VANCOUVER, Feb. 9, 2012 /CNW/ - Westminster Resources Ltd. (TSX-V: WMR) and Capstone Mining Corp. (TSX: CS) have entered into a Letter of Intent concerning WMR's prospective Porphyry-IOCG targets at the Cumbral-San Bartolo property, Sonora , Mexico. Capstone is a base metal producer with two operating mines, the Minto Mine in Canada and the Cozamin Mine in Mexico and two development projects, a large Iron Oxide-Copper-Gold ("IOCG") deposit called Santo Domingo in Chile and a VMS deposit called Kutcho in British Columbia.
The LOI covers an exploration funding arrangement for an "earn in" Joint
a) in stages Capstone has the exclusive right and option to earn 70% interest in Cumbral-San Bartolo by expending $9.3 million on exploration, and b) Capstone subscribing for 5,000,000 common shares of Westminster at a price of $0.15 per share for a total of $750,000 to be used by WMR for working capital. The earn-in stages are as follows:
Capstone has the exclusive right and option to earn a 49% interest by
paying to WMR $3.3 million:
1) on or before December 31, 2012 $1,600,000
2) on or before December 31, 2013 $1,700,000
|STAGE TWO||Capstone has the exclusive right and option to earn a further 11% interest by expending $3,000,000 on or before December 31, 2014 bringing their interest up to 60%.|
Capstone has the exclusive right and option to earn a further 10%
interest bringing their total interest to 70% by:
1) completing additional expenditures on or before December 31, 2015 $3,000,000
2) delivering a scoping study by June 30, 2016
|STAGE FOUR||Following completion of STAGE THREE, Capstone (70%) and Westminster (30%) each party will be responsible for their portion of funding going forward on a proportionate basis. Should WMR elect not to participate beyond STAGE THREE, Capstone will have the exclusive right and option to earn an additional 5% (for a total of 75%) undivided interest in the property by delivering a preliminary economic analysis on the property.|
|STAGE FIVE||Should WMR elect not to participative in funding at Stage Four and Capstone earns an additional 5% then each party will be responsible for their portion of funding going forward on a proportionate basis of the earn-in at Capstone (75%) and Westminster (25%). Thereafter each party will be responsible for contributing funding for the continued exploration and development of the Property on a proportionate basis to their ownership percentage. If either party elects not to participate fully in such funding, its ownership percentage will be diluted accordingly.|
|If Capstone does not elect to become the operator of the project prior to Stage 2 of the earn-in, it shall make payments to WMR in lieu of the applicable required expenditures (for the same amount) in Stage 2 and Stage 3 in order to satisfy the applicable thresholds, which amounts shall be used by WMR solely for exploration expenditures on the project.|
The parties anticipate the closing of The Definitive Agreement resulting from the LOI before April 30, 2012.
In 2010, Westminster Resources acquired the San Bartolo area target and in May 2011 discovered the Cumbral trend during regional mapping and follow-up of Aster anomalies in an area that is underlain by a large intrusive complex. By July 2011, Westminster completed a VTEM-MAG airborne geophysical survey at 200m line spacing over the JV property. The airborne magnetic survey features magnetic highs and lows in "magnetically active" patterns similar to other IOCG districts worldwide. Within the trends of the magnetic anomalies, copper oxide mineralization is found in association with areas of intense brecciation, potassium alteration and silicification, and in association with iron oxides (Magnetite-Hematite) as veins and breccia-cement in outcroppings over a 4 km by 2 km area. A suite of pink granite intrusions is present along the margins of the batholith and are associated with a magnetic low feature that is more than 7 kilometers long. Silver and gold grades accompany the copper and iron oxide mineralization. Recent ground magnetic and IP-resistivity geophysical surveying has been completed over 73 line kilometers on a portion of the Cumbral trend. WMR has already identified in the ground geophysical data, several high priority Magnetic and Induced Polarization anomalies that are coincident with newly discovered copper occurrences. While waiting for the final geophysical analysis, work will commence on a soil geochemistry survey targeting these anomalies in order to better define drill targets.
Glen Indra, President of WMR commented: "We look forward to an early exploration start which includes diamond drilling at the Cumbral-San Bartolo Project and we are very pleased to have Capstone as our partner; they are a successful mine operator and have an experienced aggressive exploration team that will add a significant depth of knowledge to the projects advancement."
All technical content in the foregoing disclosure has been verified and approved by Glen C. Macdonald, P.Geo., (a qualified person for the purpose of National Instrument 43-101, Standards of Disclosure for Mineral Projects). Mr. Macdonald is a director of Westminster Resources Ltd., and has visited the project.
ON BEHALF OF THE BOARD OF DIRECTORS
WESTMINSTER RESOURCES LTD.
"Glen J. Indra"
Managed by an experienced exploration team the Company is focused on exploring and developing its 28,644 hectare El Cobre and 19,362 hectare Navojoa properties in Sonora, Mexico. Gold-silver-copper discoveries and prospects include Cumbral-San Bartolo, Guayacan, Anita Mine, Saddle and several Skarn-Porphyry Systems.
This news release may contain forward-looking information which is not comprised of historical facts. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release may include, but is not limited to, the Company's objectives, goals or future plans. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, those risks set out in the Company's public documents filed on SEDAR. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law. The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
For further information regarding Westminster Resources Ltd., please contact Leif Smither or Fulvio Scrigner at 604-608-0400, Toll Free: 1-877-608-0007 or visit our website at www.westminsterres.com
Kin Communications Inc. At 604-684-6730, Toll free: 1-877-684-6730 Website: www.kincommunications.com