TORONTO, ONTARIO -- (MARKET WIRE) -- 10/18/10 --
Castillian Resources Corporation ("Castillian" or the "Company") (TSX VENTURE: CT) is pleased to announce that it has entered into a letter agreement (the "Letter Agreement") with Alder Resources Ltd. ("Alder") to acquire the right to acquire 60% interest in the Canadian Creek Gold property located in the Whitehorse Mining District (the "Property"). The Propery consists of 309 claims covering approximately 6,180 hectares located 160 kilometres south of Dawson in the highly prospective Tintina Gold Belt in central Yukon and approximately 50 kilometres southeast of the White (Underworld/Kinross) gold discovery and 25 kilometres southeast of the Coffee (Kaminak) gold discovery. The very large tonnage low grade Casino copper-gold-molybdenum porphyry deposit owned by Western Copper is located immediately east of the property (see attached figure). Alder acquired its interest in the Property pursuant to an option agreement (the "Option Agreement") dated June 11, 2009 entered into between Alder and Cariboo Rose Resources Ltd. (the "Optionor") under which Alder had an otion to acquire a 60% interest.
Bill Pearson, President & CEO of Castillian, commented: "This is an excellent acquisition for Castillian in what we consider to be a prime property in a major emerging gold belt in Yukon. Only recently has exploration focused on finding the newly discovered White-Coffee-style gold mineralization. Diamond drilling by previous operators has confirmed significant gold mineralization and geochemical sampling by Alder has outlined an extensive gold soil geochemical anomaly that extends for approximately 4 kilometres in the northeast part of the property. In addition analysis by Castillian geologists has identified other target zones on the Property that warrant follow up. Over the winter we plan to compile all available data in order to lay out a focused exploration program to evaluate priority target areas in 2011."
In consideration for the acquisition of the right to earn a 60% interest in the Property, Castillian agrees to pay Alder an aggregate cash fee of $250,000 and to issue to Alder that number of common shares of Castillian (the "Common Shares"), which in the aggregate shall equal $1,000,000 over a three (3) year period as follows:
In addition, the parties shall enter into an assignment agreement with the Optionor in accordance with the terms of the Option Agreement (the "Assignment Agreement"). The Assignment Agreement shall provide that in addition to the obligations to be assumed by Castillian as described above, Castillian shall: (i) on the third anniversary of the Option Agreement, being June 18, 2012, at its sole option make a cash payment of $60,000 and issue to the Optionor 50,000 shares or that number of Common Shares which are equal in value to $15,000; and (ii) on the fourth anniversary of the Option Agreement, being June 18, 2103, at its sole option, shall pay the Optionor $100,000 and issue 100,000 shares to the Optionor or that number of Common Shares which are equal in value to $30,000. Castillian will be required to carry out exploration on the property totalling $1, 4250,000 by June 18, 2013.
Completion of the acquisition is subject to the satisfactory completion of a 30 day due diligence period, and receipt of all required regulatory and securities approvals, including the approval of the TSX Venture Exchange, along with other customary closing conditions.
About Castillian Resources
Castillian Resources Corp. is a Canadian mineral exploration company listed on the TSX Venture Exchange under the symbol "CT" which has base metal and gold properties in Canada, South America and Tanzania. Castillian's flag ship property is the Hope Brook Gold Project located in southwestern Newfoundland where it has recently begun a 5,000 metre diamond drill program.
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Cautionary Note Regarding Forward-looking Information
This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the future financial or operating performance of the Company, its subsidiaries and its projects, statements regarding exploration prospects, statements regarding the potential and financial impact of the proposed Acquisition, the terms and conditions of the Acquisition, receipt of requisite approvals and the execution of definitive agreements, the benefits of the proposed Acquisition, the identification of mineral reserves and resources, costs of and capital for exploration projects, exploration expenditures, timing of future exploration, requirements for additional capital, government regulation of mining operations, environmental risks, reclamation expenses, title disputes or claims, limitations of insurance coverage and the timing and possible outcome of pending litigation and regulatory matters. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".
Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, political and social uncertainties; acquisition risks, the actual results of current exploration activities; delay or failure to receive board or regulatory approvals; timing and availability of external financing on acceptable terms; the Property not being integrated successfully or such integration proving more difficult, time consuming or costly than expected, not realizing on the potential benefits of the proposed transaction; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of mineral prices; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and shortages and other risks of the mining industry; and, delays in obtaining governmental approvals or required financing or in the completion of activities. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
NEITHER 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.
Castillian Resources Corp.
President & CEO