TSX-V Symbol: BCU
VANCOUVER, July 19 /CNW Telbec/ - Bell Copper Corporation (TSXV: BCU) ("Bell Copper" or the "Company") is pleased to announce that it has entered into an option agreement with Castle Resources Inc. ("Castle") whereby Castle can acquire up to a ninety percent (90%) interest in the Company's Granduc Copper Mine, located near Stewart B.C.
The Granduc Copper Mine is an historic past producing copper mine with excellent infrastructure in place. Castle has stated it intends to commission a NI 43-101 resource calculation by drill testing the down dip and strike extent of the historical deposit, then determine the economic feasibility of the project with the aim of ultimately redeveloping the mine. Initially, this will entail setting up field operations in the Leduc Valley near the historic Granduc Mine site and beginning a comprehensive diamond drill program this August.
Bell Copper and Castle have entered into an option agreement that will allow Castle to earn up to a 90% interest in the Granduc Mine and surrounding areas over a six year option period. Castle can earn an 80% undivided interest in the Granduc Mine during this period by spending $25 million and will have the option to earn an additional 10% by providing the project financing. Castle will earn a 51% interest at the end of Year 3 by spending a total of $7 million in exploration and drilling expenses.
As part of the option earn-in agreement, Castle will commit to spending a total of $25 million over six years (including $2.5 million in Year 1) and commit to spending a minimum of $2 million per year with the contingency of a one time catch up year when Castle does not spend a minimum of $2 million in the previous year. Castle has now paid $2.5 million to Bell Copper (of which $500,000 will be spent in the first year on the Granduc Mine to the credit of Bell Copper) and will pay 250,000 Castle shares per year during the 6-year life of the option (total of 1,500,000 shares). The Granduc property is subject to a 2% Net Smelter Royalty (NSR), payable to B2Gold Corp. The NSR can be purchased by Castle for $500,000 for the first one percent (1%) and $1 million for the remaining one percent (1%).
Castle is also assuming Bell Copper's option agreement with Teuton Resources Corp. ("Teuton"). Teuton will retain a 1.5 % NSR on the Silver Leduc claims and on Bell Copper's four claims to the north of the Silver Leduc claims (No. 415486, No. 415487, No. 415488 and No. 415489). Bell Copper's Granduc Crown claims are excluded. The NSR is subject to an annual advance royalty payment of $50,000 comprising cash and shares. The cash component of the advance royalty will be $25,000 and the share component will be $25,000 payable in common shares to be calculated as the average price of the shares of the Company over the previous 10 trading days prior to the annual Dec. 31 payment date.
About Bell Copper
Bell Copper is a public company with a focus on copper exploration, development and production in North America. The Company has an extensive portfolio of exploration and development projects located in some of North America's premier copper producing regions including Mexico, the Southwestern US and Northwestern British Columbia.
ON BEHALF OF THE BOARD OF DIRECTORS OF
BELL COPPER CORPORATION
CEO & Director
"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."
SOURCE Bell Copper Corporation
For further information: For further information: Bell Copper Corporation: Michael Werner, Chief Executive Officer & Director, Tel.: (604) 669-1484, email@example.com; www.bellcopper.net; Renmark Financial Communications Inc.: Christine Stewart: firstname.lastname@example.org; Jason Roy: email@example.com; Tel.: (514) 939-3989, (416) 644-2020; www.renmarkfinancial.com