WEST KELOWNA, BRITISH COLUMBIA--(Marketwired - Feb. 6, 2017) - COLORADO RESOURCES LTD. (TSX VENTURE:CXO) ("Colorado" or the "Company") announces it has entered into a purchase agreement, (the "Agreement") with Kaizen Discovery Inc. ("Kaizen") (TSX VENTURE:KZD) to acquire a 100% interest in the Castle gold-silver-copper property (the "Castle Property")
The Castle Property is located 25 km northwest of Imperial Metals Red Chris1 mine development and within a district which hosts several significant gold-copper mines1 and occurrences including Red Chris, North Rok3, GJ1, Quash1, Saddle1, and Spectrum1, (see Figure 1). The Castle property is also surrounded on three sides by Colorado's Kinaskan property.
Previous work at the Castle2 focused on the western side of the property and included the completion of 21 diamond drillholes (4,805 m) between 1988 and 2013.
The mineralization at Castle is associated with an east-west striking structural and intrusive corridor that is spatially related to a 150 m x 1500 m long copper and gold soil anomaly, a coincident magnetic anomaly and an IP chargeability high.
Gold - copper mineralization noted to date includes both broad porphyry style and higher grade vein styles, such as:
- DDH CA 13-01 with 274 m of 0.102% Cu and 0.283 g/t Au
- DDH CA 13 - 03 with 4 m of 2.14% Cu, 4.88 g/t Au, and 73.2 g/t Ag contained within a 174 m interval of 0.106% Cu and 0.466 g/t Au4
The historic data2 suggests that the gold-copper mineralization at the Castle is open, and potentially strengthening, to the east, over a distance of 4.4 km to the property boundary towards the GT Gold1, Saddle Zone discovery. This area has seen the lowest density of historical drill testing.
Adam Travis, Colorado President and CEO states, "We are pleased to have Kaizen as a shareholder and to have the opportunity to advance the already significant historical results at the Castle Property. We believe that our technical team, with their extensive experience in this belt, and in particular with the successful North Rok porphyry copper-gold project, is strongly positioned to rapidly advance the Castle Property during the 2017 field season."
Under the terms of the agreement, Colorado may acquire a 100% interest in the property, subject to a 2% percent NSR to the underlying original vendor (the "Original Vendor NSR") for the following consideration:
- 1,000, 000 units of Colorado ("Consideration Units") to be issued to Kaizen within 5 days of the TSX Venture Exchange ("Exchange") approval. Each Consideration Unit will consist of one common share and one common share purchase warrant (a "Warrant"). Each Warrant will entitle Kaizen to purchase a further common share at a purchase price of $0.60 per share for a period of 24 months.
The Company has the option to purchase the Original Vendor NSR for CDN$4,000,000. The Consideration Shares issued in connection with the agreement will be subject to a four month hold period. The Agreement remains subject to regulatory approval.
Dr. Jim Oliver, Ph.D, P. Geo., the Company's Chief Geoscientist, is the Qualified Person as defined by National Instrument 43-101 who reviewed the preparation of the technical data in this news release.
Colorado Resources Ltd. is currently engaged in the business of mineral exploration for the purpose of acquiring and advancing mineral properties located in British Columbia and Nevada and is also seeking opportunities in Southwest USA and Latin America.
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.
Colorado Resources Ltd.
VP Corporate Development
T: (250) 768-1511 or TF (855) 768-1511