SOURCE: HuntMountain Resources

April 05, 2007 11:43 ET

HuntMountain Finalizes Deal for the Bajo Pobré Gold Property in Argentina

SPOKANE, WA -- (MARKET WIRE) -- April 5, 2007 -- HuntMountain Resources (OTCBB: HNTM) is pleased to report that it has signed the final contract to acquire a 100% interest in the Bajo Pobré gold property located in Santa Cruz Province, Argentina. Cerro Cazador S.A., HuntMountain's Argentine subsidiary has entered into a lease-purchase agreement with FK Minera S.A., where it can earn up to a 100% equity interest in the Bajo Pobré property by making cash payments and exploration expenditures over a five-year earn-in period.

The required expenditures and ownership levels upon meeting those requirements are:

Year of the Agreement        Payment to        Exploration        Ownership
                             FK Minera S.A.    Expenditures
---------------------        --------------    ------------       ---------
First Year                   $50,000           $250,000           0%
Second Year                  $50,000           $250,000           0%
Third Year                   $75,000           $0                 51%
Fourth Year                  $75,000           $0                 60%
Fifth Year                   $75,000           $0                 100%
After the fifth year, Cerro Cazador shall pay FK Minera the greater of a 1% NSR Royalty on commercial production or a minimum royalty payment of US$100,000 per year. We have the option to purchase the NSR Royalty at any time for a lump sum payment of US$1,000,000 less the sum of all royalty payments made to FK Minera to that point.

"The finalization of the Bajo Pobre deal, combined with the recent acceptance of our bid for the La Josefina property, dramatically enhances our project portfolio and positions HuntMountain as one of the premier exploration companies operating in Santa Cruz Argentina. We firmly believe that both of these advanced prospects have excellent potential to host major precious metal deposits," stated Randal Hardy, President of HuntMountain Resources.

The Bajo Pobré property was discovered in 1970 and has been worked intermittently by several government entities and private companies. Serious exploration began in the 1990s with geologic mapping and surface sampling. Assays from this sampling yielded values up to 40 grams per ton gold. Drill targets identified from surface sampling were augmented in 2002 with additional targets derived from a geophysical survey. In 2003 and 2004, the property saw a limited amount of exploration drilling which tested only a minor percentage of established targets. It is estimated that approximately US$ 4,000,000 has been spent to date on exploration efforts at Bajo Pobré.

The geology of the area is dominated by a Jurassic-aged, andesitic composition, volcanic and volcanoclastic rocks of the Bajo Pobré formation. The property exhibits widespread hydrothermal alteration and precious-metal mineralization. The mineralization is characterized as epithermal in nature, hosted within multiple structurally controlled zones of quartz veining, vein breccias, and stock works having a cumulative strike length of more than 9 kilometers. Individual veins range from 0.5 meters to 6 meters in width.

After a thorough review of the existing database, the Company plans to expeditiously identify and delineate an economic resource by allocating the bulk of exploration expenditures to diamond core drilling of prioritized targets. In addition, a limited percentage of exploration expenditures will be allocated to property-wide reconnaissance in an effort to identify additional drill targets. Cerro Cazador now controls approximately 125,000 acres or more than 1,000 square kilometers of exploration rights in Santa Cruz Province Argentina.

This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy, and some of which might not even be anticipated. This news release is neither a prospectus nor an offer to sell securities or stocks in the company. It is intended for informational purposes only.

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Jonathan Smith
    Investor Relations Manager
    (509) 892-5287
    jsmith@huntmountain.com