Apogee Minerals Ltd.
TSX VENTURE : APE

Apogee Minerals Ltd.

October 05, 2009 09:06 ET

Apogee Diversifies Into Chile With Acquisition of the Cachinal Silver Property

TORONTO, ONTARIO--(Marketwire - Oct. 5, 2009) - Apogee Minerals Ltd. (TSX VENTURE:APE) has reached agreement with Valencia Ventures Ltd. whereby Apogee will have the option to purchase up to 100% of Valencia's interest in the Cachinal Silver property located in northern Chile. Under the terms of the agreement, Apogee will initially purchase 75% of Valencia's interest in the Cachinal property by paying Valencia $200,000 in cash and issuing to Valencia 3 million units of Apogee. Each unit will consist of one common share of the Company and one common share purchase warrant entitling the holder thereof to acquire one common share of the Company at an exercise price of $0.25 for a period of 12 months from the date of issue. Pursuant to the terms of the agreement, Apogee will have the option to purchase the remaining 25% interest by paying Valencia $1 million at any time prior to October 5, 2012 (the "Option Period"). During the Option Period Apogee will be responsible for all exploration costs with respect to the Cachinal property up to $2,000,000. A description of the Cachinal property is included below.

has reached agreement with Valencia Ventures Ltd. whereby Apogee will have the option to purchase up to 100% of Valencia's interest in the Cachinal Silver property located in northern Chile. Under the terms of the agreement, Apogee will initially purchase 75% of Valencia's interest in the Cachinal property by paying Valencia $200,000 in cash and issuing to Valencia 3 million units of Apogee. Each unit will consist of one common share of the Company and one common share purchase warrant entitling the holder thereof to acquire one common share of the Company at an exercise price of $0.25 for a period of 12 months from the date of issue. Pursuant to the terms of the agreement, Apogee will have the option to purchase the remaining 25% interest by paying Valencia $1 million at any time prior to October 5, 2012 (the "Option Period"). During the Option Period Apogee will be responsible for all exploration costs with respect to the Cachinal property up to $2,000,000. A description of the Cachinal property is included below.

The Cachinal property is located in Region II, Chile and is an advanced silver property, with a National Instrument 43-101 resource estimate dated March 4, 2008 prepared for Valencia on the Cachinal Property, comprising 18.41 million ounces of silver in the indicated resource category and an additional 3.02 million ounces of silver in the inferred resource category. (Please see the NI 43-101 independent technical report of Valencia dated April 30, 2008 entitled "Mineral Resource Estimation, Cachinal Silver-Zinc-Gold Project, Region II, Chile", filed on the SEDAR profile of Valencia at www.sedar.com.) The Cachinal deposit is a low-sulfidation epithermal system which has had past production of 32 million ounces of silver. The Company believes there is good potential to expand the estimated resource. The March 4, 2008 mineral resource estimate for the Cachinal property is summarized below:

Mineral Resource Statement – March 4, 2008*
SRK Consulting (Canada) Inc
Sections 1250NNW – 1000SSE

  Resource
Classification
  Quantity
 (Mt)
  Grades  Contained Metal
Silver
(g/t)
Gold
(g/t)
Zinc
(%)
Silver
(Moz)
Gold
(000 Oz)
Zinc
(Mlbs)
Indicated 
OpenPit15.50990.130.2117.4923.0025.97
Underground20.151880.210.520.921.021.75
Total5.661010.130.2218.4124.0327.72
Inferred 
OpenPit10.45610.070.130.881.011.26
Underground20.371800.190.342.142.252.77
Total0.821150.120.223.023.264.03

*Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. All figures are rounded to reflect the accuracy of the estimates. The cut-off grades are based on metal price assumptions of US$12.50 per oz silver, US$650 per oz gold and metallurgical recoveries of 85% for silver and gold. Zinc does not contribute to revenues.
1Reported at a cut-off of 40g/t AgEq to a vertical depth of 150m below surface assuming an open pit mining scenario
2Reported at a cut-off grade of 150g/t AgEq below a vertical depth of 150m assuming an underground mining scenario

Chris Collins, P. Geo., President of Apogee stated; "The acquisition of the Cachinal property provides an increase in Apogee's silver resource base and also provides a second advanced project from which Apogee hopes to expand its South American silver resources. Development of Apogee's Pulacayo silver project in Bolivia remains a top priority for the Company, however, the Cachinal property provides an exciting new property in an area where Apogee can leverage its strong South American team's expertise."

Property Description, Cachinal Property

The Cachinal property comprises 59 contiguous Chilean mining claims which cover an aggregate area of 16,800 hectares. The claims extend for approximately 21 km north-south along the Paleocene Gold Belt of northern Chile, which is host to several significant gold and silver deposits. The property includes 9,200 hectares in mining claims in which Valencia has earned or is earning an equity interest subject to various farm-in and joint venture option agreements as summarized below. The property also includes 7,600 hectares in mining claims which are 100% owned by Valencia.

  • Silver Standard Resources Inc Joint Venture – Valcencia has earned an 80% equity interest (3,300 hectares)
  • Atna Resources Ltd Joint Venture - Valencia is earning a 70% interest (1,800 ha)
  • Minera Aurex (Chile) Ltda Joint Venture – Valencia is earning a 100% interest (4,100 hectares)

The location and disposition of the mining claims that comprise the property is detailed in Figure 1 below:

http://media3.marketwire.com/docs/apefig1105.jpg

David Gower, P. Geo., CEO of Apogee, a qualified person as defined by NI 43-101 has reviewed and approved the technical information in this release.

Completion of the acquisition remains subject to, among other things, receipt of all regulatory approvals, including the approval of the TSX Venture Exchange. The acquisition is a non-arm's length transaction for the purposes of the TSX Venture Exchange as Apogee and Valencia have a common director, being Mr. Stan Bharti, and a common officer, being Mr. Greg Duras who is the Chief Financial Officer of both Apogee and Valencia.

About Apogee Minerals

Apogee Minerals Ltd. is a Canadian company listed on the TSX Venture Exchange under the symbol APE. Apogee pursues advanced silver-zinc-lead projects in South America that demonstrate the potential to be rapidly developed to production. Apogee's other projects is located in the historic silver producing region southwest Bolivia. The Pulacayo-Paca project is an option to joint venture with a subsidiary of Golden Minerals Company and occupies the property that includes the second-largest silver mine in the history of Bolivia with over 600 million ounces of past production.

Forward Looking Statements

Except for statements of historical fact relating to the Company, certain information contained herein constitutes "forward-looking information'" under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the acquisition of the Cachinal property, mineral resource estimates and the ability to realize such estimates; projected mineral production and economics of such production; economic and scoping studies, projected capital and operating expenditures; metal prices; permitting time lines and permitting; availability of skilled labour; ability to develop mining operations; government regulation of mining operations; and environmental risks. 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 statements that certain actions, events or results "may'', "could'', "would'', "might'' or "will be taken'', "occur'' or "be achieved''. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Estimates regarding the mineral resources are based on the assumptions and parameters set out above and on advice from independent, qualified consultants. Estimates regarding the economics of projected production are based on preliminary analysis conducted by Apogee management and have not been verified by independent experts. Assumptions underlying these estimates include future metal price projections, ability to finance development costs of such development, research and experience of Apogee management. 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 risks described in the public record of the Company posted under the profile of the Company on SEDAR at www.sedar.com. Although management of 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 statements 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.

 

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