Chieftain Metals Inc.

Chieftain Metals Inc.

October 19, 2012 13:28 ET

Chieftain Completes $9.9 Million Financing with Strategic Partners

TORONTO, ONTARIO--(Marketwire - Oct. 19, 2012) - Chieftain Metals Inc. ("Chieftain" or the "Company") (TSX:CFB) is pleased to announce that it has closed the second tranche of its previously announced $9.9 million non-brokered private placement, with the issuance in the second tranche of 1,575,566 Chieftain shares at $4.00 per share, to Procon Holdings (Alberta) Inc. ("Procon"), a majority owned subsidiary of China CAMC Engineering Co., Ltd. ("CAMCE" and, together with Procon, the "Strategic Partners").

Procon also received a warrant to acquire additional shares in order to increase its interest in the Company to 30% on a fully diluted basis, at a price of $5.00 per share ("Warrant Shares"), exercisable within 90 days conditional upon full project financing being arranged by the Strategic Partners and Chieftain for the Tulsequah project on terms acceptable to Chieftain, as described in the Memorandum of Understanding previously entered into between Chieftain, CAMCE and Procon. At Procon's option, one-half of the Warrant Shares may be issued on a flow-through basis.

Mr. Victor Wyprysky, President and CEO stated, "We are pleased to close the financing with Procon, which joins Chieftain as a strategic partner in the development of Tulsequah. This investment provides funding for the optimization work required to complete the feasibility study, on-site project activities, as well as corporate working capital."

About Procon Holdings (Alberta) Inc.:

Procon Holdings (Alberta) Inc. is a full service mining contractor, headquartered in Burnaby, British Columbia.

Procon advises that, after giving effect to the second tranche of the private placement, it owns 2,871,774 common shares of Chieftain, representing approximately 19.7% of the issued and outstanding common shares of Chieftain, and a warrant to acquire additional common share to hold 30% of Chieftain calculated on a fully-diluted basis (including the Chieftain shares already held by it).

Procon also advises that it has acquired the securities of Chieftain under the private placement for investment purposes and to facilitate the transactions contemplated by the MOU. The parties are relying upon the "accredited investor" exemption from the prospectus requirements of applicable securities laws in connection with the purchase of these securities.

About Chieftain Metals Inc.:

Chieftain Metals Inc.'s principal business is the acquisition, exploration and development of mineral properties. Since incorporation, the Company's business has focused entirely on the acquisition, and thereafter the development, of the Tulsequah Chief Polymetallic Project, in north-western British Columbia, Canada. The Tulsequah Project consists of 38 mineral claims and Crown-grants covering approximately 14,220 hectares and covers two previously producing mines. For more information on the Tulsequah Project, please refer to the Company's NI 43-101 compliant technical reports, "Tulsequah Chief Deposit, Tulsequah Chief Property, Northern British Columbia" and "Big Bull Project, Tulsequah Chief Property, Technical Report, Northern British Columbia", each dated as of November 8, 2010 and available under the Company's profile on SEDAR (

Forward-Looking Information:

This press release includes certain "forward-looking statements" within the meaning of the Ontario Securities Act or other laws or regulations. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential mineralization, mineral resources or reserves, exploration results, future plans and objectives of Chieftain Metals Inc. are forward-looking statements that involve risks and uncertainties. Forward-looking statements contained herein are made as of the date of this press release and Chieftain Metals Inc. disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise except as required by law. There can be no assurance that such statements will prove to be accurate and 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.

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