Sierra Madre Developments and Omineca Mining and Metals Announce Signing of an Option to Purchase the Harrison Gold Property
November 21 2011 - 11:36AM
Marketwired
Sierra Madre Developments Inc. ("Sierra Madre" or the "Company")
(TSX VENTURE:SMG) is pleased to announce that the Company has
signed an Option to Purchase Agreement with Omineca Mining and
Metals Corp. ("Omineca" or the "Vendor") (TSX VENTURE:OMM) whereby
Sierra Madre can acquire a 100% interest in the 2,427 ha Harrison
Gold Project (also referred to as the Abo project) located in south
western BC.
To exercise the Option, SMG must, on or before the fifth
anniversary of TSXV approval, (a) pay to the Vendor an aggregate
$1,000,000; (b) deliver an aggregate of 4,000,000 common shares of
Sierra Madre; and (c) incur an aggregate of at least $3,000,000 of
expenditures on the Property, as follows:
(a) pay to the Vendor:
(i) the sum of $25,000 upon the date of signing the Agreement;
(ii) an additional $25,000 within ten days following receipt of TSXV
approval to the Agreement (the "Approval Date");
(iii) an additional $50,000 on or before the first anniversary of the
Approval Date;
(iv) an additional $100,000 on or before the second anniversary of the
Approval Date;
(v) an additional $100,000 on or before the third anniversary of the
Approval Date;
(vi) an additional $200,000 on or before the fourth anniversary of the
Approval Date;
and,
(vii) an additional $500,000 on or before the fifth anniversary of the
Approval Date;
(b) issue and deliver to the Vendor:
(i) 200,000 Shares within ten days following the Approval Date;
(ii) an additional 300,000 Shares on or before the first anniversary of
the Approval Date;
(iii) an additional 500,000 Shares on or before the second anniversary
of the Approval Date;
(iv) an additional 500,000 Shares on or before the third anniversary of
the Approval Date;
(v) an additional 1,000,000 Shares on or before the fourth anniversary
of the Approval Date;
(vi) an additional 1,500,000 Shares on or before the fifth anniversary
of the Approval Date;
(c) incur expenditures on or with respect to the Property, of at least:
(i) $100,000 on or before the first anniversary of the Approval Date;
(ii) an additional $150,000 on or before the second anniversary of the
Approval Date;
(iii) an additional $250,000 on or before the third anniversary of the
Approval Date;
(iv) an additional $1,000,000 on or before the fourth anniversary of
the Approval Date; and
(v) an additional $1,500,000 on or before the fifth anniversary of the
Approval Date.
Omineca will also retain a 2% Net Smelter Return royalty. Sierra
Madre has the right to purchase one-half of the Royalty at any time
for $1,000,000 in cash.
The claims cover several intrusion related gold occurrences that
have been intermittently explored by various operators since the
early 1970's. Approximately $4 - $7 million was expended by Abo
Resources, Kerr Addison Mines Ltd., Bema International Resources
Ltd. and Northern Continental Resources over the years. Exploration
work since 1970 has included a total of 19,490m (64,000') of
diamond drilling in 161 drill holes and small-scale underground
development work. Most of the historic work was focused on the
northern part of the Property in the area of the Jenner and Portal
Stocks. Drill results reported from the Portal Zone include 30
meters averaging 3.17 grams per tonne gold (EMPR ASS RPT 19584).
Drill results reported from the Jenner Stock include 64m averaging
3.77 g/t (EMPR ASS RPT 20144). Other gold-bearing stocks identified
on the Property include the Hill and Lake Stocks. These areas have
seen limited exploration in comparison to the Jenner-Portal Stocks
areas. Diamond drill intersections reported from the Hill Stock
area include DDH BX88-130 which averaged 3.54 g/t Au and 6.3 g/t Ag
over 27 meters, and contained 8m averaging 8.7 g/t Au and 14.2 g/t
Ag (EMPR ASS RPT 20144). The Property is road-accessible
year-round. Hydroelectric power, natural gas and rail-service are
located within three kilometers of Property boundaries.
In 2002, Barry Price, P.Geo., was retained to review an historic
resource estimate calculated by G. Norman on behalf of Bema
Resources for the Property based on historical results. Price
estimated a "probable resource" for the Jenner and Portal Stocks of
1,845,000 tonnes averaging 2.79 g/t or 165,200 oz. in situ, with a
further Possible Resource of 613,600 tonnes averaging 2.79 g/t or
55,100 oz. The reliability of the historical data is unknown but is
considered relevant by Company management. The historical data is
non-NI 43-101 compliant and should not be relied upon. The
historical resource estimate uses a category of "probable resource"
which is no longer used under NI 43-101. Neither Omineca nor Sierra
Madre has done sufficient work to validate the above resource
estimate. It is the Company's intention to verify the historical
data and confirmation work may produce results that differ
substantially from the historic results.
Sierra Madre CEO, Carl von Einsiedel, P.Geo. comments: "The
Harrison Project represents an excellent opportunity for Sierra
Madre to build shareholder value. The extensive exploration work
carried out on intrusion related gold occurrences in the Yukon in
last few years has helped develop new geological models and
innovative exploration methods for these types of deposits. Much of
the Harrison Property is relatively unexplored and the wealth of
historic technical data will make it possible for Sierra Madre to
utilize management expertise and quickly identify target areas that
can build on the success of previous programs."
About Sierra Madre Developments: Sierra Madre is a TSX Venture
listed junior mining company based in Vancouver, British Columbia,
Canada. Management has extensive exploration and mining expertise
and the Company's business model is to acquire advanced gold and
silver projects and build shareholder value by rapidly advancing
our projects through the resource delineation stage.
ON BEHALF OF SIERRA MADRE DEVELOPMENTS INC.
Carl von Einsiedel, CEO
Certain statements in this press release may be considered
forward-looking information. These statements can be identified by
the use of forward looking terminology (e.g., "expect",
"estimates", "intends", "anticipates", "believes", "plans"). Such
information involves known and unknown risks -- including the
availability of funds, the results of financing and exploration
activities, the interpretation of exploration results and other
geological data, or unanticipated costs and expenses and other
risks identified in the Company's public securities filings that
may cause actual events to differ materially from current
expectations. There is no assurance the Company will be able to
exercise its option to acquire the Harrison Lake Property. There is
no assurance any additional work on the Property will yield results
which verify past results, or otherwise indicate the Property to
have any economic resource. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date of this press release.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Contacts: Sierra Madre Developments Inc. Carl von Einsiedel CEO
604-685-3357
(TSXV:SMG)
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