New Cantech Ventures Inc.

New Cantech Ventures Inc.

November 13, 2006 09:30 ET

New Cantech Ventures Inc. Grants Option to Purchase 60% of Lucky Ship Molybdenum Property and a Carried 60/40 Joint Venture

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 13, 2006) - New Cantech Ventures Inc. ("Cantech") (TSX VENTURE:NCV)(FWB:C7X), is very pleased to announce that it has entered into an Option/Joint Venture Agreement with Palm Clean Energy, Inc. of Seoul, Korea and has granted Palm Clean an option to purchase a 60% interest in Cantech's Lucky Ship porphyry molybdenum property.

In order to exercise the 60% Option, Palm Clean will be required, amongst other things, to put the Lucky Ship Property into continuous production and to fully finance the resulting Joint Venture, including debt financing Cantech's portion of the 60/40 Joint Venture. Cantech is required to re-pay its 40% of the total cost of the Joint Venture out of the cash flow from the Joint Venture. During the term of the Option, Cantech is to be the Operator.

Palm Clean to Purchase $1 Million of Units

Palm Clean is also required to purchase $1 Million of private placement units at the price of $0.50 per unit. Each unit consists of one share and one warrant. Each warrant is exercisable to purchase a further share at the price of $0.75 during the first year and at the price of $1.00 during the second year.

Non Brokered Flow-Through Private Placement

Also, Cantech has agreed to sell, on a non brokered basis, a further $1 Million of flow-through units. The flow-through units have the same terms as the units being sold to Palm Clean except that both the shares and the warrants are flow through securities.

About Palm Clean

Palm Clean is in the resource development industry and consulting business world wide. It is currently developing an open pit coal mine and a deep water sea port in Indonesia. Palm Clean also has a palm tree plantation in Indonesia and is constructing a plant to produce bio-diesel fuel from palm oil.

Terms of the Option to Palm Clean

In order for Palm Clean to exercise its 60% Option, Palm Clean will do all of the following:

(a) within one year from the date of the Option Agreement, incur exploration expenses of at least $3.3 Million, (the "First Year Requirement") (and Cantech is also to use the proceeds a contemporaneous $1 Million private placement by Palm Clean for a total of $4.3 Million), as follows;

(i) within six months following the date of the Option Agreement, incur exploration expenses of at least $1.3 Million, which is a firm commitment of PC (the "First Year-First Stage Requirement") and Cantech is to incur $1M of exploration expense; and

(ii) within one year from the date of the Option Agreement incur further exploration expenses of at least $2.0 Million, which is a firm commitment of PC (the "First Year-Second Stage Requirement");

(b) to incur such further exploration and development expense within the second and third years of not less than $1,000,000 in each of such years in order to provide information necessary to prepare a Bankable Feasibility Study;

(c) pay to the Underlying Optionors from the exploration expense funds 100% of those amounts required from time to time to keep the underlying option in good standing and prior to the exercise of the Option pay 100% of the amounts required to be paid to the Underlying Optionors in order to exercise the Underlying Option;

(d) within six months from delivering the Bankable Feasibility Study:

(i) provide to the Joint Venture 100% of the amount required to be paid by Palm Clean for the development of the Property under the Joint Venture; and

(ii) provide Cantech or cause a third party to provide to Cantech at a rate of interest, reasonably acceptable to Cantech, a debt financing for 100% of the amount needed by Cantech to finance all amounts to be paid by Cantech for the exploration and development of the Property under the Joint Venture, including the establishment of a mine,

(the amounts under (i) and (ii) above are together called the "Senior Financing"), with the amount under (ii) called "Cantech's Portion Of the Senior Financing"); and

(e) either:

(i) within 18 months of the Senior Financing, will use it best efforts and then put the Property into production and keep the Property in production for a period of at least six months at which the rated capacity of the mine has been met for at least 90% of the days of those six months ("Continuous Production"); or

(ii) if PC has used it best efforts to put the Property into Continuous Production within 18 months of the Senior Financing and despite those best efforts PC has not be able to do so, then PC continues without interruption to use its best efforts to put the Property into Continuous Production as soon as possible and does put the Property into Continuous Production as soon as possible, but in any case not more than 36 months of the Senior Financing.

Interim Options

In the event that Palm Clean does not exercise the 60% Option, but completes portions of the requirements to exercise the 60% Option, Palm Clean, at its election, will be granted one of three interim options in the amounts of (a) 18%, (b) 35% and (C) 51% (the "Interim Options"). Palm Clean then will have the further right either (a) not to proceed to a Joint Venture with Cantech or (b) to proceed to a Joint Venture with Cantech.

If Palm Clean exercises any of the Interim Options and elects not to proceed to a Joint Venture with Cantech, then Cantech will have the right to purchase from Palm Clean (the "Buy-Back Right") any interest in the Property earned by Palm Clean under any of these Interim Options for the purchase price being the lesser of (a) what the Asian Corporation put into the Property and (b) $4.3 Million. The Buy-Back Right is exercisable up to the earlier of (a) 10 years from the date of the exercise of the Interim Option and (b) one year following the date on which Cantech receives not less than $3.3 Million under a different joint venture agreement with a third party.

If Palm Clean exercises any of the Interim Options and elects to proceed to a Joint Venture, then Palm Clean will again be required to put the Lucky Ship Property into continuous production and fully finance the Joint Venture.

Pre-Feasibility Study

The Company has retained A.C.A. Howe International of Toronto, Ontario and London, England to conduct a pre-feasibility study on the Lucky Ship Property.

Resumption of Drilling of Deep Hole

Drilling of the 1100 metre diamond drill hole LS06-68 will commence this week.

As previously announced, except for the completion of the deep hole, Cantech has completed Phase 3 drilling program on the Lucky Ship Property. As was announced previously, the last hole planned for the summer 2006 drill program was intended to be a deep hole (1100 metres) that would test an area on the northwest side of the deposit that could contain an additional Mo resource at depth.

Deep hole LS06-68 was stopped in mid September when highly fractured rock was encountered at 267.3 metres depth. Cantech has hired Cyr Drilling of West Saint Paul, Manitoba to complete this hole. A drill is now being mobilized onto the property and drilling should commence within a few days of this release. Once the drill is in position, hole LS06-68 will be continued from its current depth to a target depth of 1100 metres. This hole is being drilled at azimuth 325 degrees and inclination -87 degrees and is targeting a zone of molybdenum mineralization that was encountered in hole LS06-61 and two previous Amax drill holes, LS65-12 and LS65-16 between 500 to 760 metres below surface. There is no drill hole information below 760 metres from surface in the area of these intersections and it is currently not known how much deeper the molybdenum mineralization extends to. If hole LS06-68 goes to its target depth it will test the deposit to a depth of approximately 1100 metres below surface. It is anticipated that it will take approximately 3 weeks to reach this depth.

Updated Resource Calculation

The objective of Cantech's Phase 3 Drill Program was to better define the grade and width of the Lucky Ship deposit at depths greater than 100 metres below surface particularly along the north side of the deposit and to conduct exploration drilling in the eastern part of the deposit, which recent computer modeling shows to be open. Previous resource calculations by Dr. N.C. Carter placed that part of the deposit below 100 metres from surface in the Inferred category due to lack of drill hole information. The recently completed drill program has better defined the grade and extent of the deposit at depth and this information will be used to prepare a revised resource calculation. Cantech now has all the assay results from the Phase 3 Drill Program and will compile this data on sections in support of completion of a revised resource estimate to be done by Dr. Carter.

The previous resource calculation was set out in Dr. Carter's June 9, 2006 National Instrument 43-101 Report which was filed in on June 16, 2006. Dr. Carter summarized the resource calculation as follows (see page 2 of his Technical Report):

"Current mineral resource estimates are based on the results of more than 4935 metres of diamond drilling in 28 holes completed by New Cantech Ventures Inc. in 2005 and 2006 and in part on results obtained from more than 10000 metres of diamond drilling (23 holes) undertaken by Amax Exploration Inc. between 1964 and 1968. Estimates of Indicated and Inferred Mineral Resources at cutoff grades of 0.030% and 0.060% Mo (molybdenum) are summarized in the following table.

Indicated Mineral Resource Inferred Mineral Resource
Cutoff Tonnes Mo Tonnes Mo
Grade (millions) (%) (millions) (%)
0.030% Mo 19.4 0.076 33.9 0.069
0.060% Mo 12.7 0.089 19.4 0.088

The Indicated Mineral Resources were defined by 2005 and 2006 drilling which consisted of several inclined holes on each of nine sections spaced 50 metres apart. These holes were designed to test the annular mineral zone at depths of between 50 and 100 metres below surface. 1960s Amax drilling tested the mineralized zone at greater depths and results of this drilling assisted in defining Inferred Mineral Resources which are directly below the indicated resources and have been projected to vertical depths of between 50 and 350 metres below surface. This mineralized zone remains open to depth."

MOU with SK Not Proceeding

The non binding Memorandum of Understanding with SK Networks Co., Ltd. announced on September 28, 2006 will not be proceeding.

Qualified Person

Dr. Donald G. MacIntyre, P.Eng., a qualified person under National Instrument 43-101, has been supervising Cantech's 2006 Phase 3 Drill Program and has reviewed and approved the above technical disclosure in this news release.


Dalton DuPasquier


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