Sep 15 2015
COLORADO RESOURCES LTD. ("Colorado" or the "Company") announces that it has entered into an option agreement ("the Agreement") with Centerra Gold Inc. ("Centerra") whereby Centerra can earn a 70 % interest in the Heart Peaks (HP) Gold Project through making exploration expenditures totalling CAD$8.0 million by December 31, 2019.
Adam Travis, President and C.E.O of Colorado states, "We are very pleased to welcome Centerra to B.C and to have the opportunity to partner with a strong mid- tier gold producer who not only shares our enthusiasm for the exploration opportunities at HP but also our commitment to responsible mineral exploration and respectful, mutually beneficial discussions and opportunities for local communities and First Nations."
The Agreement
Under the terms of the Agreement Centerra can earn a 70% interest by funding a total of CAD$8.0 million in exploration expenditures on the HP Project before December 31, 2019. Colorado will be the project manager on the HP Project for a minimum of two years and will receive a management fee. Once Centerra earns its 70% interest, a joint venture will be formed for the HP Project between Colorado and Centerra, and parties will be responsible for further contributions towards exploration expenditures on a pro rata basis, or be diluted accordingly. Should either party dilute to a 10% interest or less, their joint venture interest will be converted to a 2% Net Smelter Royalty of which one half can be purchased by the non-diluting party for CAD$2.0 million.
The HP Project
The HP Project is located approximately 45 kilometres northeast of the previously producing Golden Bear Mine in northwestern British Columbia. The HP Project covers one of B.C's largest felsic volcanic centers and shares many geological similarities with young volcanic centres in Nevada and globally which host multi-million ounce low sulphidation epithermal gold deposits.
At HP felsic volcanic rocks have been highly altered over a large 20 km square area within which at least 7 surface gold showings (see Figure 1) have been found to date. Gold mineralization is focused along two lithologically and structurally defined corridors: the east-west trending 2 km long Top Zone to Midas Zone corridor and the north trending 3 km long corridor bounded by the Mogul East and Mogul West fault systems.
Gold values in surface grab samples as high as 126 g/t gold indicate there is very good potential to find high grade mineralization at shallow to moderate depths at Heart Peaks. In addition, historical drill testing, which returned intersections of up to 0.51 g/t gold over 115 metres in drillhole 84-4 (Daley, 1985), also demonstrates that the Heart Peaks hydrothermal system is robust enough to generate broad zones of lithologically controlled bulk tonnage style gold mineralization.
Previous work by Colorado in 2011 and 2012 included detailed geological mapping, soil and rock sampling, alteration and Terraspec mapping along with 12 km of I.P geophysics. This work suggests that some of the best targets have not yet been drill tested.
Exploration fieldwork on the HP Project is scheduled to commence shortly and is expected to include expansions of the soil geochemical and I.P geophysical surveys to cover open ended targets along with detailed geological and alteration mapping in preparation for finalizing proposed drill sites.
The rock and soil samples reported by Colorado in 2012 were analyzed by Agate Laboratories Ltd of Mississauga, Ontario. Samples were analyzed for 46 elements using an Aqua Regia Digest with an ICP‐OES finish (AGAT Analysis Code 201073) and for gold by fire assay fusion with an AAS finish (AGAT Analysis code 202051).
For more information on the Heart Peaks (HP) Project the reader is directed to the company's website at www.coloradoresources.com.
To view Figure 1, please visit the following link: http://media3.marketwire.com/docs/HP_Project_Map.pdf
Qualified Person
Greg Dawson, P.Geo is the Qualified Person as defined by National Instrument 43-101 who supervised the preparation of the technical data discussed in this news release.
ON BEHALF OF THE BOARD OF DIRECTORS OF
COLORADO RESOURCES LTD.
Adam Travis, President and Chief Executive Officer
Source: http://www.coloradoresources.com/