Metallica Resources Signs Option Agreement for Antofagasta Minerals to Earn 70% Interest in Rio Figueroa Project
16 Juni 2008 - 2:30PM
Marketwired
TORONTO, ONTARIO (AMEX: MRB) is pleased to announce that its
wholly owned subsidiary Minera Metallica Resources Chile Ltda.
(Metallica) has entered into an agreement with Antofagasta Minerals
S.A. (Antofagasta), a Chilean company and wholly owned subsidiary
of Antofagasta PLC, whereby Antofagasta has the option to earn up
to a 70% interest in Metallica's Rio Figueroa copper-gold project.
The Rio Figueroa project is currently 100% owned by Metallica and
is located approximately 125 kilometers northeast of Metallica's
30% owned El Morro project.
The agreement provides Antofagasta with the right to earn an
initial 30% interest in the project by making a US$50,000 cash
payment to Metallica upon signing and a firm commitment for cash
purchase payments to Metallica totaling US$2.6 million by September
2, 2009. Metallica will in turn use the $2.6 million in cash
payments to complete its option to purchase a 100% interest in the
project from SCM Los Potrillos, an underlying property owner
controlled by the Chilean National Mining Company (ENAMI). Upon
completion of its option to earn a 30% interest, the project will
be operated under a joint venture shareholder's agreement between
the companies. Antofagasta also has the option to earn an
additional 20% interest in the project by completing US$7 million
in exploration expenditures by June 5, 2012, two-thirds of which
must be directed specifically toward exploration drilling
activities which are to commence by June 5, 2009. Should
Antofagasta elect not to exercise its option to earn a 50%
interest, the project will be operated by both companies as a 30:70
joint venture with Metallica retaining the majority interest.
Alternatively, upon completion of the second option, Antofagasta
will hold a 50% interest in the project and an option to earn an
additional 20% interest by completing a feasibility study for the
project and making a final cash payment of US$5 million to
Metallica by June 5, 2015. After earning a 70% interest, based on a
positive feasibility study and a decision to develop the project to
commercial production, Metallica may request Antofagasta to use its
best efforts to arrange financing for the development program on a
common projects financing basis, utilizing the project's assets and
future cash flows as security for financing. Should Antofagasta
elect not to exercise its option to earn a 70% interest, the
project will continue to be operated by both companies as a 50:50
joint venture.
The Rio Figueroa project is situated along a southern extension
of the Domeyko fault system within the Eocene-Oligocene porphyry
belt, host to some of the world's largest copper deposits. Since
acquiring the property in 2004, Metallica has invested
approximately US$1 million in combined cash purchase option
payments and land holding fees and an estimated US$3.15 million in
direct exploration expenditures. The latter includes the completion
of 56 drill holes totaling 14,344 meters, nearly two-thirds of
which has been focused on the Cerro Matta target where drilling by
Metallica has intercepted significant copper-gold mineralization
over a zone measuring 400 meters wide by 500 meters long and at
least 600 meters deep.
Among the significant drill intercepts received from Cerro Matta
to date are 294 meters averaging 0.42% copper and 0.55 g/t gold
from 314 to 608 meters in hole MDH-2, 422 meters averaging 0.24%
copper and 0.28 g/t gold from 22 to 444 meters in hole MDH-8, and
158 meters averaging 0.37% copper and 0.56 g/t gold from 288 to 446
meters in hole MRC-15. Supporting ground magnetics and
IP-Resitivity surveys over Cerro Matta and the surrounding area
further suggest the Cerro Matta target represents the upper part of
a larger porphyry copper-gold system that remains open to further
exploration in at least three directions and at depth.
"We are very pleased Antofagasta Minerals has joined us to
advance the Rio Figueroa project", stated Metallica's President and
CEO Richard Hall. "Antofagasta's position as one of the world's
largest copper producers with major mining operations in Chile and
an international focus that includes exploration programs in
several other countries offers unparalleled experience and depth
for the advancement of the Rio Figueroa project".
Actlabs Chile S.A. of Coquimbo, Chile has completed all of
Metallica's analytical work for the Rio Figueroa project to date.
The analytical methods used for drill hole samples is geochemical
analysis for copper and fire assay with atomic absorption finish
for gold. A map showing drill hole locations and a table of drill
hole location coordinates will be provided with a Material Change
Report to be filed on SEDAR within 10 days of this press release.
The Qualified Person, as defined by Canadian NI 43-101, responsible
for the design and conduct of all exploration work performed by
Metallica to date and the presentation of the information contained
in this press release is Mr. Mark A. Petersen, Certified
Professional Geologist - AIPG and Vice President of Exploration for
Metallica Resources Inc.
Metallica Resources is a Canadian gold and silver producer. It
currently has 96.5 million shares outstanding and no debt. For
further details on Metallica Resources, please visit the company's
website at www.metal-res.com.
INFORMATION IN THIS NEWS RELEASE THAT IS NOT CURRENT OR
HISTORICAL FACTUAL INFORMATION MAY CONSTITUTE FORWARD-LOOKING
INFORMATION OR STATEMENTS WITHIN THE MEANING OF THE UNITED STATES
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND APPLICABLE
CANADIAN SECURITIES LEGISLATION. IMPLICIT IN THIS INFORMATION,
PARTICULARLY IN RESPECT OF STATEMENTS AS TO FUTURE OPERATING
RESULTS AND ECONOMIC PERFORMANCE OF THE COMPANY, AND RESOURCES AND
RESERVES AT THE COMPANY'S MINERAL PROJECTS, ARE ASSUMPTIONS
REGARDING PROJECTED REVENUE AND EXPENSE, GOLD, SILVER AND COPPER
PRICES, AND MINING COSTS. THESE ASSUMPTIONS, ALTHOUGH CONSIDERED
REASONABLE BY THE COMPANY AT THE TIME OF PREPARATION, MAY PROVE TO
BE INCORRECT. READERS ARE CAUTIONED THAT ACTUAL RESULTS ARE SUBJECT
TO A NUMBER OF RISKS AND UNCERTAINTIES, INCLUDING RISKS RELATING TO
GENERAL ECONOMIC CONDITIONS AND MINING OPERATIONS, AND COULD DIFFER
MATERIALLY FROM WHAT IS CURRENTLY EXPECTED. THE COMPANY DISCLAIMS
ANY INTENTION OR OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING
STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS
OR OTHERWISE.
Contacts: Metallica Resources Inc. Rhonda Bennetto Director
Investor Relations (303) 640-3292 Website: www.metal-res.com
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