SOURCE: Butler Resource Group

October 07, 2009 09:15 ET

Butler Commences Archie Lake Rare-Earth Sampling Program

VANCOUVER, BC--(Marketwire - October 7, 2009) - Butler Resource Corp. (TSX-V: BTD.H) (the "Company") is pleased to announce the commencement of a sampling program on the recently announced Archie Lake Rare-Earth project, located in northern Saskatchewan (see News Release September 14, 2009).

The work program is being performed by Dahrouge Geological Consulting Ltd., of Edmonton, Alberta, and will entail extensive surface sampling to follow up on historic samples obtained through previous government assessment work on the property. Crews were mobilized to the property on October 4th, with a number of samples having already been sent for rush assays. Following receipt of assay results, the Company intends to commission a technical report on the Archie Lake project in accordance with NI 43-101.

In connection with the completion of the NI 43-101 report on the Archie Lake project and the private placement described below, the Company intends to seek approval from the TSX Venture Exchange (the "Exchange") to reactivate its business and graduate from the NEX Board to the Exchange as a Tier 2 Mining Issuer pursuant to Policy 2.6. Previously, the Company announced a proposed merger with Silver Mountain Mines Corp. (see News Release September 11, 2009), which was originally intended to qualify as the Company's reactivation transaction. Although the Company continues to pursue the proposed merger transaction, the Company has determined that graduation to the Exchange through completion of the proposed work program on the Archie Lake project is likely to occur prior to the closing of the proposed merger. As a result, the Company intends to close the merger following the Company's graduation to the Exchange as a Tier 2 Mining Issuer.

Concurrent with the work program and planned reactivation to Tier 2 on the Exchange, the Company intends to complete a non-brokered private placement of up to 4,000,000 units at a price of $0.25 per unit, for gross proceeds of $1,000,000. Each unit will consist of one common share and one-half of one common share purchase warrant, with each full warrant entitling the holder to purchase one additional common share at a price of $0.35 within 18 months of closing. The closing of the financing is conditional upon the Company receiving Exchange approval to graduate to the Exchange as a Tier 2 Mining Issuer. The Company intends to use the proceeds of the private placement to satisfy Tier 2 maintenance requirements of the Exchange. The share certificates issuable in the private placement will contain a hold period in accordance with applicable securities laws.

Historic exploration and results on the property returned significant concentrations of Rare Earth Elements (REEs). The historic exploration on the area is summarized in February 1971 assessment reports (not NI 43-101 compliant) on file with the Saskatchewan Ministry of Mines. Historic exploration on the property includes an airborne radiometric survey and follow-up prospecting and trenching over one of the anomalies identified. The main showing is postulated to be a paleo-placer type deposit, with monazite crystals constituting up to 50% of the rock in places. The assay reports from the previous exploration showed that ten samples analyzed by spectrographic analysis method showed elevated concentrations of Rare Earth Oxides. Values ranged from 0.1 to 15.7% RE2O3 and averaged 4.04% RE2O3. Individual elemental rare-earth abundances are in the following order: lanthanum, cerium, gadolinium, lutetium, terbium and ytterbium, with trace amounts of scandium and yttrium.

The technical information in this news release has been prepared in accordance with the Canadian regulatory requirements set out in National Instrument 43-101 and reviewed on behalf of the company by Jeffrey Reeder, P.Geo., a qualified person.

On Behalf of the Board,

"Peter Dickie"
Peter Dickie, President, CEO

For further information, contact Peter Dickie, President and CEO of the Company at (604) 669-9330.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of the Company such as the statement that: (i) the Company intends to commission a NI 43-101 report on the Archie Lake project; (ii) the completion of the technical report may occur; (iii) the Company intends to seek approval from the Exchange to graduate from the NEX Board to the Exchange; (iv) the Company intends to close the merger agreement following graduation to the Exchange; (v) the Company intends to close the non-brokered financing of $1,000,000; and (vi) the Company intends to use the proceeds of the private placement to satisfy Tier 2 maintenance requirements of the Exchange. There are numerous risks and uncertainties that could cause actual results and the Company's plans and objectives to differ materially from those expressed in the forward-looking information, including: (i) receipt of approval from the Exchange with respect to the reactivation, the financing and the merger agreement; (ii) the ability of the Company to effect the reactivation and to close the financing and the merger agreement; (iii) general economic conditions; (iv) fluctuations in mineral prices; and (v) the ability of the Company to execute its business plan. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company assumes no obligation to update forward-looking information should circumstances or management's estimates or opinions change.

Contact Information

  • For further information, contact:
    Peter Dickie
    President and CEO
    (604) 669-9330