VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 13, 2012) -
Editors note: There is one video associated with this press release.
Eagle Star Minerals Corp., (TSX VENTURE:EGE)(PINKSHEETS:ELGSF)(FRANKFURT:E6R) ("Eagle Star" or "the Company") is pleased to announce the acquisition of a 100% interest in the Samba phosphate project which consists of 60 mineral claims covering 109,285 hectares (270,049 acres) situated within the central western portion of Piauí state where favorable tax incentives are offered towards mining investment. The project is strategically located near the cities of Valença and São José do Peixe, and is in close proximity to the Company's Ruth agro-mineral project.
Preliminary exploration work performed on the Ruth project and information provided by an arms length party, led Eagle Star's team to investigate other areas with a similar geological setting, which ultimately led to the discovery and acquisition of the Samba.
In addition to its favorable geology and location, the Samba agro-mineral project benefits from its proximity to potential future end markets - the Balsas and Bom Jesus Agricultural Centers, which cross two states (69,218km2) and are home to a large soy growing industry with production of over 2.3 million tonnes of beans annually. The project is also 100km away from the Transnordestina railroad, which is scheduled to be completed by 2013 at a construction cost of US$3.21 billion. The completed railroad will connect the region to three major ports in North Eastern Brazil (Sao Luis, Pecem and Suape) providing an alternative transportation route to additional end markets.
REGIONAL EXPLORATION PROGRAM RESULTS
Regional reconnaissance work investigated an area of 200km by 170 km in the region of Piauí state covered by the Longá Formation (Parnaiba Basin). Three sub areas of the Parnaiba Basin were identified with rock types carrying phosphate mineralization.
Regional geological mapping showed that the Longá Formation consists of interbedded siltstones over 100 meters thick. The phosphate mineralization is restricted to several siltstone beds up to 3.5 meters thick. Field observations suggest a geomorphologic control over the mineralization, which mixes topography with erosional level.
Due to the large target area of the regional exploration program, Eagle Star performed regional and follow up sampling on existing road cuts, generating 201 channel samples (0.5-1m channel samples).
Lab results obtained to date demonstrate an excellent exploration case for Samba (with 12% of regional samples returning values of over the 2.5% P2O5 cutoff grade). The significant results are shown in the following table.
|Samba||Total of samples||Number of samples with 2.5% c.o.g||%|
|Channel and Chip samples||210||24||11.4|
|ELEVATION (GPS)||SAMPLE #||P2O5 (%)||Analysis type|
|EGS regional||-||49855||11.87||Lab results|
|EGS regional||233.965||49871||17.60||Lab results|
|EGS regional||249.586||49881||5.16||Lab results|
|EGS regional||249.586||50574||11.82||Lab results|
|EGS regional||249.586||50576||5.08||Lab results|
|EGS regional||230.841||50577||12.35||Lab results|
|EGS regional||170.759||50585||6.67||Lab results|
|EGS regional||170.759||50586||7.31||Lab results|
|EGS regional||176.286||50587||6.63||Lab results|
|EGS regional||162.587||61747||10.26||Lab results|
|EGS (Samba)||282||51153 *||3.04||XRF|
|EGS (Samba)||282||51154 *||3.69||XRF|
|EGS (Samba)||326||51015||3.28||Lab results|
|EGS (Samba)||291||51028||9.42||Lab results|
|EGS (Samba)||299||50987 *||5.48||XRF|
|EGS (Samba)||254||51054 *||4.19||XRF|
|EGS (Samba)||254||51055 *||2.87||XRF|
|EGS (Samba)||190||51063 *||6.40||XRF|
|EGS (Samba)||174||51065 *||3.58||XRF|
|EGS (Samba)||174||51066 *||5.28||XRF|
|EGS (Samba)||180||51067 *||6.90||XRF|
|EGS (Samba)||180||51068 *||2.67||XRF|
|EGS (Samba)||222||51070 *||48.51||XRF|
|EGS (Samba)||229||51072 *||5.19||XRF|
|* Pending confirmation from lab|
To view the map associated with this press release, please visit the following link: http://media3.marketwire.com/docs/765523_map.pdf
The modes of occurrence of the phosphate mineralization at Samba are very similar to many other well known sedimentary phosphate mines and deposits. The mineralized siltstone occurs as stratified layers and therefore suggests lateral continuity for the mineralized intervals.
The positive results are observed within topographic levels that vary from 162m to 326m supporting a provisional exploration model characterized by the presence of multiple mineralized intervals and layers. The figure and photographs shown below clearly explain the mineralization characteristics and suggest the extensive potential.
Figure and photographs: http://media3.marketwire.com/docs/765523_figure_and_photographs.pdf
PLANNED EXPLORATION PROGRAM
An aggressive follow up exploration program is planned in order to investigate the project's potential to host significant phosphate resources. The work to be performed will include detailed geological mapping, topographic survey, additional channel and trench sampling, and if results warrant, it will be followed up with a diamond drill program in the second quarter of 2012.
Over the past year Eagle Star Minerals has recognized certain opportunistic trends developing into what is now a major problem in Brazil; namely the lack of sufficient domestic supply of agro-minerals. As a result, the company has decided to strategically reposition itself and make agro-mineral projects its main focus. This change of direction should allow for substantial growth in the company's presence in Brazil and in turn create a compelling value proposition to its shareholders.
With the professional assistance of its senior advisors and highly experienced local geological team, Eagle Star has identified and staked areas with significant potential to host large phosphate deposits. These one hundred percent owned projects located in close proximity to agriculture and existing infrastructure, provide Eagle Star with a real opportunity to become a producer of a commodity that benefits from an immediate, strong local market at a very attractive cost structure, all within a relatively short period of time.
"We are extremely pleased with the acquisition of our Samba agro-mineral project," commented Eran Friedlander, President and CEO of Eagle Star Minerals. "The results from the regional recognition work and follow up field sampling are very positive and on that basis, we believe this will lead us to discover a significant phosphate deposit in Samba." "We now look forward to investigate the extent of lateral continuity of phosphate mineralization by way of a follow-up exploration program. Eagle Star is convinced that the strong technical, logistical and economical fundamentals of this opportunity coupled with the potential for near-term production at relative low capital cost will ultimately deliver significant returns to our shareholders."
The Company has agreed to pay project generation fees to an arms-length party. In order to maintain 100 percent interest in the project the following fees have to be paid to the party:
- Issuance of 1 million shares within one year from the start of the first exploration stage subject to regulatory approvals (binding). 25% will be free trading effective immediately, additional 25% will be free trading within 6 months of issuance, further 25% will be free trading within 12 months of issuance and the final 25% will be free trading within 18 months of issuance.
- Cash payments of USD 50,000 and 1 million Brazilian Reals within 12 months or upon completion of first exploration stage (whichever is longer) or 2 million Brazilian Reals within 24 months or upon completion of second exploration stage (whichever is longer) or 3 million Brazilian Reals within 36 months or upon completion of third exploration stage (whichever is longer). Alternatively, the company can choose to make no additional cash payments beyond the initial down payment of USD 50,000 in which case it will retain 70% interest in the project.
ANGICO IRON ORE PROJECT
In view of these new developments concerning phosphate projects acquisitions and reshaping of strategy, the Company has made the decision to cease exploration on the Angico Iron Ore Project despite its excellent potential to host significant iron ore mineralization.
Eagle Star's Management and Board of Directors believe that the macro economic fundamentals of the agro-mineral sector in Brazil, the strong technical merits of the Company's current agro-mineral projects and the knowhow and specific experience of its Brazilian team, lend strong support to this strategic decision.
Furthermore, now that Eagle Star has developed in house capabilities to identify and claim lucrative, wholly owned, mineral opportunities in Brazil, the company intends to keep project acquisition costs at bare minimum and use these significant savings towards expansion and development of its own asset portfolio.
QUALITY ASSURANCE, QUALITY CONTROL AND QUALIFIED PERSONS
SGS Geosol Laboratorios Ltda (SGS), located in Vespaciano, Minas Gerais State, Brazil, analyzed the rock samples. SGS is a ISO14001:2004 and ISO 9001:2008 accredited laboratory.
The samples were analyzed by fusion with lithium tetraborate-XRF for SiO2, Al2O3, Fe2O3, CaO, MgO, K2O, TiO2, P2O5 and MnO and retained moisture (LOI) by multi-temperature. SGS inserts its own standards, blanks and duplicate samples. The results from these control samples indicate acceptable consistency of analysis.
This news release was reviewed and approved by Mohan R. Vulimiri, M.Sc., P.Geo, who is a qualified person under the NI 43-101 guidelines. Mr. Vulimiri is a member of the Eagle Star's Technical Advisory Board where he advises on all technical aspects with respect to the Company's various projects.
ABOUT THE COMPANY
Eagle Star Minerals Corp. is a natural resource company headquartered in Vancouver, British Columbia Canada, focused on the acquisition, exploration and development of agro-mineral properties in Brazil. The Company's shares are publicly traded on the TSXv under the symbol EGE, on the OTC Pink Sheets under symbol ELGSF and on Frankfurt Stock Exchange under the symbol E6R.
On behalf of the board of directors
EAGLE STAR MINERALS CORP.
Eran Friedlander, President & CEO
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