Crazy Horse Resources Inc.
TSX VENTURE : CZH

Crazy Horse Resources Inc.

January 15, 2010 09:30 ET

Crazy Horse to Acquire Philippine Copper Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 15, 2010) - Crazy Horse Resources Inc. (TSX VENTURE:CZH) (the "Company"), a Vancouver based mineral exploration company, announces that it has entered into a Letter of Intent dated January 14, 2010 with Asian Arc Minerals Corp. ("Asian Arc"), to purchase Asian Arc's 100% interest in two mining exploration permit applications (the "Permits") covering the Kayapa Copper-Gold Porphyry Project in Nueva Viscaya Province, Philippines (the "Acquisition").

Proposed Acquisition

Under the terms of a the Letter of Intent, the Company has agreed, subject to the satisfaction of certain conditions precedent, to acquire all of Asian Arc's 100% interest in the Permits in exchange for the issue of 6,000,000 common shares of the Company and assuming all obligations of Asian Arc relating to the underlying property acquisition. The Acquisition is arm's length, and if completed will constitute a "fundamental acquisition" under the TSX Venture Exchange's policy.

The parties' obligations to complete the Acquisition are subject to the satisfaction of the usual conditions precedent including:

(a) the Company being satisfied with the results of its due diligence review in connection with the Acquisition, including the receipt of a satisfactory independent National Instrument 43-101 ("NI 43-101") compliant technical report on the Kayapa Project;

(b) the execution of a definitive binding asset purchase agreement between the parties;

(c) the receipt of all necessary approvals of the Exchange and all other regulatory authorities and third parties to the Acquisition;

(d) the completion by the Company of a private placement in an amount to be agreed by the parties to provide the funds necessary to complete exploration work on the Permits.

Summary of the Kayapa Copper Project

The following is a brief summary of the Kayapa Copper-Gold Porphyry Project (the "Project"). Further quantitative information concerning the Project will be disclosed following completion of a "qualifying report" in accordance with National Instrument 43-101, which is presently being prepared.

The Project is comprised of two mining exploration permit applications (EXPA-II-00074 and EXPA-II-00077) over two contiguous claim blocks covering a combined total area of 8,545.5 hectares hosting a large and only partly explored copper-gold porphyry deposit similar to other copper-gold porphyry deposits previously mined in the Philippines. The Project is located in north-central Luzon, Philippines in a well developed mining province and readily accessible by road located 15km north-east of the commercial centre Bambang and 145km from a deep water port at Poro Point, San Fernando, La Union.

The copper-gold porphyry mineralization at the Project is hosted by and related to the quartz diorite porphyry stock which is roughly 3.5km x 2.0km in dimension. Alteration at the Project is predominantly phyllic with silica flooding in the mineralized zone. The mineralized zone defined by historical drilling and adits is approximately 450 meters by 1600 meters in length, and is open at depth and also open on strike to the north and south. The total extent of the mineralization is unknown at this time, with known historical mineralization in drill logs and assays to a depth of over 500 meters.

An economically significant aspect of the explored portion of the Project is the potential to quickly define a viable copper oxide deposit. Historical work completed by Philex Mining Corp. between 1966 and 1979 included the drilling of 39 drill holes totalling 9307 meters and 1580m of adits, tunnels and crosscuts. All drill holes intersected copper mineralization, including one hole which bottomed in copper mineralization greater than 0.55% at a depth of 533 meters and one hole which averaged 0.78% copper and 0.48g/t Au over its entire length of 166 meters. Information from drill logs show an oxide cap extending to a depth of up to 60 meters. Based on the work completed by Philex, the copper oxide zone remains open but is defined to be at least 1,500 meters by 400 meters.

If an average depth of oxide mineralization between 20 to 60 meters is assumed (based on oxidation levels reported by Philex Mining Corp. in their drill logs) for the entire area of the known drilled deposit, the copper oxide zone would generate between 32 and 96 m/t of oxide resource at an average grade of greater than 0.6% Cu (based on 1580m of channel sampling in tunnels within the deposit).

All above assays and drill intersections are historical, and any resource alluded to or mentioned is non NI 43-101 compliant. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves. The Company is not treating the historical estimate as current mineral resources or mineral reserves as defined in NI 43-101. The Company cautions the reader that the historical estimates disclosed in this news release should not be relied upon.

Further, the above estimates of potential quantity and grade of potential mineralization are conceptual in nature as there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in any part of the Project being delineated as a mineral resource.

A proposed initial work program consisting of approximately 16,000 meters of RC and diamond drilling is proposed to establish an NI 43-101 compliant copper oxide resource and confirm some of the historical drilling at depth.

Proposed Private Placement

The Company announces its intention to complete a non-brokered private placement consisting of the issuance of up to 1,000,000 common shares of the Company at a price of C$0.50 per common share, for gross proceeds of up to C$500,000.

The proceeds of the private placement will be used to provide working capital to complete due diligence and any transaction costs associated with the completion of the Acquisition. The proceeds will not be sufficient to undertake drilling on the Project; and as such the Company expects to raise additional financing in conjunction with closing the Acquisition.

General

Completion of the Acquisition is subject to a number of conditions, including but not limited to, satisfactory due diligence, all necessary approvals including the acceptance of the TSX Venture Exchange. There can be no assurance that the Acquisition will be completed as proposed or at all.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

ON BEHALF OF THE BOARD

Darren Devine, President and CEO

This press release includes "forward-looking statements" including forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Crazy Horse Resources Inc. Statements regarding future fund raising and completion of the Acquisition are subject to all of the risks and uncertainties normally incident with the raising of capital and completing corporate transactions including, but are not limited to, financing risks, inflation and costs of goods and services, property title issues and regulatory approvals. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Crazy Horse Resources Inc. does not assume the obligation to update any forward-looking statement, except 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 responsiblity for the adequacy or accuracy of this release.

Contact Information

  • Crazy Horse Resources Inc.
    Darren Devine
    President and CEO
    604-638-8067
    604-648-8105 (FAX)