Lalo Ventures Ltd.

Lalo Ventures Ltd.

September 06, 2005 09:00 ET

Lalo Ventures Options Nicaraguan Gold Properties; Announces Placement

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 6, 2005) - Lalo Ventures Ltd. (TSX VENTURE:LAL) today announced it has been assigned an option agreement to earn up to 100% interest of a portfolio of Nicaraguan gold properties. This substantial land package consists of 15 mineral concessions totalling 647,353 hectares (1,590,000 acres) which cover a trend along a highly prospective area of Central Nicaragua - the Central American Gold Belt. Ten of these concessions covering 447,189 hectares have already been granted or are waiting for final approval.

To date, this belt has been defined by a number of deposits and mines discovered in Guatemala, El Salvador, Nicaragua, and Costa Rica - all appearing to follow a common trend. In Guatemala, the Marlin and Cerro Blanco deposits are found along this trend; in El Salvador, the El Dorado, Potosi, Pedernal and San Sebastian deposits; in Nicaragua the Villanueva, Cinco Pinos, El Limon, La Libertad and Topacio deposits; and in Costa Rica the Crucitas, Conchudita and San Antonio deposits. The Nicaraguan sector of the Central American Gold Belt which stretches between Villanueva and the Costa Rican border has barely been subjected to modern mineral exploration techniques. The area of interest stretches along a 50 by 200 kilometre belt extending from the Cinco Pinos - Vilanueva mining district on the northeast to the Sebaco district on the Southeast. Previous work in the area manifests a geological environment featuring igneous, tectonic and structural settings which are favourable to the formation of epithermal gold deposits.

The Nicaraguan portfolio includes four areas:

1. To the northwest, the Achiote project consists of two concessions covering 85,000 hectares (210,000 acres) in the vicinity of the Santa Lucia Concession.

2. Adjacent to the southeast, the Cuapa project consists of six concessions covering 228,000 hectares (563,000 acres) and is located in the vicinity of the La Libertad Mine in the Central Part of Nicaragua.

3. To the southeast, the Acoyapa project consists of four concessions covering 181,000 hectares (447,000 acres) extends southward in the vicinity of La Batea and Santa Rosa Concessions.

4. To the extreme southeast, the Rama project consists of three concessions covering 146,000 hectares (360,000 acres) and is located in the vicinity of the Topacio deposit

Approximately US$7 million dollars in exploration was completed on these concessions and surrounding areas by a large international mining company between 1994 and 1998. However, no drilling was conducted due to budget cutbacks. Lalo is compiling the data from this work, including 12,600 sediment, rock and soil samples, to identify priority targets.

"We are very pleased to be optioning such a large land package that has had significant reconnaissance work completed on it in the past," says Ari Sussman, President. "We intend to advance these projects to the drill ready stage in our search for bulk tonnage epithermal gold systems."

The option on these concessions was assigned to Lalo from 2059927 Ontario Limited ("205") with Mr. Frank Mena Marenco ("Mena"). Mena is an arms-length individual well respected in Nicaragua for both his business acumen and ability to generate high impact mineral exploration projects. 205 is a company controlled by Ari Sussman who in turn is Lalo's current President and CEO. Mr. Sussman is not receiving any compensation from this assignment to Lalo, only the reimbursement of costs.

Lalo will initially earn up to 80% interest in each concession from Mena under the following conditions:

1) Cumulatively up to 3 million shares of Lalo will be issued to Mena in the following manner: Lalo will issue 200,000 shares for each of the 15 concessions in 4 equal installments of 50,000 shares. The first installment will be issued upon the formal granting of the concession, while the latter 3 equal installments will be issued at 6, 12 and 18 months respectively after the initial installment.

2) Lalo must expend a minimum of US$100,000 and pay Mena US$50,000 per concession within 4 years from approval of this agreement.

3) Lalo must reimburse 205 for US$50,000 already paid to Mena upon signing of the agreement.

Upon earning 80% in a concession, Mena will have 60 days to elect to convert his 20% working interest to a 2% NSR. In the latter event, Lalo can acquire half of the NSR for US$1,500,000, payable in stock, with right of first refusal over the remaining 1% NSR payable in cash, should Mena decide to sell that remaining interest. Mena has entered into a consulting agreement to provide necessary support for Lalo to operate effectively in Nicaragua.

This agreement is subject to the approval of the TSX Venture Exchange, and the shares issuable under this agreement may be subject to escrow requirements under applicable securities regulations. Mining concessions in Nicaragua are subject to a schedule of surface land payment fees which increase per hectare held each year over the first ten years. To date, Lalo has expended US$48,000 in land payment fees for the initial 10 concessions.

Lalo has retained Coast Mountain Geological Ltd. of Vancouver to review the projects and plan and conduct a Phase 1 exploration work program.

Private Placement

Lalo also announces a non-brokered private placement for up to three million units at $0.25, consisting of one common share and one-half warrant. Each whole warrant entitles the holder to purchase an additional common share of Lalo at $0.40 for a period of 18 months. If the share price of Lalo trades above $0.80 for 20 straight days, Lalo has the option to force the exercise of the warrants. The private placement will be subject to a four month hold from the date of closing. The proceeds will be used for exploration on both the Nicaragua and Mexico portfolio of properties with the balance going to working capital.

Corporate Matters

In other matters, the Company reports that, subject to the approval of the TSX Venture Exchange, it has granted 40,000 incentive stock options to certain consultants of the Company. The options have an exercise price of $0.35 per share and expire on September 2, 2010.

Lalo Ventures intends to build shareholder value by acquiring, exploring, and developing high-quality gold and Iron Oxide Copper-Gold ("IOCG") prospects in Baja California, Mexico and in Nicaragua. The Company has assembled an impressive portfolio of properties covering over 220,000 hectares of strategically located, highly prospective and under-explored ground in Baja. Targets include four hydrothermal gold and seven IOCG prospects; the latter are on trend with the Anglo-Cardero joint venture ground. Lalo's 30,000 hectare Xilma IOCG concession borders to the south on Anglo/Cardero's Main Alisitos property. In Nicaragua, Lalo has 4 hydrothermal gold projects covering 647,000 hectares.

Statements in this news release, other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, constitute Forward-looking statements. Such statements are based on numerous assumptions and are subject to all the risks and uncertainties inherent in the Company's business, including risks related to mineral exploration and development. Consequently, actual results may vary materially from those described in the forward-looking statements.

52-week range $0.175-$0.70

19.7 million Shares Outstanding

The TSX Venture exchange has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.

Contact Information

  • Lalo Ventures Ltd.
    Ari Sussman
    (416) 643-7655
    Lalo Ventures Ltd.
    Eugene Toffolo
    (604) 683-6185 or 1-877-683-6185