Uragold Signs Letter of Intent Granting it an Exclusive Option to Earn a 50% Undivided Interest in Golden Hope Mines Bellecha...
February 24 2014 - 9:42AM
Marketwired
Uragold Signs Letter of Intent Granting it an Exclusive Option to
Earn a 50% Undivided Interest in Golden Hope Mines
Bellechase-Timmins Gold Deposit
MONTREAL, QUEBEC--(Marketwired - Feb 24, 2014) - Uragold Bay
Resources Inc. ("Uragold") (TSX-VENTURE:UBR), is pleased to
announce that it has signed a Letter of Intent ("LOI") with Golden
Hope Mines ("GNH") (TSX-VENTURE:GNH) granting Uragold the sole and
exclusive option to earn a 50% (fifty percent) undivided interest
in the Bellechasse-Timmins ("B-T") Gold Deposit. Uragold can earn
its interest by advancing the B-T Gold Deposit project up to a
small-scale (2,000 MT/day) surface mine. GNH's B-T property is
located in the Beauce region of southeastern Quebec, 50 km north
east of Uragold's Beauce Placer Gold project.
In August 2012, GNH published an uncapped resource estimate of
an indicated resource of 313,900 ounces gold (2.9 million tonnes
grading 3.36 g/t Au) and an inferred resource of 102,000 ounces
gold (2.17 million tonnes grading 1.46 g/t Au) using a cut-off
grade of 0.60 g/t.
Furthermore, GNH's many bulk-sampling campaigns revealed
extensive areas of surface mineralization averaging approximately 3
g/t Au. Notable were sampled areas averaging up to 10 g/t Au
(Trench 09A).
Uragold strongly believes that, similar to its Beauce Placer
project, it is possible to develop a small-scale (2,000 MT/day)
surface gold mining operation on the B-T property. Developing in
parallel the B-T property and the Beauce Placer property will
benefit both companies by providing greater geological and
operational synergies such as cost savings.
The B-T property and the Beauce Placer property have many points
in commons, key among them is the fact that the deposits are
located in the Magog Group geological formation and they are both
"nuggety" type deposits.
Under the terms of the LOI, Uragold will be responsible for
obtaining all required permits, approvals, and documentation
associated with going into production, in return for a 30% interest
in the property. Uragold will then have 120 days to obtain project
financing, which, if successful, will earn it a further 20%
interest, giving Uragold a 50% interest in the B-T deposit. The
companies will then form a Joint Venture (JV) for the operation of
the mine, with Uragold serving as operator. GNH will have a carried
interest into production, and will receive a 50% Net Proceeds
Royalty ("NPR") on the gold produced. (A feasibility study has
not been completed and there is no certainty the proposed operation
will be economically viable.)
The salient points of the LOI are:
Uragold can earn up to a 30% undivided interest in the B-T
Deposit by performing, completing and delivering the following work
and documentation within 18 months of the signing:
- $100,000 paid to GNH within 6 months of the date of the signing
of the LOI in three equal tranches. The first tranche of $33,000
was paid upon the signing of the LOI;
- A review of the previously published NI 43-101 Resource
Estimate for gold at Bellechasse-Timmins in Southeastern Quebec by
a qualified person(s) or firm of qualified persons as defined by NI
43-101 Standards for Disclosure for Mineral Project;
- Uragold will mandate a Qualified Mining Engineering Firm for a
Preliminary Economic Assessment ("PEA") with respect to the
production of the gold deposit including CAPEX, OPEX, IRR, NPV,
Mining Plan, Geotechnical Assessment of pit, overburden stockpiles
and tailings, etc.;
- An Environmental Audit in accordance with Directive 19, Article
22 of the "Loi sure la qualité de l'environnement" by an
independent qualified consultant, which shall include a study of
the property and the environmental impact of mining
activities;
- A Certificate of Authorization ("CA") from the municipality of
Saint Magloire.
- A Certificate of Authorization ("CA") from the "Ministère de
l'environnement" for the permitting of a small scale gold
production of 2,000 metric tons of material per day.
- A Land Survey by a qualified Surveyor ("Arpenteurs
Géomètres"), which will be filed for approval with the
"Bureau de l'Arpenteur Général du Québec."
- A Mining Lease from the "Ministère de Resources Naturelles
et de la Faune du Québec ("MRNF")" for the operation of a gold
mine; and,
- A Reclamation and Restoration Plan approved by MRNF
Uragold shall bear all the costs associated with the work listed
above.
Uragold may also earn an additional 20% undivided interest (for
a total of 50%) if it provides all of the required financing to
fund the start of production of the B-T Gold Deposit as set out in
and according to the Preliminary Economic Assessment Plan not later
than 120 days after the successful completion and issuance of the
initial 30% interest.
This transaction will be binding upon:
- The approval of the Board of Directors of both GNH and UBR;
(Obtained)
- The reception of the first tranche of $33,000; (Done)
- All required regulatory approvals. (Pending)
- The signing of a definitive agreement within 45 days.
(Pending)
Patrick Levasseur Uragold President and COO remarks: "We are
extremely pleased that our offer was chosen by GNH and that we will
become a partner in the development of the Bellechasse-Timmins gold
deposit. We look forward to working with GNH who has done a
fantastic job and are pioneers in the exploration and the discovery
gold in the Beauce region of Quebec."
Frank Candido, CEO and President of GNH, remarked, "We are very
pleased with this Letter of Intent entered into by two companies
with an equally vested interest in gold exploration in Southeastern
Quebec. GNH has been entertaining potential offers to move towards
production since the publication of its first resource estimate in
mid 2012. We believe that the nature of the gold deposit, the
location of the property, the support from the municipality of
Saint-Magloire, Quebec and the local infrastructure all make for an
excellent opportunity to bring profitable gold production back to
Southeastern Quebec. Our excellent relationship with the UBR
Management has always been cordial and we have always looked to
work together to advance our common interests. This Letter of
Intent and Joint Venture Agreement is simply an extension of that
co-operation."
Mr. Vivian Stuart-Williams, SACNASPS, working under Special
Authorization #290 of the Quebec Order of Geologist, is a Qualified
Person as defined by National Instrument 43-101 that supervised the
preparation of the information in this news release.
Other Corporate development:
The Company announces that Mr. Vivian Stuart-Williams is
resigning from the Board of Directors effective February 24, 2014.
By resigning and immediately relinquishing his options and all
financial interest in the Company, Mr. Stuart-Williams will now
only be acting as an independent Qualified Person for the
Corporation, as defined by NI 43-101 Standards for Disclosure for
Mineral Project. While we will miss Mr. Stuart-Williams insight and
advice on the Board, we are excited to have Mr. Stuart-Williams
becoming an independent consultant for the Corporation.
Uragold would like to remind investors that it will be an
exhibitor at the 2014 PDAC (Prospectors & Developers
Association of Canada) convention and trade show held in Toronto,
Ontario from March 2 to 5. Uragold welcomes everyone to come and
meet the management.
About Uragold Bay Resources Inc.
Uragold Bay Resources is a junior exploration company trading on
the TSX Venture under the symbol UBR. Uragold holds gold properties
in Southern Quebec's Appalachian belt. Uragold's business model is
focused on the development of small-scale gold exploration projects
into mines in order to generate free cash flow to internally
finance growth and blues sky exploration.
Uragold aims to become one of the rare cash flow generating
mining S.M.E.'s in the next 12 - 18 months by developing Quebec's
first placer mine in 50 years, the Beauce Placer Project and by
developing, in partnership with Golden Hope Mines, the
Bellechasse-Timmins Gold Deposit.
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.
Shares outstanding: 54,039,743
Uragold Bay Resources Inc.Bernard J. TourillonChairman and
CEO(514) 846-3271Uragold Bay Resources Inc.Patrick
LevasseurPresident and COO(514) 846-3271www.uragold.com
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