Castillian Resources Corporation (TSX VENTURE:CT) has announced that it has entered into a letter agreement with Alder Resources Ltd. to acquire the right to acquire 60% interest in the Canadian Creek Gold property located in the Whitehorse Mining District.
The Propery consists of 309 claims covering approximately 6,180 hectares located 160 kilometres south of Dawson in the highly prospective Tintina Gold Belt in central Yukon and approximately 50 kilometres southeast of the White (Underworld/Kinross) gold discovery and 25 kilometres southeast of the Coffee (Kaminak) gold discovery. The very large tonnage low grade Casino copper-gold-molybdenum porphyry deposit owned by Western Copper is located immediately east of the property (see attached figure). Alder acquired its interest in the Property pursuant to an option agreement (the "Option Agreement") dated June 11, 2009 entered into between Alder and Cariboo Rose Resources Ltd. (the "Optionor") under which Alder had an otion to acquire a 60% interest.
Bill Pearson, President & CEO of Castillian, commented: "This is an excellent acquisition for Castillian in what we consider to be a prime property in a major emerging gold belt in Yukon. Only recently has exploration focused on finding the newly discovered White-Coffee-style gold mineralization. Diamond drilling by previous operators has confirmed significant gold mineralization and geochemical sampling by Alder has outlined an extensive gold soil geochemical anomaly that extends for approximately 4 kilometres in the northeast part of the property. In addition analysis by Castillian geologists has identified other target zones on the Property that warrant follow up. Over the winter we plan to compile all available data in order to lay out a focused exploration program to evaluate priority target areas in 2011."
In consideration for the acquisition of the right to earn a 60% interest in the Property, Castillian agrees to pay Alder an aggregate cash fee of $250,000 and to issue to Alder that number of common shares of Castillian (the "Common Shares"), which in the aggregate shall equal $1,000,000 over a three (3) year period as follows:
In addition, the parties shall enter into an assignment agreement with the Optionor in accordance with the terms of the Option Agreement (the "Assignment Agreement"). The Assignment Agreement shall provide that in addition to the obligations to be assumed by Castillian as described above, Castillian shall: (i) on the third anniversary of the Option Agreement, being June 18, 2012, at its sole option make a cash payment of $60,000 and issue to the Optionor 50,000 shares or that number of Common Shares which are equal in value to $15,000; and (ii) on the fourth anniversary of the Option Agreement, being June 18, 2103, at its sole option, shall pay the Optionor $100,000 and issue 100,000 shares to the Optionor or that number of Common Shares which are equal in value to $30,000. Castillian will be required to carry out exploration on the property totalling $1, 4250,000 by June 18, 2013.
Completion of the acquisition is subject to the satisfactory completion of a 30 day due diligence period, and receipt of all required regulatory and securities approvals, including the approval of the TSX Venture Exchange, along with other customary closing conditions.
Source: Castillian Resources Corp.