Colt Resources Inc.

Colt Resources Inc.

April 02, 2007 15:13 ET

Colt Signs with Rio Narcea for the Penedono Gold Project

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - April 2, 2007) - Colt Capital Corp. (the "Company" or "Colt") (CNQ:COLT) is pleased to announce that it has entered into a Binding Letter of Intent (the "LOI") with Rio Narcea Gold Mines S.A. of Portugal ("Rio Narcea Portugal") the Portuguese branch of Rio Narcea Gold Mines S.L. of Spain ("Rio Narcea Spain"), which is a wholly owned subsidiary of Rio Narcea Gold Mines Ltd. of Canada ("Rio Narcea Canada") whereby, under certain terms and conditions, Rio Narcea Portugal will assign to Colt ("the Assignment") all of the rights, benefits and obligations of Rio Narcea Portugal covered under the Exploration contract dated October 29, 2004 between the Government of Portugal and Rio Narcea Portugal in respect to the Penedono Gold Property (the "Penedono Exploration License").

Colt and Rio Narcea Portugal have agreed to negotiate in good faith a mutually satisfactory definitive agreement (the "Definitive Agreement") incorporating the terms of the LOI as well as such other terms and conditions as are customary in transactions of this nature. The respective obligations of the parties for closing the contemplated transaction are subject to the satisfaction of certain conditions which shall include, but not be limited to, the approval of the Portuguese Government of the Assignment and to certain proposed amendments to the existing terms and conditions of the Penedono Exploration License. It is anticipated that the Closing Date of the contemplated transaction shall take place on or before June 29, 2007.

As consideration for the Assignment, Colt will issue to Rio Narcea Canada, as fully paid and non-assessable, 1,000,000 restricted common shares of Colt on the Closing Date of the contemplated transaction. Of these 1,000,000 restricted common shares, 250,000 common shares will be freely tradeable after six (6) months from the Closing Date, 250,000 common shares after nine (9) months from the Closing Date, 250,000 common shares after twelve (12) months from the Closing Date and 250,000 common shares after fifteen (15) months from the Closing Date. Furthermore, from Commercial Production and under certain terms and conditions, Colt shall be obligated to pay to Rio Narcea Canada 1% Net Smelter Returns Royalty for a maximum amount of US $1,000,000.

In respect to this transaction, as finder's fee, Colt will issue to an arm's length third party as fully paid and non-assessable 100,000 common shares of Colt on the Closing Date of the contemplated transaction.

The Penedono Exploration License covers an area of approximately 205 square kilometers and is located in north-central Portugal in a sparsely populated farming area which is well suited to exploration and mining. It has been reported that, approximately 3 km northwest of the town of Penedono, a small underground gold mining operation by the name of San Antonio Mine formerly produced and processed up to 500 t/day with a reported grade of 10g/t Gold before closing down its operations in 1957 apparently due to unfavourable gold prices. The Penedono Gold Project represents well developed, permitted and untested, drill ready targets. The Project has an established infrastructure that could enable an immediate entry into a potential district of Gold Production.

Colt Capital Corp.

Bedo H. Kalpakian, Chairman and CFO

Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement in this release containing words such as "believes", "plans", "expects" or "intends" and other statements that are not historical facts are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.

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