Metalex partners with Dundee to develop U2 kimberlite pipe

KELOWNA, BC, March 15, 2013 /CNW/ - Metalex Ventures Ltd. (TSXV : MTX) ("Metalex", the "Company") is pleased to announce the signing of the earn-in agreement with Dundee Corporation ("Dundee") wherein Dundee or its designate can earn up to a 51% interest in the U2 and T1 kimberlite pipes (the "Project") through a four stage investment of up to CAD$51 million.

First Right - $5 million convertible loan

As per the letter agreement signed on January 15, 2012 Dundee advanced a $5 million interest free loan to Metalex.  The funds will be used for preparatory work for the 10,000+ ton bulk sample.

Once the amount provided under the loan has been expended, Dundee will be deemed to have earned a 5% interest in the Project ("First Election"), which it shall have the option to convert into Metalex shares at $0.90 per share.

Second Right - $12.5 million to earn a further 12.5% interest

If Dundee makes the First Election, it will be committed to invest a minimum of a further $12.5 million (in addition to the $5 million loan), commencing one month after receipt by Metalex of the final permitting for the 10,000+ ton bulk sample.  Should Dundee and Metalex agree on a budget of greater than $12.5 million Dundee shall earn an additional 1% interest for each $1 million spent over and above $12.5 million ($17.5 million inclusive of the $5 million loan).  Once payment is received, Dundee will hold a minimum of a 17.5% interest in the Project and will have earned its Second Right and may undertake its Third Right.

Third Right - Up to $22.5 million to earn a 40% interest

Under the Third Right investment, Dundee will make a further payment to bring its total contribution to $40 million which will bring its interest to 40%.  During this phase, Dundee will incrementally earn a 1% interest in the Project for each $1 million spent.

Fourth Right - $11 million to earn a 51% interest

Upon the Fourth Right investment of an additional $11 million ($51 million total) Dundee will have earned a 51% interest in the Project.  These funds are to be used to complete a feasibility study on the Project.  If the feasibility study is positive, Dundee will use its reasonable commercial efforts to secure funding for the development of the mine to commercial production within four years.  Metalex's and Dundee's respective portions of mine development costs are to be repaid from 80% of each of their respective shares of free cash flow from the mine.

U2 Profile

The U2 kimberlite pipe is a highly prospective diamond development project located in the James Bay Lowlands of Ontario, near De Beers' Victor Mine.  Diamonds recovered from the U2 pipe are of exceptional quality - with 88.8% by weight of the +1.7mm diamonds being white and 1.1% being colored.  The large size of the U2 pipe shows the potential to host a substantial tonnage.

Currently the Project is awaiting two key permits which will allow the construction of 60 kilometers of winter road from the Victor Mine site across to the U2 project.  Though the applications were submitted to the Ministry of Natural Resources in Cochrane for these permits on January 30, 2012 and March 26, 2012 the permits have yet to be received.  With the winter road season rapidly coming to an end it is highly probable that the mobilization of the equipment and supplies needed to conduct the program will only occur during the winter of 2013/2014.

The technical information and results reported here have been reviewed by Mr. Chad Ulansky, P.Geol., a Qualified Person under National Instrument 43-101, who is responsible for the technical content of this release.

The agreement with Dundee remains subject to regulatory acceptance.


Charles Fipke

Charles Fipke

Forward Looking Statements

Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties.  Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various risks.  The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events may differ materially from those anticipated in such statements.  Metalex undertakes no obligation to update such forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on such forward-looking statements.

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: Metalex Ventures Ltd.

For further information:

Chad Ulansky, President & CEO, +250-860-8599,

Profil de l'entreprise

Metalex Ventures Ltd.

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