WEST KELOWNA, BRITISH COLUMBIA–(Marketwired – Sept. 14, 2015) – COLORADO RESOURCES LTD. (TSX VENTURE:CXO) (“Colorado” or the “Company”) announces that it has entered into an option agreement (“the Agreement”) with Centerra Gold Inc. (“Centerra”) whereby Centerra can earn a 70 % interest in the Heart Peaks (HP) Gold Project through making exploration expenditures totalling CAD$8.0 million by December 31, 2019.
Adam Travis, President and C.E.O of Colorado states, “We are very pleased to welcome Centerra to B.C and to have the opportunity to partner with a strong mid- tier gold producer who not only shares our enthusiasm for the exploration opportunities at HP but also our commitment to responsible mineral exploration and respectful, mutually beneficial discussions and opportunities for local communities and First Nations.”
Under the terms of the Agreement Centerra can earn a 70% interest by funding a total of CAD$8.0 million in exploration expenditures on the HP Project before December 31, 2019. Colorado will be the project manager on the HP Project for a minimum of two years and will receive a management fee. Once Centerra earns its 70% interest, a joint venture will be formed for the HP Project between Colorado and Centerra, and parties will be responsible for further contributions towards exploration expenditures on a pro rata basis, or be diluted accordingly. Should either party dilute to a 10% interest or less, their joint venture interest will be converted to a 2% Net Smelter Royalty of which one half can be purchased by the non-diluting party for CAD$2.0 million.
The HP Project
The HP Project is located approximately 45 kilometres northeast of the previously producing Golden Bear Mine in northwestern British Columbia. The HP Project covers one of B.C’s largest felsic volcanic centers and shares many geological similarities with young volcanic centres in Nevada and globally which host multi-million ounce low sulphidation epithermal gold deposits.
At HP felsic volcanic rocks have been highly altered over a large 20 km square area within which at least 7 surface gold showings (see Figure 1) have been found to date. Gold mineralization is focused along two lithologically and structurally defined corridors: the east-west trending 2 km long Top Zone to Midas Zone corridor and the north trending 3 km long corridor bounded by the Mogul East and Mogul West fault systems.
Gold values in surface grab samples as high as 126 g/t gold indicate there is very good potential to find high grade mineralization at shallow to moderate depths at Heart Peaks. In addition, historical drill testing, which returned intersections of up to 0.51 g/t gold over 115 metres in drillhole 84-4 (Daley, 1985), also demonstrates that the Heart Peaks hydrothermal system is robust enough to generate broad zones of lithologically controlled bulk tonnage style gold mineralization.
Previous work by Colorado in 2011 and 2012 included detailed geological mapping, soil and rock sampling, alteration and Terraspec mapping along with 12 km of I.P geophysics. This work suggests that some of the best targets have not yet been drill tested.
Exploration fieldwork on the HP Project is scheduled to commence shortly and is expected to include expansions of the soil geochemical and I.P geophysical surveys to cover open ended targets along with detailed geological and alteration mapping in preparation for finalizing proposed drill sites.
The rock and soil samples reported by Colorado in 2012 were analyzed by Agate Laboratories Ltd of Mississauga, Ontario. Samples were analyzed for 46 elements using an Aqua Regia Digest with an ICP‐OES finish (AGAT Analysis Code 201073) and for gold by fire assay fusion with an AAS finish (AGAT Analysis code 202051).
For more information on the Heart Peaks (HP) Project the reader is directed to the company’s website at www.coloradoresources.com.
To view Figure 1, please visit the following link: http://media3.marketwire.com/docs/HP_Project_Map.pdf
Greg Dawson, P.Geo is the Qualified Person as defined by National Instrument 43-101 who supervised the preparation of the technical data discussed in this news release.
ON BEHALF OF THE BOARD OF DIRECTORS OF
COLORADO RESOURCES LTD.
Adam Travis, President and Chief Executive Officer
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this news release, constitute “forward-looking information” as such term is used in applicable Canadian securities laws. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions, including: that the Company’s financial condition and development plans do not change as a result of unforeseen events, that the Company obtains required regulatory approvals, that the Company continues to maintain a good relationship with the local project communities.. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, which could result in delays, or cessation in planned work, that the Company’s financial condition and development plans change, delays in regulatory approval, risks associated with the interpretation of data, the geology, grade and continuity of mineral deposits, the possibility that results will not be consistent with the Company’s expectations, as well as the other risks and uncertainties applicable to mineral exploration and development activities and to the Company as set forth in the Company’s Management’s Discussion and Analysis reports filed under the Company’s profile at www.sedar.com. There can be no assurance that any forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader should not place any undue reliance on forward-looking information or statements. The Company undertakes no obligation to update forward-looking information or statements, other than as required by applicable law.
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.
President and Chief Executive Officer
(250) 768-1511 or TF (855) 768-1511
(250) 768-0849 (FAX)
Colorado Resources Ltd.
Chief Financial Officer
(250) 768-1511 or TF (855) 768-1511
(250) 768-0849 (FAX)