Pershimco Resources Inc.

Pershimco Resources Inc.

May 31, 2006 09:46 ET

Pershimco Resources Signs Financing and Co-Development Agreement for its San Miguel Silver Property in Mexico

ROUYN-NORANDA, QUEBEC--(CCNMatthews - May 31, 2006) - PERSHIMCO RESOURCES INC. (TSX VENTURE:PRO) is pleased to announce that it has entered into a financing and co-development agreement with Dia Bras Exploration (TSX VENTURE:DIB) to develop its San Miguel property in the Cusi region of the Chihuahua district, northern Mexico.

Pursuant to the terms of the agreement, Dia Bras shall pay US$200,000 and, subject to regulatory approvals, subscribe CA$340,000 to a private placement of 850,000 units at $0.40 per unit in Pershimco, for an option to acquire an interest up to 70% in the San Miguel property at the following conditions:

- Dia Bras must incur US$1,500,000 of exploration expenses to gain
a 50% interest in the coming twelve-month period;

- After gaining the 50% interest, Dia Bras must incur US$2,500,000
of exploration, development and bulk sampling (minimum of 10,000
tonnes) expenses to gain a 20% additional interest in the coming
30-month period.

The units subscribed by Dia Bras shall comprise one common share of Pershimco and one purchase warrant entitling the holder thereof to acquire an additional common share of Pershimco at a price of CA$0.40 during a twelve-month period.

"We are very pleased to be party to this agreement, as it will enable Pershimco to accelerate the development of its San Miguel property while sharing the risk inherent in the development of a mining property," stated Roger Bureau, President of Pershimco Resources.

The San Miguel silver property covers 36 hectares and is subject to a 2% NSR of which 1% can be bought back for an amount of US$1 million.

It hosts a vein-type mineralized structure in one of the most promising areas in Mexico. The structure is a polymetallic vein containing up to 20% sulfides (pyrite, silver-bearing galena, argentite and sphalerite). It varies in thickness from 1.05 to 1.75 metres but reaches 5.85 metres at the end of the 300 level drift. The highest grade is 503.2 g/t silver over 5.85 m or 409.4 g/t over 7.5 m. San Miguel was the most productive mine in the region, yielding 250,000 to 300,000 tonnes of ore to a depth of 152 metres. Some silver mines in the area were mined to a depth of 500 metres, which indicates very good potential.

Infrastructure already existed on the property and was rehabilitated by Pershimco in 2005. The electrical systems were updated and a submersible pump was replaced to dewater the mine to the 300 level, which corresponds to the top of the sulfide zone (90 m depth). This work was followed by a channel sampling program, with 23 samples taken in seven channels (see press release dated January 11, 2006). The exploration work was overseen by Andre Liboiron, geologist and qualified person under National Instrument 43-101.

About Dia Bras Exploration

Dia Bras is a Canadian mining exploration company focused on base and precious metals projects in the state of Chihuahua, Mexico. The company is conducting exploration and development on two key projects, Bolivar and Promontorio, located in the Sierra Madre precious metals belt. The company's securities are listed on the TSX Venture Exchange under the symbol DIB.

About Pershimco Resources

Pershimco is a Canadian mining exploration company involved in the development of two high-potential properties, the Courville gold property, 40 km from Val-d'Or, Quebec, and the San Miguel silver property, in northern Mexico. Pershimco's securities are listed on the TSX Venture Exchange under the symbol PRO.

Forward-looking Statements: With the exception of historical data, the statements made in this press release may contain elements subject to certain risks and uncertainties. Actual events and results could differ materially from the forecasts and expectations expressed by the Company.

Subject to TSX VENTURE approval.

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

Contact Information

  • Pershimco Resources
    Roger Bureau, President
    1 (866) 797-2180
    Sun International Communications
    Nicole Blanchard, President
    (450) 627-6600