OAKVILLE, ON, May 12, 2014 /CNW/ - Canoe Mining Ventures Corp. (TSXV: CLV) ("Canoe" or "Canoe Mining") is pleased to announce that it has signed binding letters of intent (the "Agreement") with Glencore Canada Corporation ("Glencore"), Rainy Mountain Royalty Corp. ("Rainy Mountain"), and Mega Uranium Ltd. ("Mega Uranium") to purchase a 100% interest in the Hamlin-Deaty Creek Property (the "Property") located in the Shebandowan Belt 110km west of Thunder Bay, Ontario.
Duane Parnham, a director of Canoe Mining stated: "The Hamlin property compliments our current holdings and furthers our strategic objective to consolidate the Shebandowan copper gold belt into a single major mining camp. There are currently unprecedentedly low acquisition costs for metal deposits in Canada and this, together with a trend for major mining companies to divest their exploration and development projects, has enabled Canoe Mining to capitalize on current market factors and acquire a highly prospective project from Glencore. We envision that Canoe will benefit from being well positioned with an excellent copper gold mining project in the future when markets will potentially recognize a significant increase in this property's valuation and reward Canoe for its efforts to enhance this asset."
Current ownership of the Property is held in a joint venture between Glencore, Mega Uranium, and Rainy Mountain where Glencore is the operator and owner of a 51% interest, with Rainy Mountain and Mega Uranium each holding a 24.5% interest. The Property was initially acquired by East West Resource Corporation (now Rainy Mountain) in 2003 and a partnership was formed with Mega Uranium to explore and develop the Property. A total of 58 diamond drill holes were completed by 2006 which traced a 900m long and 100m wide breccia zone containing copper, gold, silver and molybdenum mineralization. In 2011, Xstrata Copper (now Glencore) earned a 51% interest by spending $3.0 million in addition to the $1.5 million spent by previous operators. During 2009 to 2011, Xstrata Copper completed 23 drill holes, for a total of 7763m, which extended the deposit down to 200m below surface.
R.S. Middleton, P.Eng, Canoe Mining's Exploration Manager, led the team that made the original discovery of the Hamlin deposit and has since sponsored students to complete their thesis work on details of the geology and mineralogy of the Property. Mr. Middleton stated: "I am deeply familiar with the Hamlin property and deposit and know first-hand the potential of this Property. Our objective is to build a 60-100 million tonne copper-gold-silver deposit similar to the producing Mount Polley Mine in BC (Imperial Metals), or the Troilus Mine near Chibougamau (Inmet now First Quantum)."
Pursuant to the terms of the Agreement, and subject to the receipt of all required regulatory and exchange approval, in consideration for the Property Canoe Mining has agreed to make a cash payment of $50,000 to Glencore and grant Glencore a 1% net smelter royalty ("NSR") together with a right of first refusal for an off-take agreement. Additionally, Rainy Mountain and Mega Uranium will each be issued one million common shares of Canoe Mining.
The underlying 2% NSR held by the original vending prospectors may be purchased by Canoe Mining under the following terms: a 1% NSR may be purchased at any time for $1.0 million, and Canoe Mining has the first rights of refusal to purchase the remaining 1% NSR.
This project will be supervised by R.S. Middleton, P.Eng who is a qualified person as such term is defined in NI 43-101 and who has reviewed and approved the technical information and data included in this press release.
Iron Lake Gold Project
Canoe Mining also announces that it issued 125,000 shares to 2099840 Ontario Inc. o/a Emerald Geological Services ("Emerald") in April 2014 pursuant to an ongoing option agreement relating to the Iron Lake Gold Project. Canoe Mining may issue an additional 125,000 shares to Emerald in April 2015 pursuant to the terms of this option agreement.
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 news release.
On Behalf of the Board of Directors of Canoe Mining,
Duane Parnham, Director
Forward Looking Statements
This news release includes certain forward-looking statements or information. All statements other than statements of historical fact included in this release or other future plans, objectives or expectations of Canoe Mining Ventures Corp. are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Canoe's plans or expectations include risks relating to the actual results of current exploration activities, fluctuating gold prices, possibility of equipment breakdowns and delays, exploration cost overruns, availability of capital and financing, general economic, market or business conditions, regulatory changes, timeliness of government or regulatory approvals and other risks detailed herein and from time to time in the filings made by Canoe with securities regulators. Canoe expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise except as otherwise required by applicable securities legislation.
SOURCE: Canoe Mining Ventures Corp.
For further information: Luke Vigeant, Manager, Investor Relations, Canoe Mining Ventures Corp., Tel: 1.905.844.7612, Email: [email protected]