Geologix Explorations Inc.

Geologix Explorations Inc.

January 21, 2008 08:14 ET

Geologix Options La Casita Project in Durango State Mexico

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 21, 2008) - Geologix Explorations Inc. (Geologix) (TSX VENTURE:GIX)(FRANKFURT:GF6) is pleased to announce that it has signed a letter of intent to option the 1,472 hectare La Casita - Los Arados claim group, located in central Durango State, Mexico from GFM Resources Ltd. (NEX:GFM.H). The property is easily accessible and located 5.5 km southwest of the town of Rodeo in Durango State, Mexico. Geologix rock-chip sampling on the claim group has returned assays up to 1.84 g/t gold and 247 g/t silver in silicified stockwork and breccia zones hosted in subvolcanic rhyolites found on the property. Colluvium and post mineral volcanics commonly mantle the gold-bearing rhyolites at La Casita-Los Arados, especially along the northeast flank of a prominent peak on the property called Cerro Colorado. In that zone, scattered rhyolite outcrops have returned assays of more than 1 g/t gold along a northwest trending corridor for at least 950 metres. A similar corridor of gold mineralization occurs a kilometre southeast of Cerro Colorado and trends east-northeast along the south flank of a rhyolite ridge called Cerra La Amarilla. That zone is at least 1000 metres long.

Dunham Craig, President and CEO states: "The La Casita property is a perfect compliment to our project portfolio near our San Agustin project which is located a mere 40km to the south of La Casita and where we have three drill rigs operating. Both San Agustin and La Casita host large epithermal systems associated with subvolcanic rocks and both have ore-grade gold mineralization at surface with excellent exploration potential beneath covered areas."

A high-resolution topographic base map of La Casita-Los Arados is currently being prepared from air photos taken over the property in December 2007. Fieldwork consisting of sampling, trenching, and geologic mapping in preparation for drilling is planned for 2008.

The Agreement

In order to acquire a 60% interest in La Casita, Geologix will:

1. Pay GFM Resources Ltd. US $650,000 in cash over a period of up to four years as follows:

a. On signature of a definitive agreement US $ 50,000
b. On or before the first anniversary thereof US $100,000
c. On or before the second anniversary thereof US $125,000
d. On or before the third anniversary thereof US $150,000
e. On or before the fourth anniversary thereof US $225,000
Total US $650,000

2. Fund 100% of an exploration program totalling US $1,875,000, as follows:

a. On or before the first anniversary US $ 125,000
b. On or before the second anniversary US $ 250,000
c. On or before the third anniversary US $ 500,000
d. On or before the fourth anniversary US $1,000,000
Total US $1,875,000

Geologix will maintain the mineral concessions in good standing over the term of the option, and will have the right to accelerate the schedule of payments and work expenditures to earn its 60% interest.

Once Geologix has earned its 60% interest in La Casita, a joint venture between Geologix and GFM Resources Ltd. will be formed. The joint venture operator will be Geologix. The Operator over the following three years, must propose a minimum annual US $625,000 joint venture budget to remain as operator. The joint venture committee may decide to spend less over the period. Both parties may elect to contribute to the proposed budget or have their interest diluted.

A Feasibility Study may be proposed by the Operator, or by the other party if the Operator fails to do so, within three months of the end of the three-year joint venture period. If one of the parties elects not to participate in the funding of the feasibility study, the other party will earn an additional 11% interest in the joint venture by the completion of a positive feasibility study. If the feasibility study recommends taking the property into production and one of the parties does not elect to participate, the other party will earn a further 9% interest.

Geologix Explorations Inc. is a mineral exploration company focused on acquiring, exploring and developing mineral properties in North and South America. The Company has a wealth of experience in the mining industry taking early stage exploration prospects to final feasibility and ultimately to production.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States of America. The securities have not been and will not be registered under the United States Securities Act of 1933 (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws, or an exemption from such registration is available.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Geologix Explorations Inc.
    Michael Mallard
    V.P. Corporate Communications
    (604) 694-1742 or Toll Free in Canada & USA: 1-888-694-1742
    Geologix Explorations Inc.
    Dunham Craig
    President & CEO
    (604) 694-1742 or Toll Free in Canada & USA: 1-888-694-1742