Red Pine Exploration Inc.
TSX VENTURE : RPX

Red Pine Exploration Inc.

October 15, 2009 13:00 ET

Red Pine Exploration Acquires High-Potential Gold Properties; Adding to Abitibi-West Holdings Near Timmins

TORONTO , ONTARIO--(Marketwire - Oct. 15, 2009) - Red Pine Exploration Inc. ("Red Pine" or the "Company") (TSX VENTURE:RPX) announces that it has acquired a high-potential gold property located in the Dore, Swayze and Rollo Townships. The property lies within the south central Swayze greenstone belt, southwest of Timmins, Ontario. 

New Property Located in Classic Environment for Gold Deposits

The "Charlie Mortimer" Project lies immediately contiguous to Red Pine's 100% owned Abitibi-West Property, and consists of 19 claim blocks (37 claim units) and covers over 550 hectares of prospective geology along the Mortimer/Kenty gold trend. The Mortimer claim group adjoins the historic Kenty Mine property (250,000 t of 8 g/t Au) on the west, north and east sides. The land was owned by prospector Charlie Mortimer (the "Seller") and has never been drill-tested.

Visible Gold Found on Project

Recent trenching on the Charlie Mortimer Project has discovered visible gold associated with quartz-carbonate stockwork within strongly chlorite-altered, iron-rich mafic volcanic rocks located at the contact with porphyritic intrusive rocks. Mechanical work continues to expand the new zone as well as others on the property. Recently received rock grab sample assays from this new zone assayed as high as 28 g/t gold in pyritic quartz-carbonate stockwork.

Hadyn Butler, P.Geo. and consultant on the Project has extensive knowledge of the spatial associations of producing gold mines and gold mineralization in the gold camps of Ontario. He comments, "In the past 35 years, gold exploration by companies in the western Abitibi has been scattered and unfocused. Tectonic and geochemical evidence on the origin of mesothermal gold lodes have greatly improved and former assumptions concerning location favorability no longer seem tenable. The two-plus decades of field work done to date by prospector Charlie Mortimer and the results exhibited thus far certainly confirms the gold mineralization potential of the Project".

Red Pine's 100% owned Abitibi-West Property, which immediately abuts the Charlie Mortimer Project, which in itself is a significant land package (372 claim units totaling 5,952 hectares). The addition of the Charles Mortimer Project brings the Company's total land package to 409 claim units, covering approximately 6,502 hectares.

This acquisition now establishes Red Pine as a major land holder of gold properties located within the Swayze greenstone belt, which represents the western extension of the prolific Abitibi greenstone belt.

Company Eager to Commence Ground Work to Define Drill Targets

With gold prices at an all-time high, this latest acquisition meet's Red Pine's strategy to underpin the Company with quality properties in historically high-potential areas for gold mineralization. 

Field examination of "washed" outcrops exposed by Charlie Mortimer has commenced by Red Pine's exploration team, headed up by Exploration Manager Randall Salo, P.Geo. who comments, " The glacial cover over outcrops on the Property is commonly quite thin, which will allow the Company to rapidly map vein systems with trenches and channel sampling. These circumstances will allow Red Pine an opportunity to gain a thorough insight into the geology of the vein systems and their host units and to define drill targets in a reasonable time frame."

The Agreement

In order to acquire 100% of the Property that is located in the Dore/Rollo/Swayze Township area, consisting of 7 claim blocks, and 59% of the Property that is located in the Dore Township consisting of 12 claim blocks, Red Pine is required to:

  1. pay the Seller the sum of $50,000 cash; and
  1. Issue to the Seller an aggregate of one million two hundred & fifty thousand (1,250,000) common shares of Red Pine which will be subject to resale restrictions imposed by applicable securities laws, including a four month hold period on such shares; and
  1. Issue to the Seller one million two hundred & fifty thousand (1,250,000) common share purchase warrants of Red Pine with each whole warrant entitling the holder to acquire one common share for $0.15 for a period of 24 months from the date of issuance which will be subject to resale restrictions imposed by applicable securities laws, including a four month hold period on such common share purchase warrants.

Royalty Agreement

On the 100%-owned portion of the Project, the Seller will be entitled to a 2% Net Smelter Royalty ("NSR"). Red Pine has the exclusive right, at any time, to buy 50% (or 1.0%) of this net smelter return for the sum of one million dollars ($1,000,000). On the 59%-owned portion of the Project, the Seller will be entitled to retain a 1.2% Net Smelter Royalty ("NSR"). Red Pine has the exclusive right, at any time, to buy 50% (or 0.6%) of the net smelter return for the sum of six hundred thousand dollars ($600,000).

In conjunction with the transaction, a finders' fee of 250,000 common shares were issued in lieu of cash. The agreement is subject to completion of due diligence and regulatory approval, including any required approval of the TSX Venture Exchange.

Randall Salo, P.Geo. is the Exploration Manager and is overseeing the field exploration program on behalf of Red Pine, and is the qualified person for the technical information contained in this press release.

WARNING: The statements made in this news release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from expectations and projections set out herein.

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