Firesteel Resources completes definitive agreement with Prosper Gold Corp. on Sheslay Porphyry Project British Columbia

Trading Symbol: TSX.V:FTR

VANCOUVER, July 18, 2013 /CNW/ -  Firesteel Resources Inc. ("Firesteel" or the "Company") (TSX.V:FTR) today announced that it has entered into a definitive agreement on July 15th, 2013 (the "Option Agreement") with Prosper Gold Corp. (Prosper") (NEX: PGX.H), whereby Firesteel has granted the Company the option to acquire up to an 80% interest in the 6,829 hectare alkalic porphyry copper-gold Sheslay Property in northwest British Columbia (the "Property"). The Property, formerly called the Copper Creek Property, is located approximately 50 km northwest of Telegraph Creek, 100 km west of Dease Lake and 8 km from the Golden Bear mine access road.  There is an airstrip on the Property.

The Option Agreement

Under the terms of the Option Agreement, Prosper has an option (the "First Option") to earn a 51% interest in the Property which may be exercised by:

  • Making cash payments to Firesteel totalling $300,000 over 18 months from signing;
     
  • Issuing a total of 300,000 Prosper common shares to Firesteel over a period of 18 months; and

  • Incurring exploration expenditures totalling $1,000,000 over 18 months.

Prosper has an additional option (the "Second Option") to earn an additional 19% interest, thereby increasing its total interest in the Property to 70%, which may be exercised by:

  • Exercising the First Option;

  • Making cash payments to Firesteel totalling $200,000 over 36 months from signing;

  • Issuing a total of 200,000 Prosper common shares to Firesteel over 36 months; and

  • Incurring exploration expenditures totalling $2,000,000 over 36 months.

Prosper has an additional option (the "Third Option") to earn an additional 10% interest, thereby increasing its total interest in the Property to 80%, which may be exercised by:

  • Exercising the Second Option;

  • Making cash payments to Firesteel totalling $500,000 over 48 months from signing;

  • Issuing a total of 500,000 Prosper common shares to Firesteel over 48 months; and

  • Incurring exploration expenditures totalling $2,000,000 over 48 months.

Prosper has been appointed as the operator of the Property and has the exclusive and sole responsibility of administering and carrying out the exploration programs on the Property. The Option Agreement includes standard representations, warranties and termination provisions. Additionally, the parties have agreed that upon the interests in the Property becoming first determinable, a joint venture will be deemed to have automatically formed and the parties will negotiate in good faith to enter into a formal joint venture agreement.

Michael Hepworth, President and CEO of Firesteel Resources said; "Completing the definitive agreement is the first of a number important imminent milestones for Firesteel as we get the company back on its feet. The signing of these documents provides an immediate injection of some much needed cash into Firesteel's treasury and it enables exploration to begin under the guidance of a strong, experienced and successful management team.  In turn both these benefits will begin the process of creating value for Firesteel's shareholders, many of whom have stayed with the company throughout the troubled times of the last 5 years of our history."

"Since the sale of our last company, Richfield Ventures in 2011, it has taken us two years to identify a multiple bulk tonnage Copper-Gold target area, with historical drill confirmed discoveries that met our exploration criteria for Prosper Gold," comments Pete Bernier, the Company's President and CEO. "The Sheslay Project area is close to infrastructure, drill permitted and drill ready.  We look forward to advancing the project in the near term."

About The Sheslay Property (formerly known as the Copper Creek property)

The Property is located within the Stikine Arch, a region that hosts a number of significant porphyry copper-gold deposits, including: the Red Chris Deposit containing 446,100,000 tonnes @ 0.36% Cu and 0.29 g/t Au, the recent Colorado Resources Ltd copper-gold discovery based on discovery hole NR 13-001 @ 0.63% Cu and 0.85 grams g/t Au over 242 metres and the Galore Creek Deposit @ 785,700,000 tonnes grading 0.52% Cu, 0.29 g/t Au and 4.9 g/t Ag. Firesteel's qualified person has been unable to verify the above information and it is not necessarily indicative of the mineralization on the Property.

Five permitted and drill ready mineralized copper - gold bearing porphyry bodies have been identified to date on the Property:  (Star, North Star, East Star, Copper Creek and Pyrrhotite Creek).  Four of the five porphyry bodies are clustered within a 12 square kilometre Star target area and have varying degrees of historical work completed on them by different operators from the 1970's to 2007.  The Pyrrhotite Creek porphyry appears to be located in a second distinct multiple target area to the southwest.

Field work is anticipated to commence in mid-July, inclusive of regional scale soil geochemistry, prospecting and trenching to be completed in association with a 12 square kilometre detailed IP survey.   A 5,000 metre phase - 1 drill program is scheduled to commence in early August.

Star Target

  • The Star target, based on historical exploration geophysical, geochemical and drill data, covers an approximate 700 metre by 500 metre area.  The discovery is open to depth and laterally in all directions.  Mineralization is not restricted to specific rock types; the porphyry intrusive and bounding volcanic rocks are mineralized.
  • Drilled between 2004 and 2007, 23 holes for a total 4,469 metres covering approximately a 400 metre by 400 metre surface area within the overall target area.

  • Historical drill result summary shown in the attached table:

Hole Number From (collar) To (EOH) Interval Cu Au
  m m m % g/t
CC2004-01 3.00 239.90 236.90 0.32 0.18
CC2004-01a 0.00 22.90 22.90 0.52 0.17
CC2004-02 0.00 173.10 173.10 0.41 0.17
CC2004-03 0.00 240.80 240.80 0.23 0.06
CC2004-04 0.00 108.50 108.50 0.19 0.06
CC2004-05 0.00 242.30 242.30 0.44 0.32
CC2004-06 0.00 190.20 190.20 0.41 0.22
CC2004-06a 0.00 22.00 22.00 0.33 0.17
CC2004-07 1.00 330.40 329.40 0.32 0.11
CC2005-08 3.80 145.10 141.30 0.36 0.27
CC2005-09 3.00 145.08 142.08 0.44 0.25
CC2005-10 3.65 124.05 120.40 0.28 0.11
CC2005-11 1.50 118.87 117.36 0.34 0.14
CC2005-11a 1.25 15.24 13.99 0.47 0.25
CC2005-12 1.58 122.53 120.95 0.33 0.22
CC2005-13 1.50 118.87 117.37 0.21 0.09
CC2005-14 0.91 120.40 119.49 0.06 0.06
CC2005-15 1.52 158.50 156.98 0.29 0.22
CC2005-16 3.66 134.72 131.06 0.26 0.15
CC2005-17 2.20 106.05 103.85 0.36 0.21
CC2005-18 0.00 106.68 106.68 0.32 0.28
CC2005-19 6.10 102.11 96.01 0.26 0.09
CC2007-011 2.74 337.41 334.67 0.35 0.17
CC2007-021 2.74 223.10 220.36 0.42 0.21
CC2007-03 0.00 128.66 128.66 0.37 0.13
CC2007-041 3.04 293.21 290.17 0.41 0.19

1 includes hole extensions; note that overlapping footages has occurred in some cases, due to re-entering holes in badly fractured ground.

  • Hole CC2004-05, graded a weighted average 0.44% Cu and 0.32 g/t Au over 242.3 metres.  The deepest hole, CC-2007-20B, averaged 0.35%Cu and 0.18 g/t Au over 337.4 metres.

  • Anomalously high gold and copper -in-soil anomalies directly coincide with chargeability and elevated magnetic geophysical anomalies.

  • Star surface trench results from 2004 graded 0.43% Cu and 0.25 g/tAu over 216 metres.
     
  • Approximately 300 metres southwest of the historical drill sites, two additional trenches grading 70 metres of 0.33% Cu and 24 metres of 0.51% Cu and 0.14g/tAu occur within the same host porphyry body.

Prosper Gold intends to complete a deep penetration IP survey over the entire 12 square kilometre  target area in advance of drilling off the Star porphyry on a systematic basis and to depth.

The North Star, East Star, and Copper Creek targets warrant additional surface work in advance of drill target selection.

North Star Target

  • Located approximately 1 kilometre northeast of the Star discovery.

  • Surface dimensions based on historical work indicates a strong IP chargeability anomaly and corresponding magnetic high covering a minimum 500 metre by 700 metre area with a coincident copper-in-soil anomaly (individual soil sample results above 1% Cu) and gold-in-soil anomaly (30 to greater than 220 ppb).

  • The North Star porphyry target has not been drilled tested or trenched.  The 1 kilometre gap between North Star and the Star porphyry discovery is open.  Historical anomalous gold-in-soil results suggest a possible link between the two zones.

East Star Target

  • Located approximately 1 kilometre east-southeast of the Star discovery.

  • Surface dimensions are unknown as to lateral limits.  A minimum surface target area of 500 metres by 500 metres is inferred based on patchy historical exploration results.

  • Coincident copper- and gold-in-soil anomaly highs correlate with an IP chargeability high.

  • One drill hole was attempted in 1996 but abandoned at 70 feet depth for technical reasons.  The entire target area remains untested but will require more detailed surface work in advance of a focused drill program.

  • A character surface sample collected from the showing in 1977 by Dr P Sevensma returned 0.82% Cu and 1.09g/t Au.

Copper Creek Target

  • Located 2.3 kilometres south of the Star discovery.

  • Target is defined by two side by side gold-in-soil anomalies covering 500 metre by 400 metre and 400 metre by 200 metre areas respectively, with coincident elevated copper-in-soil values overlying broad, coincident magnetic and chargeability highs and a resistivity low.

  • Marked by an extensive malachite - azurite surface gossan that appears to represent a possible large porphyry system at depth.

  • Drilled twice, in 1955-56 with four holes totaling 490 feet (149.3 metres). Core recovery was reported as poor but copper was noted in all recovered core with 1.15% over 3.4 metres reported as the highest historical intercept.

    Six holes (total 1,050 metres) were drilled in 1970 with a best intersection of 0.48% Cu over 43.6 metres.

Pyrrhotite Creek Target

  • Located 4.8 kilometres southwest of the Star porphyry, immediately east of the Kaketsa granodiorite pluton.

  • The priority drill target is a 2 kilometre long by 200 metre to 400 metre wide linear copper - in - soil anomaly, with associated elevated molybdenum values.  There is no history of gold analysis of this soil survey.  Ground magnetic and IP anomalies occur in the southern portion of the soil anomaly.

  • Historical rock chip sampling from hand trenches returned grades that averaged 0.4% Cu over 130 metres.  No historical gold analysis was done.

  • 9 Holes drilled in 1972, totaling 3,597.3 feet (1,096.4 metres); best historical intercept of 146.3 metres grading 0.32% copper.  Gold was not analyzed.  Drilling tested only the south flank of the main zone.  Several large untested geophysical and geochemical anomalies occur in the immediate area, which is presumed to be a second cluster of porphyry bodies similar on a regional scale to the Star area.

The Property has five robust drill targets with substantial indications of robust copper and gold concentrations at each. Road building for access, soil and rock sampling and trenching have been carried out as well as geophysical surveys including magnetometre, IP and EM.  Only three of the porphyry bodies have been drilled sporadically and only one, Star, tested to depth.

A three-year area based permit to build drill pads and drill from 10 sites is in place and good until March 2014. Prosper has written approval from Firesteel to use this permit.

The geological information in the news release has been verified by Paul Sarjeant, P.Geo., who is the Qualified Person for Firesteel Resources Inc. under NI 43-101.

ON BEHALF OF THE BOARD OF DIRECTORS OF
FIRESTEEL RESOURCES INC.

"Michael Hepworth"

_______________

Michael Hepworth,
President and CEO

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Advisory Regarding Forward Looking Statements

This news release contains forward-looking statements.  Users of forward-looking statements are cautioned that actual results may vary from forward-looking statements contained herein. Forward-looking statements include, but are not limited to: expectations, opinions, forecasts, projections and other similar statements concerning anticipated future events, conditions or results that are not historical facts. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". While the Company has based these forward-looking statements on its expectations about future events as at the date those statements were prepared, the statements are not a guarantee of the Company's future performance. Firesteel's potential deposits and mineralization and promising potential on its ROK Coyote property and its launch of the Transaction as disclosed in this news release (together, the "Significant Matters") and all outcomes are subject to risks, uncertainties, assumptions and other factors which could cause actual results, performance or achievements to differ materially from future results, performance or achievements expressed or implied by such forward-looking statements.  Although the Company believes that the expectations reflected for the Significant Matters in such forward-looking statements are reasonable, it cannot give any assurance that such expectations will prove to be correct. 

The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement and are made as of the date of this new release.  Unless otherwise required by applicable securities laws, the Company does not intend nor does it undertake any obligation to update or review any forward-looking statements for the Significant Matters to reflect subsequent information, events, results or circumstances or otherwise.

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SOURCE: Firesteel Resources Inc.

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