003 0.099
0.25   114,570,000   0.366     0.003 0.112
0.30    76,150,000   0.413     0.003 0.124
MOONLIGHT INFERRED MINERAL RESOURCE GRADE-TONNAGE TABLE  
Cutoff   Tons > Cutoff      Grade > Cutoff
(Cu%)       (tons)   Cu(%)   Au (oz/t)   Ag (oz/t)
0.20   88,350,000   0.282   0.003 0.089
0.25   48,820,000   0.329   0.003 0.107
0.30   23,720,000   0.390   0.003 0.118

The historical estimate cited above uses "indicated mineral resource" and "inferred mineral resource", which are categories set out in National Instrument 43-101.  Accordingly, Canyon considers these historical estimates reliable as well as relevant as it represents a target for future exploration work by Canyon. In order to verify this as a current estimate, the location of the resource needs to be defined as being wholly within the current claim boundary of the Moonlight Project. The further work was an airborne Dighem survey by Fugro Resources and is not likely to change the mineral resource estimate but should be reviewed. The qualified person has not done sufficient work to classify the historical estimate as a current mineral resource and Canyon is treating these historical estimates as relevant but not current mineral resources.

In addition to the historical estimate prepared by Sheffield Resources Ltd., in 1972, American Exploration and Mining Company ("Amex"), a wholly owned subsidiary of Placer Dome, in an internal report by C.Gillette, a mining engineer employee of Amex, identified an historical oxide "resource" of 12.2 million tons of "ore" at an average grade of 0.54% Cu at a cutoff grade of 0.25% Cu, overlain by 10.8 million tons of "waste". This "waste" was so characterized because of a lack of assaying of the top 3 - 9.1 meters (10 - 30 feet) of the drill holes. Sheffield recovered more than 0.25% copper from virtually all the near surface material when drilling adjacent to holes where Amex had drilled and reported 6m (20 feet) of overburden. The historical "ore" cited above is mentioned for historical purposes only and uses terminology not compliant with current reporting standards.  The reliability of these historical estimates is unknown but considered relevant by Canyon as it represents a significant target for future exploration work by Canyon.  The qualified person has not made any attempt to re-classify the estimates accordingly to current NI 43-101 standards of disclosure or the CIM definitions.  Canyon is not treating this estimate as current mineral resources or mineral reserves as defined in NI 43-101.  Historical "ores" are not equivalent to mineral reserves or resources as they are not supported by at least a feasibility study.

Under the terms of the assignment agreement, the Assignor has agreed to assign all of its right, title and interest in and to an option agreement dated September 20, 2010, as amended on February 18, 2011 and October 31, 2011, (the "Option Agreement") between the Assignor and Lester Storey (the "Optionor") in respect of a mineral property located in Plumas County, California (the "Moonlight Property"); and the Subsidiary has agreed to transfer to Canyon certain mineral claims held by the Subsidiary that form part of the Moonlight Property. 307 claims make up the property having an area of approximately 6300 acres (2550 hectares).

In consideration of the assignment, Canyon has agreed to:

(a)      pay to the Assignor the following cash payments:
  (i)      USD $15,000 on the date of approval from the TSX Venture Exchange (the "Exchange Acceptance Date");
  (ii)      USD $25,000 on or before February 18, 2012;
  (iii)      USD $25,000 on or before February 18, 2013;
  (iv)      an annual advanced royalty, deductible from any future royalty payments, of USD $15,000 commencing on February 18, 2014 and payable every year thereafter; and
(b)      issue to the Assignor the following shares of Canyon's common stock ("Shares"):
  (i)      75,000 Shares on the Exchange Acceptance Date;
  (ii)      75,000 Shares on or before February 18, 2012;
  (iii)      150,000 Shares on or before February 18, 2013; and
  (iv)      200,000 Shares on or before February 18, 2014.

Canyon has also agreed to reimburse the Assignor, on the Exchange Acceptance Date, for annual maintenance and exploration expenses previously incurred on the Moonlight Property by the Assignor, which amount cannot exceed USD $200,000.  The Assignor will retain a 1% net smelter return on metals extracted from the Moonlight Property, which can be repurchased by Canyon for $1,000,000, and a gross overriding royalty of 2.5% on receipts from the sale of industrial minerals.

Upon closing of the Assignment Agreement, Canyon will assume all of the Assignor's rights and obligations under the Option Agreement and will be required to do the following in order to maintain and exercise the Option:

(a)      pay to the Optionor the following cash payments:
  (i)      USD $25,000 on or before February 18, 2012;
  (ii)      USD $25,000 on or before February 18, 2013;
  (iii)      an annual advanced royalty, deductible from any future royalty payments, of USD $15,000 commencing on February 18, 2014 and payable every year thereafter; and
(b)      issue to the Optionor the following Shares:
  (i)      75,000 Shares on the Exchange Acceptance Date;
  (ii)      75,000 Shares on or before February 18, 2012;
  (iii)      150,000 Shares on or before February 18, 2013; and
  (iv)      200,000 Shares on or before February 18, 2014.

Under the Option Agreement, Canyon is also required to incur USD$100,000 in exploration expenditures on the Moonlight Property by February 18, 2013.  The Optionor will retain a 1% net smelter return on metals extracted from the Moonlight Property, which can be repurchased by Canyon for $1,000,000, and a gross overriding royalty of 2.5% on receipts from the sale of industrial minerals.

The Assignment Agreement is conditional upon, among other things, Canyon obtaining approval from the TSX Venture Exchange.

Recent Project History

The Moonlight Property was extensively explored by American Exploration and Mining Company from 1966 to 1971. Placer Dome Inc, and its subsidiaries focussed upon gold exploration and development and in 1994 the Moonlight Property was dropped and all claims allowed to lapse. In September 1994, the Optionor staked the core Diane claims which have remained in his control since that time.

The Diane claims were optioned to the Assignor in this agreement in 2005 and that option agreement was assigned to Sheffield Resources Ltd who staked further ground and carried out a drill program and commissioned the April 2007 NI 43 101 technical report and resource estimate filed on SEDAR. Sheffield merged with Nevoro Resources in 2008 and Nevoro was acquired by Starfield Resources Ltd in 2009. Starfield carried out a property wide Airborne Dighem Survey in that year and quit claimed the original Diane claims and most of the additional claims staked by Sheffield back to the underlying owner and the Assignor in 2010, respectively.

About Canyon Copper's New York Canyon Property
The New York Canyon property is located 30 miles (48 km) east of Hawthorne, Nevada. It consists of 24 patented claims covering 420 acres (170 hectares) of which 18 are leased, and 1,293 unpatented mining claims covering approximately 25,860 acres (10,781 hectares) for a total area of approximately 42 sq. miles. For the Longshot Ridge target, the Company has obtained an indicated mineral resource estimate, at a cut-off grade of 0.2% copper, of 16,250,000 tons at an average grade of 0.43% Cu, and an inferred mineral resource estimate, at cut-off grade of 0.2% copper, of 2,900,000 tons at an average grade of 0.31% Cu (see National Instrument 43-101 ("NI 43-101") Technical Report filed on SEDAR on May 6, 2010 and news release dated May 3, 2010).

To learn more about Canyon Copper and its projects (New York Canyon and Moonlight) please visit: www.canyoncc.com

Qualified Person
Benjamin Ainsworth, P. Eng, BC, with Licence #8648 and the President of Canyon, is a Qualified Person as defined by NI 43-101 and has reviewed and approved the contents of this news release.

On behalf of the Board of Directors,

"Anthony Harvey"

CANYON COPPER CORP.
Anthony Harvey, CEO

Cautionary Statement Regarding Forward Looking Information
This News Release may contain, in addition to historical information, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are identified by their use of terms and phases such as "believe," "expect," "plan," "anticipate" and similar expressions identifying forward-looking statements. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from Canyon's expectations, and expressly does not undertake any duty to update forward-looking statements. These factors include, but are not limited to the following, Canyon's ability to acquire the Moonlight Property and Canyon's ability to obtain additional financing, uncertainty of estimates of mineralized material and other factors which may cause the actual results, performance or achievements of Canyon to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Cautionary Note to U.S. Investors Regarding Estimates of Measured, Indicated and Inferred Resources
This News Release may use the terms "measured", "indicated" and "inferred" "resources."  We advise U.S. investors that while these terms are recognized and required by Canadian regulations, the SEC does not recognize them.  "Inferred resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility.  It cannot be assumed that all or any part of an "inferred mineral resource" will ever be upgraded to a higher category.  Under Canadian rules, estates of "inferred mineral resources" may not form the basis of a feasibility study or prefeasibility studies, except in rare cases.  The SEC normally only permits issuers to report mineralization that does not constitute "reserves" as in-place tonnage and grade, without reference to unit measures.  U.S. investors are cautioned not to assume that any part or all of a measured, indicated or inferred resource exists or is economically or legally mineable.

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

 

For further information:

Canyon Copper Corp.
Investor Relations
1-888-331-9326
(604) 331-9326
(604) 684-9365 (FAX)
info@canyoncc.com

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Canyon Copper Corp.

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