Lara Exploration Ltd.

Lara Exploration Ltd.

January 24, 2011 07:00 ET

Lara Exploration Ltd.: Additional Royalty Negotiated for the Curionopolis Iron Ore Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 24, 2011) - Lara Exploration Ltd. (TSX VENTURE:LRA) ("Lara" or the "Company") is pleased to report that it has agreed with its partner Vertical Mineração Ltda., ("Vertical") that Vertical will pay Lara a royalty of US$0.75/ton on sales of fine-grained iron ore from the Curionópolis Project. This royalty is in addition to the US$1.50/ton (rising to US$2.00/ton after 5 years) that Lara will receive from sales of granular iron ore produced.

Under the terms of the original agreement Lara has ceded an area of 1,348.46 hectares of the Curionópolis Property to Vertical in exchange for US$1.4 million in cash (US$100,000 paid to date) payable over two years from publication of the transfer that occurred on November 24, 2010, or within six months of the start of trial mining and US$3 million in exploration investments.

During 2010, Vertical completed 17 diamond drillholes on the Serra Morena target and is currently completing a program of bulk sampling from pits and trenches, at Serra Morena and two other targets, to define near-surface granular iron ore resources. Diamond drilling is planned to recommence in the first quarter to infill the 2010 drilling at Serra Morena and test other target areas on the property. Vertical plans to complete permitting and start trial mining in mid-2011 and to complete exploration and resource calculations for the complete property by the end of the year.

"Given that drill results from 2010 show the iron formations to be considerably more extensive than first thought, we are very pleased to have also secured a royalty on the finer material," commented Company CEO Miles Thompson, "and we're also very encouraged by the steady progress being made with the exploration and development work by Vertical."

Qualified Person: Michael Bennell, Lara's Vice President Exploration and a member of the Australasian Institute of Mining and Metallurgy (AusIMM), is a Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects and is responsible for the preparation and verification of the technical information in this release.

About Lara

Lara is an exploration company following the prospect generator business model, which aims to minimize shareholder dilution and financial risk by generating prospects and then exploring them in joint ventures funded by partners. The Company currently holds a diverse portfolio of prospects and deposits in Brazil, Peru, Colombia and China, with eight in actively funded joint ventures. Lara's common shares trade on the TSX Venture Exchange under the symbol "LRA".

Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Lara Exploration Ltd.
    Miles Thompson
    Lara Exploration Ltd.
    Andre Gauthier
    +1-604-688-1157 (FAX)
    Lara Exploration Ltd.
    Chris MacIntyre
    Investor Relations