May 31 2013
Estrella Gold Corporation ("Estrella" or the "Company") reports that it is moving ahead with project exploration and the search for new projects. Estrella has also implemented an ongoing program of operating cost reductions through reductions in administration costs and property holding costs.
The Company is now looking forward to focusing on moving its projects ahead which are under option or joint venture agreements (4 properties) and acquiring new projects to advance and option out to third parties for exploration.
Estrellla's team in Peru, led by Mr. John Wilson, President and CEO, has recently met with our JV partners - Cliffs Natural Resources Exploration Inc. (Yanac Project), Mines Management, Inc. (La Estrella Project) and Lara Exploration Ltd. (Isy Project). Mr. Wilson has been in contact with partner Esperanza Resources Corporation (Pucarana Project).
- Exploration work is planned for the Yanac Project and will be funded by Cliffs. Further updates will be provided in the coming months as exploration progresses. Cliffs and the Company formed a 50-50 JV in February 2013 and Cliffs must spend a firm commitment of US$500,000 in year one on exploration or pay the same amount to the Company, with an additional work or payment amount of US$250,000 required to maintain Cliffs' interest beyond year one.
- The La Estrella Project funded by Mines Management will continue exploration for a second year. Mines Management is currently awaiting permits to accommodate an expanded area for drilling. The year 2 expenditure requirement is US$500,000 as part of a total of US$5 million to be spent on exploration and US$600,000 in cash payments to be made, along with the preparation of a preliminary economic assessment on a defined resource, to earn a 75% interest in the project by March 4, 2016. Per the agreement, Estrella's 25% interest is carried to production with proportionate costs paid back to Mines Management from production profits.
- Estrella's Isy project makes up a part of the Sami Project owned by Lara Exploration. Lara Exploration has an option to purchase the Isy claims from Estrella by paying US$80,000 (paid) and US$175,000 over the next two years, and issuing 50,000 shares to Estrella. Estrella will also receive a 1.5% NSR on the project.
- Esperanza's (60%) Joint Venture with Estrella (40%) on the Pucarana Project is approximately 7 kilometers from Buenaventura's high-grade underground Chipmo Mine and 15 km from the Poracota mine which has become one of the largest gold producers in South America. Estrella is currently in the process of finalizing a 60-40 joint venture agreement with Esperanza on the Pucarana project.
The geological team in Peru is also active in looking for new projects to acquire as companies drop projects due to lack of financing and good properties become less expensive to acquire.
Further updates on the exploration programs and results, property acquisitions and dispositions, and options agreements will be provided as they are completed.
After the Annual General Meeting yesterday morning, Mr. John Wilson (Geologist) was re-appointed as the President and CEO and Ms. Winnie Wong (Chartered Accountant) was re-appointed as the Chief Financial Officer and Corporate Secretary. The directors were appointed as expected with Mr. Greg Harris, Chairman, (Lawyer), Mr. Don Taylor (Geologist), Mr. Mark Brown (Financier), and Mr. Fernando Pickmann (Peruvian Lawyer) being re-appointed and Mr. Wilson be appointed as a new director.
The shareholders also approved changing the Company's 20% fixed stock option plan to a 10% rolling stock option plan which limits and reduces the number of stock options to 10% of the outstanding common shares from the old 20% amount.
The Board of Directors also approved the grant of 1,455,000 stock options to directors, officers, employees and consultants of the Company which allow the holders the right to purchase a common share of the Company at a price of $0.08 per share no later than May 29, 2017 or for 4 years from the date of the grant.
Source: http://www.estrellagold.com/