Canstar Resources Acquires Two Base Metal Properties in Newfoundland; Mary March Update
9/9/2008 7:01:16 AM - Market Wire
TORONTO, ONTARIO, Sep 09, 2008 (MARKET WIRE via COMTEX News Network) --
The directors of Canstar Resources Inc. (TSX VENTURE: ROX) are pleased to announce that the Company has entered into agreements with arm's length parties to acquire 100 % interests in two mineral properties totaling 163 claims (4075 hectares), in the area of Conception Bay South on the Avalon Peninsula, Province of Newfoundland and Labrador.
The properties adjoin each other and cover a belt of volcanic-sedimentary rocks of Proterozoic age that are known to host Volcanogenic Massive Sulphide (VMS) mineralization containing economically significant values in copper, zinc, lead, silver and gold. The area has very sparse bedrock exposure and hence very little exploration has ever been carried out on the properties. Several sulphide showings have been found in recent years, primarily in road cut exposures. Grab samples from one such exposure assayed up to 8.9 % zinc, 5.2 % lead, 0.8 % copper, 0.3 grams/ton gold and 1.4 grams/ton silver.
The properties are crossed by the Trans Canada Highway, approximately 20 kilometers south west of the provincial capital, St John's. The property is easily accessible by a number of secondary roads.
A property visit by Company personnel confirmed both the favourable geology and base/precious metals mineralization.
In order to acquire a 100% interest in the two properties, the Company must make combined cash payments of $30,000 on signing; $35,000 on the first anniversary of the agreement and $45,000 on the second anniversary of the agreement, and combined share payments of 100,000 common shares of Canstar on Signing; 175,000 shares on the first anniversary of the agreement; and 275,000 shares on the second anniversary of signing. Both properties are subject to net smelter royalties of 2% and 2.5%, while the Company reserves the option to buy back 1% and 1.5%, respectively, for $2,750,000. The agreements are subject to regulatory approval.
A comprehensive exploration program will commence immediately, starting with an Airborne Electromagnetic/Magnetic survey, to be followed by ground geophysics, geology, prospecting, geochemistry and drilling of selected targets, all in 2008.
The Directors feel that, not only do these properties represent an excellent opportunity for the discovery of commercial mineral deposits but will also be complementary to the Company's Mary March project in the Buchans area with respect to operating logistics and provincial regulatory and reporting requirements.
Mary March
With regard to the Mary March property title dispute the Adjudication Board hearing will be held on September 15th. According to the Board's stated mandate a decision must be handed down within 90 days of the hearing. The directors expect that it will be sooner.
