Firesteel announces LOI with Lions Gate for $3.6 million option on the Rok
Coyote property
Trading Symbol: FTR-TSX: V
Terms of the LOI
Under the terms of the LOI, Lions Gate will be granted an Option to acquire a seventy-five percent (75%) interest in the Property for an aggregate consideration of
It is intended by the parties that the LOI will be superseded by a formal mineral lease option agreement within 45 days. Lions Gate and Firesteel will provide further updates by way of news releases when a formal agreement is signed. This LOI is entered into subject to approval of the TSX Venture Exchange ("TSX-V").
An initial cash payment of
Firesteel retains the right to acquire a five percent (5%) interest in the Property at any time following the date which is three years after the Option is approved by the TSX-V and until a production decision is made concerning the Property for total consideration of
About the Property
The Property consists of 19 mineral claims covering an area of 6,891 Ha. It is divided into two blocks earned or under option by Firesteel from previous claim holders, each with 2% Royalty obligations; one block in an area of common interest with a 0.5% Royalty obligation; and a fourth block with no previous Royalty obligation.
This Property is situated in the Stikine Arch region of northwestern B.C. about 8 kilometers southeast of the Iskut Village and just east of Highway 37. The Property is adjacent to and immediately northwest of the Imperial Metals Red Chris copper-gold deposit (with measured and indicated resources of 446.1 million tonnes at 0.36% Cu and 0.29 g/t Au, at 0.20% Cu % Cutoff, as reported on page 52 of Imperial Metals' Annual Information Form dated
A National Instrument 43-101 compliant report was prepared for Firesteel in 2006 entitled "Technical Report on the ROK Copper-Gold Mineral Property, Ealue Lake Area, Liard Mining Division, British Columbia,
The Company had established a 2010 exploration program consisting of extending the geophysical grid to the West to cover the entire Th/K anomaly, conducting additional IP chargeability and resistivity readings over the entire grid and possibly drilling up to 1500 meters of drill holes to follow up findings from this program. However, due to continuing soft demand for equity in early stage junior minerals companies, Firesteel has been unable to raise sufficient financing for this project. Thus, the Company had decided to seek a partner to continue the pace of development. In 2009 Firesteel had entered into a letter of intent on the Property with another counterparty who could not be identified due to the terms of that agreement. That letter of intent had expired by its own terms.
With the Company's spending commitments now deferred on the Property for up to four years Firesteel intends to focus its resources on its flagship Copper Creek Property. The Company continues to seek a partner for its Poker property in B.C. and is maintaining its position for strategic reasons in its NWT and Mexican properties.
On announcing this transaction
Lions Gate is a Canadian based, junior resource company focused on the exploration, development, and acquisition of both advanced and early stage mineral projects. Lions Gate owns 100% of three substantial copper and molybdenum projects located in British Columbia. Lions Gate's flagship project is the Poplar porphyry copper - molybdenum deposit.
Firesteel is a junior minerals exploration company which explores for and develops quality precious and base metal prospects in the resource rich Stikine Arch area of British Columbia, and in the NWT and
ON BEHALF OF THE BOARD OF DIRECTORS OF FIRESTEEL RESOURCES INC. "Walter Wakula" ----------------------- Walter Wakula, 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 which include, but are not limited to: statements regarding the Company's plans to complete a definitive agreement with Lions Gate, receive future cash or shares from Lions Gate, complete the joint venture, realize the expected exploration work obligations committed on the Property, future drilling, expectations for exploration prospects, as well as operations plans, outlook, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although Firesteel believes that the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurance that such expectations will prove to be correct. Results of the Company may be affected by a variety of variables and risks associated with mineral exploration such as imprecision of resource and reserve estimates, environmental risks, competition, ability to access sufficient debt and equity capital from internal and external sources, ability to generate sufficient cash flow from operations to meet its current and future obligations, and risks associated with existing and potential future lawsuits and regulatory actions made against the Company; as a consequence, actual results could differ materially from those anticipated or implied in the forward-looking statements.
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 news 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 to reflect subsequent information, event, results or circumstances or otherwise.
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