VANCOUVER, April 15 /CNW/ - Merit Mining Corp. ("Merit") (TSX-V: MEM) is
pleased to report that it has entered into an option agreement to acquire a
100% undivided interest in the J & L Property from the Estate of Theodore E.
Arnold, of Connecticut, U.S.A., subject to TSX Venture Exchange and U.S. court
approval. The J & L Property is located 35 kilometres north of Revelstoke,
British Columbia, Canada.
The J & L Property represents one of the largest undeveloped polymetallic
deposits in British Columbia. The 2,325 hectare property has two known and
significant polymetallic and precious mineral deposits. The Main Zone is a
stratiform, structurally controlled polymetallic base and precious metal
(Au-Ag-Zn-Pb) massive sulphide deposit. Historic underground drilling has
defined the Main Zone for a 1.4 kilometre strikelength. Surface exploration
has traced the Main Zone for 3 kilometres. The Main Zone averages 2.5 metres
thick. The Yellowjacket Zone is a very siliceous Zn-Pb-Ag stratabound deposit
that sub parallels and is in the immediate hangingwall of the Main Zone.
Several major mining companies, including Asarco, BP-Selco, and Noranda
have explored and advanced the Main Zone, while Cheni Gold Mines discovered
the Yellowjacket. A total of 197 diamond drill holes have been completed on
the property from 1983 to 1997 (21,926 metres). Underground development is
comprised of 2.0 kilometres of drifting, cross cuts and raises with the Main
Zone exposed for a distance of 0.85 kilometres along the drift.
The Company has received a technical report titled "J & L Property
Technical Report", dated April 13, 2007, authored by David K. Makepeace,
P.Eng., independent Qualified Person, of Geospectrum Engineering. The report
will be filed on sedar (www.sedar.com) shortly.
The Main Zone has an historic resource which was prepared by Equinox
Resources Ltd. in 1991 as "Proven and Probable Ore Reserves" of 1.7 million
tonnes grading 7.38 g/t gold, 75.9 g/t silver, 2.64 % lead and 4.43 % zinc and
an historic "Possible Ore Reserve" of 1.9 million tonnes grading 7.12 g/t
gold, 85.5 g/t silver, 3.32 % lead and 3.48 % zinc. Merit has not prepared nor
confirmed this resource estimation and as it pre-dates National Instrument
43-101, it does not comply with NI 43-101 requirements for mineral resource
estimation. Merit and Mr. Makepeace do not treat these numbers as a current
resource on the property and the resource should not be relied upon, but
remains a historic figure. In Mr. Makepeace's opinion, the historic "Proven
and Probable Ore Reserve" category would likely be equivalent to an "Indicated
Mineral Resource" category and the historic "Possible Ore Reserve" category
would likely be equivalent to an "Inferred Mineral Resource" category under
the current CIMM classification (CIM Definition Standards, 2004).
The Yellowjacket historic resource estimate was completed by Equinox
Resources Ltd. in 1991. The historic 1991 "Probable Ore Reserve" category
estimate was 693,000 tonnes grading 52.3 g/t silver, 2.45 % lead and 7.06 %
zinc and the historic "Possible Ore Reserve" category estimate was 337,000
tonnes grading 53.1 g/t silver, 2.50 % lead and 7.15 % zinc. Merit has not
prepared nor confirmed this resource estimation and as it pre-dates National
Instrument 43-101, it does not comply with NI 43-101 requirements for mineral
resource estimation. Merit and Mr. Makepeace do not treat these numbers as a
current resource on the property and the resource should not be relied upon,
but remains an historic figure. In Mr. Makepeace's opinion, the historic
"Proven and Probable Ore Reserve" category would likely be equivalent to an
"Indicated Mineral Resource" category and the historic "Possible Ore Reserve"
category would likely be equivalent to an "Inferred Mineral Resource" category
under the current CIMM classification (CIM Definition Standards, 2004).
Verification drilling and sampling will be required in order to justify a
NI 43-101 compliant resource estimate on either the Main Zone or Yellowjacket
deposits. It is apparent that both the Yellowjacket and particularly the Main
Zone have potential to expand the deposits beyond the limits of the current
drilling. The deposits are open in a number of directions. The Main Zone, with
its tabular, predictable geometry and grade, and demonstrated and interpreted
lateral extent suggests considerable opportunity to expand its size.
Weymin Mining Corporation (1979-1999) and BacTech Mining Corporation
(2005) performed metallurgical test work on the Main Zone, which demonstrated
a number of effective options for achieving acceptable recoveries of gold,
silver, zinc, and lead using heavy media separation and a three-product
flotation process. No metallurgical test work has been performed on the
Under the terms of the option agreement, Merit may acquire a 100%
undivided interest in the J & L Property by making payments totaling
$10.79 million over a 7 year period. Within the first year of the option
agreement, Merit may acquire an 85% interest in the property by making cash
payments totaling $5.0 million and by issuing 275,000 common shares. To retain
its 85% interest and acquire the remaining 15% interest in the property, Merit
must make payments totaling $5.79 million, in the form of cash payments and
semi-annual advanced royalties and/or production royalties. In addition, Merit
must issue 125,000 common shares annually until the earlier of the
commencement of Commercial Production or the payment of the $5.79 million.
Mr. Makepeace, in his technical report, has recommended a two phase
$2,170,000 program of surface drilling, underground rehabilitation and
development, and underground drilling.
Within the next 12 to 15 months, the Company plans to conduct the
recommended programs, complete NI 43-101 resource estimates on the deposits
and complete a preliminary economic assessment on the project.
Mr. Paul Cowley, P.Geo., VP Exploration and director of the Company,
non-independent Qualified Person, and Mr. David K. Makepeace, P.Eng.,
independent Qualified Person, have read and approved the contents of this news
Fred Sveinson, President & CEO says "The J & L Property adds a second
advanced stage project to our portfolio, which already includes the Greenwood
Gold Project, currently being advanced to production.
The Company can capitalize on current high metal prices and the
considerable work carried out on the J & L by previous operators, including
the identification of practical metallurgical processes. We look forward to
also advancing the J & L to production."
Merit Mining Corp.
Signed "Fred Sveinson"
Fred Sveinson, President & CEO
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
The statements made in this News Release may contain certain
forward-looking statements. Actual events or results may differ from the
Company's expectations. Certain risk factors may also affect the actual
results achieved by the Company.
For further information:
For further information: please contact: Fred Sveinson at (604)
694-2344; For Investor Relations Information Contact: MarketSmart
Communications, (604) 261-4466 or 1-877-261-4466