StrikePoint Gold Inc.: SKP TSX-V
San Gold Corporation: SGR TSX-V
CALGARY, Sept. 17 /CNW/ - Dale Ginn, CEO of San Gold Corporation ("San Gold") and Richard Boulay, CEO of StrikePoint Gold Inc.("StrikePoint Gold") (collectively, the "Parties") are pleased to announce that San Gold and StrikePoint Gold have entered into a letter agreement (the "Letter Agreement") setting forth the terms and conditions of a transaction (the "Option") whereby San Gold can earn a 50% undivided interest in the Strike Point property that lies adjacent and to the north and northwest of San Gold's mining lease that contains the Rice Lake Mine, the Cartwright deposit and the high grade gold Hinge Mine and Cohiba Zones. Pursuant to the Letter Agreement the parties have agreed to negotiate a subsequent definitive option agreement (the "Option Agreement").
The Letter Agreement provides that San Gold shall pay StrikePoint Gold a refundable advance deposit (the "Advance Deposit") of $150,000 cash upon execution of the Letter Agreement. In addition, San Gold shall pay StikePoint Gold $50,000 cash on the first anniversary of the execution of the Letter Agreement and shall conduct $1,500,000 in exploration work on the property over three years at a minimum rates of $400,000, $500,000 and $600,000 per year, respectively, to earn a 50% undivided interest in the Strike Point property. The Advance Deposit shall be refunded by StrikePoint to San Gold in the event that the Option Agreement is not executed by December 31, 2009 or such other date that is agreeable to both parties.
StrikePoint Gold will be the operator of the project subject to a standard joint venture operating committee structure. StrikePoint Gold shall have the right to accelerate exploration by spending its own funds and an amount equal to such expenses shall be added to San Gold's work requirement for the year in which they are expended. When San Gold has earned its 50% interest, both parties shall become working parties, each responsible for 50% of expenditures, subject to standard dilution provisions. San Gold and StrikePoint Gold shall each have 90 days to remedy any shortfall to prevent dilution. Each Party to the Option Agreement shall have a first right of refusal to purchase the other Party's interest. San Gold and StrikePoint Gold will agree that no Party shall purchase any common shares of the other Party without the approval of both boards of directors, during the existence of the Option Agreement or for a period of two years following the termination of the Option Agreement or ensuing joint venture agreement. The proposed Option Agreement between San Gold and StrikePoint Gold is a Reviewable Transaction as defined in TSX Venture Exchange Policy 5.3 since Richard A. Boulay and Courtney Shearer are directors and officers of StrikePoint Gold and directors of San Gold.
The Strike Point property consists of twenty six claims covering 3595 hectares adjacent to the northwestern boundary of San Gold's Rice Lake gold mine and mill property at Bissett, Manitoba, located a 3 hour drive from Winnipeg. During 2008, StrikePoint Gold conducted mapping and prospecting activities on the Strike Point property and added six more claims to the original 20 claims to cover new showings to the north. The Strike Point property is underlain by Archean volcanic rocks that are identical to or similar to the hanging wall volcanic rocks that host San Gold's Hinge and Cohiba zones. As well, an embayment of volcanic rocks extends northward across the regional Wanipigow Shear where it contains mafic volcanics and interbedded iron formations that remain largely unexplored. More importantly, the hanging wall volcanics of the southern part of the Strike Point property contain structural elements that are identical or similar to the structures that host San Gold's Hinge and Cohiba zones. Significantly, the Strike Point property contains the western 5 kms of a 10 km long faulted fold axis that extends eastward from Horseshoe Lake to the San Gold No. 1 mine. This important 10 km long structure is considered to be a possible mineralization conduit for the multiple parallel Hinge Structures on the San Gold mining lease.
During 2008 and early 2009, a new exploration strategy was developed to explore various properties in the central part of the Rice Lake Gold belt as well as properties at the distal ends of the belt to the east and west. The new strategy is based on the fact that San Gold's newly discovered high-grade Hinge and Cohiba zones located in the thick hanging wall volcanic sequence consists of pure gold and very sparse associated sulphides lodged in thick, pure quartz veins that intrude highly siliceous volcanic rocks. Consequently, with no geological contrast, the gold bearing veins are not identifiable using standard magnetic, electromagnetic or resistivity methods. During 2008, it was established that San Gold's high grade Hinge Zone mineralization was structurally controlled. Consequently, StrikePoint Gold and San Gold flew a 580 square kilometre very high resolution LiDAR Survey in May 2009. LiDAR (Light Detection and Ranging) generates large amounts of data in a data "pointcloud" from which can be extracted various datasets that can be used for structural information, including very accurate digital elevation models. StrikePoint Gold is currently processing the data for the central part of the belt, primarily the San Gold mine lease and the adjacent Strike Point property. Initial test work by StrikePoint Gold geologists using initial LiDAR products indicates that the data is effective at delineating detailed structure, even in swampy terrain.
Dale Ginn, San Gold's CEO stated: "As a result of this joint venture, all of the hanging wall volcanics that host the high grade Hinge deposits, together with their important structural elements are now accessible to San Gold, at surface as well as possible important western and northern extensions." Richard Boulay, CEO of StrikePoint Gold noted: "This agreement consolidates the Central Rice Lake Belt structural domain that has hosted over 95% of the Rice Lake Belt's recent and historic gold production. San Gold's recent high grade gold discoveries have greatly expanded the volumetric potential of the Rice Lake sequence stratigraphically upward to incorporate the volcanic rocks of the Strike Point property."
StrikePoint Gold currently has one of its geological teams dedicated to the Strike Point property. San Gold and StrikePoint Gold will immediately convene a technical committee to establish a systematic exploration protocol for the Strike Point property.
Sample LiDAR images can be viewed on the graphical version of this press release at www.sangoldcorp.com or www.strikepointgold.com.
This press release has been reviewed by D. Ginn, P.Geo., San Gold's Qualified Person for this project under National Instrument 43-101 and by Daniel A. Beauchamp, B.Sc., P.Geol., StrikePoint Gold's Qualified Person under National Instrument 43-101.
Neither the 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. This news release may contain assumptions, estimates, and other forward-looking statements regarding future events. Such forward-looking statements involve inherent risks and uncertainties and are subject to factors, many of which are beyond the Company's control, which may cause actual results, performance or circumstances to differ materially from those currently anticipated in such statements.
SOURCE StrikePoint Gold Inc.
For further information: For further information: Dale Ginn, CEO of San Gold Corporation, at (204) 794-5818; Richard Boulay, CEO of StrikePoint Gold Inc, at (403) 243-9500; or investor information at 1-800-321-8564