Calibre Mining Corp.
TSX VENTURE : CXB

Calibre Mining Corp.

September 09, 2015 09:15 ET

Calibre and Centerra Gold Sign Option Agreement on the La Luz Project, Nicaragua

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sept. 9, 2015) - Calibre Mining Corp. (TSX VENTURE:CXB) (the "Company" or "Calibre") is pleased to announce that the Company and Centerra Gold Inc. ("Centerra") have signed an option agreement dated September 8, 2015 whereby Centerra can earn a 51% interest and subsequently an additional 19% for a total of 70% interest in the La Luz Gold-Silver Project (the "La Luz Project") consisting of 1200 hectares within the Borosi Concessions, Northeast Nicaragua. The La Luz Project includes the past producing La Luz Gold-Silver Mine, the Cerro Aeropuerto Project that hosts a NI 43-101 compliant gold-silver Inferred resource as well as a series of previously drilled gold-silver targets. Additionally Calibre has granted Centerra the Right of First Refusal on the Company's 100% owned 24,134 hectare Montes de Oro Project, located approximately three kilometres from the La Luz Project. Unless otherwise specified, all amounts set out in this news release are expressed in Canadian dollars.

Highlights

  • La Luz First Option: To earn a 51% interest in the La Luz Project, Centerra must invest $3.0 million in exploration on the property from signing to December 31, 2017;
  • A commitment to commence a drilling program in 2015;
  • La Luz Second Option: Once vested at 51%, Centerra can elect to earn an additional 19% in the La Luz Project for a total of 70% by investing a further $4.0 million in exploration on the Project over a subsequent two year term;
  • The total potential investment by Centerra under the La Luz First and Second Options is $7.0 million from signing to December 31, 2019;
  • The La Luz Project includes the past producing La Luz mine and the NI 43-101 compliant inferred resource at Cerro Aeropuerto;
  • Calibre has granted a Right of First Refusal to Centerra for an option/joint venture on Calibre's 100% owned Montes de Oro Project for so long as Centerra continues to fund the La Luz Project under the First Option or to such a time that Centerra earns a 70% interest of the La Luz Project.

President and CEO, Greg Smith stated: "Calibre is extremely pleased to have Centerra, a mid-tier gold producer, as our partner on the La Luz Gold-Silver Project. This agreement with Centerra continues Calibre's strategy of partnering with high quality, well-funded, gold producers on strategic land areas while allowing the Company to focus on its 100% owned exploration concessions. The La Luz Project is a small concession in the heart of this historic mining district which includes the past producing La Luz Mine and the Cerro Aeropuerto gold-silver resource. The Project has existing permits which allow for immediate commencement of drilling to test high priority targets. We welcome Centerra to Nicaragua where they join IAMGOLD, B2Gold Corp and Rosita Mining Limited as Calibre's partners in advancing the gold-silver-copper potential of the Borosi concessions."

Significant Terms of the CALIBRE - CENTERRA Option Agreement - La Luz Project

  1. First Option: Centerra has the option to earn a 51% interest in the La Luz Project. The option consists of:
    1. Centerra to invest $3.0 million in exploration on the La Luz Project over 2.5 years;
    2. commitment to commence a drilling program in 2015;
    3. Centerra will develop exploration budgets and plans while work will be completed by Calibre for the term of the first option;
    4. Centerra to have the right to take over operatorship following the conclusion of the first option, or such later time as the parties agree;
    5. During the period that Calibre operates it will receive a 10% overhead recovery fee on all costs incurred on the project except government payments and drill contracts for which the overhead fee will be 5%.
  1. Second Option: Centerra to earn an additional 19% in the La Luz Project over the subsequent two years by spending an additional $4.0 million in exploration expenditures on the La Luz Project.
  1. At such time as Centerra exercises the Second Option, or elects not to enter into the Second Option, the parties will form a Joint Venture to advance the La Luz Project. The participation ratio of Centerra to Calibre interests being 51:49 or 70:30 depending on whether the 2nd Option has been exercised.
    1. Should a Party elect not to participate in a work program a standard straight-line dilution formula will apply;
    2. Dilution to a 10% direct joint venture interest results in the interest being converted to a 2% net smelter royalty (NSR), which is subject to a buy-back right of 50% for $2 million (in favour of the non-diluting party).

The 1200 hectare La Luz Gold-Silver Project is located in the south-west portion of the Borosi Concessions and contains the past producing La Luz Mine that produced 17.1 million tonnes of ore grading 4.14 g/t gold (2.3 million ozs gold) between 1912 and 1968. One kilometre south of the La Luz Mine, Calibre has defined an NI 43-101 Inferred Mineral Resource, at the Cerro Aeropuerto gold-silver deposit containing 707,750 ozs gold and 3.1 million ozs silver (see Calibre News Release dated February 28, 2011).

La Luz Gold-Silver Project - Cerro Aeropuerto Deposit NI 43-101 Inferred Resource;

Tonnes Grade
(Au g/t)
Grade
(Ag g/t)
Grade
(Aueq g/t)
Contained
Au
(ounces)
Contained
Ag
(ounces)
Contained
Aueq
(ounces)
6,052,000 3.64 16.16 3.89 707,750 3,144,500 757,000
  1. Resource models used Inverse Distance grade estimation within a three-dimensional block model with mineralized zones defined by wireframed solids and a base cutoff grade of 0.6 g/t.
  2. Resource Estimate for Cerro Aeropuerto detailed in Technical Report titled NI 43-101 Technical Report and Resource Estimation of the Cerro Aeropuerto and La Luna Deposits, Borosi Concessions, Nicaragua by Todd McCracken, dated April 11, 2011.
  3. Numbers may not add exactly due to rounding.
  4. Gold Equivalent (AuEq) for Cerro Aeropuerto was calculated using $1058/oz Au for gold and $16.75/oz Ag for silver, and metallurgical recoveries and net smelter returns are assumed to be 100%.
  5. Mineral Resources that are not mineral reserves do not have economic viability
  6. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.

Centerra and Calibre have discussed the objectives for the initial 2015 exploration program on the La Luz Project and diamond drilling is expected to commence in the near term. Previous work by Calibre has outlined a series of high priority drill targets including the footwall zone to the historic La Luz mine at Cerro Potosi and potential extension to Cerro Aeropuerto.

Immediately adjacent to the La Luz Mine is the Cerro Potosi Target which hosts near-surface, gold-bearing garnet-epidote skarn mineralization parallel to and in the footwall of the historic mine. In 2008, Yamana Gold Inc. completed a drill program that highlighted several near surface intercepts including; 16.2 metre grading 4.18 g/t gold (39.3m - 55.5m), 32.0 metre grading 2.50 g/t gold (56.0m - 88.0m), and 15.0 metre grading 1.78 g/t gold (39.0m - 54.0m)*. Calibre completed sampling in 2015 at Cerro Potosi and continuous chip sampling of outcrop returned 10.2 metres grading 2.05 g/t Au and 178.1 g/t Ag. Additionally selected grab samples of mineralized skarn material included up to 18.9 g/t Au and 96.0 g/t Ag (see Calibre News Release dated March 19, 2015).

*The Company cautions that it has not verified the quality and accuracy of the historic sampling and drilling results, and while the historic figures were generated from sources believed to be reliable and are relevant, readers are cautioned not to rely upon them.

Concurrent with the option agreement, Calibre has granted a Right of First Refusal to Centerra for an option/joint venture on Calibre's 100% owned Montes de Oro Project for so long as Centerra continues to fund the La Luz Project or, to such a time that Centerra earns a 70 % interest in the La Luz Project. Should Centerra elect not to fund the Second Option or should Centerra earn a 70% interest under the Second Option the Right of First Refusal on the Montes de Oro project will terminate.

The 24,134 hectare, 100% Calibre owned, Montes de Oro Project is located three kilometres north of the La Luz Project. At the Montes de Oro project, work continues to define and expand the existing 1,400 metre x 500 metre surface gold-in-soil anomaly. A Phase I drilling program is underway consisting of approximately 2500 metres in 11 drill holes. Results from the first four holes released on July 2, 2015 include 12.13 metres grading 2.42 g/t Au. Surface exploration including trenching returned results of 52.3 metres grading 7.1 g/t gold, 27.5 metres grading 4.92 g/t gold and 33.5 metres grading 2.10 g/t gold. On the Montes de Oro Project Calibre continues to advance a series of additional gold targets with characteristics similar in geology and geochemical signature to the Montes de Oro discovery including San Miguel, Cerro Aza; and Roskillete where additional rock sampling and trenching is planned following up on the gold in soil anomalies generated in 2014 and 2015.

The technical content in this news release was read and approved by Gregory Smith, P.Geo, President and CEO of the Company who is the Qualified Person as defined by NI 43-101.

About Calibre Mining Corp.

Calibre controls a 100% interest in 355 km2 of mineral concessions in the Mining Triangle of Northeast Nicaragua. Additionally the Company has an option agreement with IAMGOLD covering 176 km2 of concessions, joint venture exploration programs underway with B2Gold Corp. on 208 km2 of concessions which includes the Primavera gold-copper porphyry discovery and the Minnesota Gold Zone, and has optioned the 33.6 km2 Rosita gold-copper-silver project to Rosita Mining Corporation. Major shareholders of Calibre include gold producer B2Gold Corp, Pierre Lassonde and Management.

About Centerra Gold Inc.

Centerra is a North-American based gold mining company focused on operating, developing, exploring and acquiring gold properties primarily in Asia, North America and other markets worldwide. Centerra is the largest Western-based gold producer in Central Asia. Centerra's shares trade on the Toronto Stock Exchange (TSX) under the symbol CG. The Company is headquartered in Toronto, Ontario, Canada.

Calibre Mining Corp.

Greg Smith, P.Geo., President and CEO

Neither the 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.

Cautionary Note Regarding Forward Looking Statements

This news release contains certain forward-looking statements, Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects" or does not expect", "is expected", anticipates" or "does not anticipate" "plans", "estimates" or "intends" or stating that certain actions, events or results " may", "could", "would", "might" or "will" be taken, occur or be achieved) are not statements of historical fact and may be "forward-looking statements". Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to materially differ from those reflected in the forward-looking statements.

Safe Harbor Statement under the United States Private Securities Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information presented constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements including but not limited to those with respect to the price of gold, potential mineralization, reserve and resource determination, exploration results, and future plans and objectives of the Company involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of Atlas to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements

Contact Information