Dec. 7, 2010 (Filing Services Canada) -- Santa Barbara Resources Limited (SBL - TSX Venture), is pleased to announce the signing of an option agreement with Sociedad Legal Minera Pomez VIII Del Campo de Piedra Pomez ("SML Pomez") to acquire a 100 % interest in the San Francisco gold exploration property ("Property") in Chile. The transaction remains subject to regulatory approval.
Santa Barbara's President Christoph Lassl stated: "Santa Barbara has completed another milestone in its objective to achieve geographic diversification. We are pleased to have initiated operations in Chile, one of the best mining jurisdictions and one of the top mineral producing countries of the world. In addition, with the San Francisco project we have picked up a significant land package in the Maricunga gold belt where many world class gold deposits of significant size have been discovered in recent years".
San Francisco Property
The 3,740 hectare San Francisco property is located within the renowned Maricunga gold belt in the Region III (Atacama) of Northern Chile. The belt includes the world class gold and gold-copper deposits of the Casale project (Barrick-Kinross), the Caspiche project (Exeter), the Volcan project (Andina Minerals), the Lobo-Marte project (Kinross) as well as the large producing gold mines Maricunga (Kinross) and La Coipa (Kinross). In total the Maricunga gold belt reportedly hosts in excess of 70 million ounces of gold and 8,800 million pounds of copper, associated with porphyry intrusions and related epithermal systems.
The San Francisco property represents a large contiguous land package, exposing hydrothermal alteration 7 km long and up to 2 km wide, considered to be associated with a regional tectonic lineament and the nearby Wheelright caldera.
Eleven grab and chip samples were taken on the property, ranging from below detection limit to 3.92 g/t gold. Seven of the samples returned anomalous gold, two of which assayed values of 3.92 g/t gold and 3.86 g/t gold from grab samples of dark gray to black, banded quartz veinlets and breccias. Such banded quartz veinlets are known to host the bulk of the mineralization encountered in the Maricunga gold belt.
Reportedly the Property was subject to early stage exploration in the 1980's, including some limited trenching. No evidence of advanced stage exploration activities, such as drilling, has been encountered within the Property limits. Results of any previous exploration of the Property are not available to Santa Barbara.
Samples were prepared and fire assayed with AAS finish on a 50 g assay charge. Additionally, all samples were analyzed by a 35 element aqua regia ICP-AES method plus trace mercury detection by cold vapour-AAS methods. All sample preparation and analytical procedures were conducted by ALS Chemex in Coquimbo, Chile.
The results of the San Francisco sampling program and the technical content of this news release have been reviewed by Stewart Wallis P.Geo., consultant to the Company, who is the Qualified Person for the Company.
Terms of the Option Agreement
The Company has been granted a five year option to purchase a 100 % interest in the San Francisco property for USD 5,000,000.
To maintain the option to purchase Santa Barbara must make annual payments of USD 117,000 in year 1, USD 50,000 in year 2, USD 100,000 in year 3, USD 200,000 in year 4 and USD 400,000 in year 5 for a total of USD 867,000. These maintenance fees are not credited against the USD 5,000,000 option price.
Santa Barbara must also complete minimum exploration expenditures on the San Francisco project of USD 3,000,000 over the five year period of which USD 200,000 must be completed within the first year.
If the Company exercises the option and pays the USD 5,000,000 option price before the five year anniversary date, the remaining option maintenance payments and required exploration expenditures will be waived.
SML Pomez will retain a 2 % net smelter return royalty on mineral production from the property which the Company can buy back in two USD 5,000,000 instalments, 1 % for up to 2 years after mine production commences and the remaining 1.0 % at any time.
Subject to TSX Venture Exchange approval, the Company will pay an arm's length finder a fee of USD 10,000 in two equal installments of USD 5,000 in the first year.
About the Company
Santa Barbara is a Canadian mineral exploration company focused on the discovery and development of gold and copper resources throughout South America. The Company is well funded with about C$ 4.6 million in its treasury.
Santa Barbara is currently drilling its 6,200 hectare Sancos project, in which subject to certain option requirements the Company has the right to acquire a 100 % interest from Barrick Gold Corporation's Peruvian subsidiary. The Sancos project hosts multiple zones of gold mineralization within a large high sulphidation epithermal gold system.
Further project acquisitions are planned in Chile, either through claim staking or acquisition of other exploration or mining properties.
Additional information can be found on the Company's website www.sbr-ltd.com.
ON BEHALF OF THE BOARD
Christoph Lassl, President and
Chief Executive Officer
Please visit the Company's web site: www.sbr-ltd.com. For further information, please contact Christoph Lassl, President and Chief Executive Officer. Telephone: 593-2-2904164, Fax: 593-2-2556204 or email: firstname.lastname@example.org
Address: Edificio In-Luxor - Oficina 102, Camilo Destruge N24-633 y Francisco Salazar, P.O. Box 17-07-9719, Quito, Ecuador
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.
This news release contains certain statements that may be deemed "forward-looking" statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although Santa Barbara believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Forward looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. Except as required by law, the Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
SANTA BARBARA RESOURCES LIMITED.
Unit 1, 15782 Marine Drive
White Rock, British Columbia V4B 1E6
Web page: www.sbr-ltd.com
Source: Santa Barbara Resources Limited (TSX V SBL)
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