MARIFIL MINES LTD. (TSX VENTURE:MFM) announces that it has entered into an agreement with Netco Energy Inc. whereby NEI can earn up to a 75% interest in Marifil's Toruel property.
Under the terms of the agreement, NEI can earn a 50% interest during the next three years by paying an aggregate of $200,000 in cash, issuing 3,150,000 NEI common shares to Marifil and making work expenditures of $2,800,000 on the Property. NEI can earn a further 10% over the next two years by providing Marifil with a pre-feasibility study on the Property and paying the Company $100,000 per year. NEI can earn a further 10% over the next two years by providing Marifil with a feasibility study on the Property. At that time, all further expenditures shall be shared, with 70% covered by NEI and 30% by Marifil. However, at Marifil's sole option, the Company can elect to be carried through to the commencement of commercial production on the Property, in which case NEI will earn an additional 5% interest, bringing its interest to 75%.
In the event NEI fails to provide the Company with a feasibility study in the allotted time then, at Marifil's option, NEI's interest may be reduced to 49%.
The Property is located about 25 kilometers southeast of the village of Los Menucos, Rio Negro Province, Argentina. The targets on the Property are epithermal veins and vein breccias containing high grade silver and copper values along with important amounts of gold and indium. More than 20 veins have been identified within a structural corridor 4 to 5 kilometers wide and more than 7.8 kilometers long. Many large veins remain untested.
Marifil has completed 5,890 meters of drilling, most of it along the Toruel vein. The main Toruel vein has been traced for 1,900 meters along strike with widths up to 15 meters. Drill hole DDH-32 cut 6.7 m (true width 4.0 m), grading 1,900 g/t silver and 5.3% copper.
Mr. John Hite reports, "This is now the sixth transaction completed by Marifil in the last nine months. Four of these are joint ventures and two are outright sales. In total we expect to take in more than $1 million in cash and more than $1 million in marketable securities in 2011. Over the next few years our partners will be spending almost $20 million in direct property costs and will also, in several cases, be providing us with pre-feasibility and feasibility reports. Our strategy of farming out our properties while retaining significant carried, or working interests and/or royalties is working and should result in gains for our investors."
This press release has been reviewed and approved by John Hite, President of Marifil Mines Ltd., and by Richard Walters, Vice President, under whose directions the exploration program is being carried out. Mr. Hite and Mr. Walters are Qualified Persons as defined by National Instrument 43-101.
Source: MARIFIL MINES LTD.