RX Exploration Inc.

November 06, 2009 16:58 ET

RX Exploration Completes $2 Million Private Placement and Files Current NI 43-101 Technical Report

TORONTO, ONTARIO--(Marketwire - Nov. 6, 2009) - RX Exploration Inc. (the "Company") (CNSX:RXE) is pleased to announce that it has completed private placements totaling 10,259,000 units at $0.20 per unit for gross proceeds of $2,051,800. Each unit consisted of one common share and one share purchase warrant. Each warrant entitles the holder to purchase one additional common share for two years at $0.40 per share. The expiry date shall be accelerated to thirty days from the tenth consecutive trading day on which the common shares of the Company close at or above $0.60. The securities issued are subject to a four month hold period.

With respect to part of the offering, finder's fees in the amount of $135,072 (9%) were paid and 750,400 (10%) broker's warrants were issued. The broker's warrants are exercisable at $0.20 per share for a two year period. The net proceeds of $1,916,728 will be used primarily for exploration and development on the Company's principal property, the Drumlummon Mine in Montana, general administrative expenses, and working capital.

The Company has completed a new technical report dated September 25, 2009, prepared by Dr. Richard C. Capps, PhD, of Evans, Georgia, a "qualified person" within the meaning of National Instrument 43-101. The recommended exploration year 2009-2010 budget is $908,050 which includes a first-stage budget of $228,800 to dewater and a second-stage budget of $679,250 to continue exploration on lower levels of the mine.

Dr Capps noted that the Drumlummon Mine "is an existing multilevel underground mine developed within six historic high-grade, gold-silver, bonanza-style, fissure- vein systems to over 1,600 feet in depth and over 3,000 feet along strike. Full scale mining terminated over 100 years ago due to apex rights litigation and the mine was subsequently flooded to the 400-foot level. RX Exploration, Inc. began exploration drilling to evaluate continuity of geology and mineralization within the Drumlummon Mine property in 2008 and completed 2008-2009 Phase 2 advanced exploration drilling from the 400-foot level in 2009."

Dr. Capps concluded that "since November 2008, RX Exploration has conducted an extensive underground and surface Phase 2 drilling program that demonstrates vein continuity on the Christmas and Drumlummon/Castletown vein systems and continues to collect assay data in the "D block" as defined by Beesley (2008b). Underground construction between 1 November 2008 and 1 August 2009 provides safe and stable underground drilling platforms on the 400-foot mine level and establishes an infrastructure for continued exploration. Drilling continues to show geologic continuity and significant silver and gold assays intercepts."

Dr. Capps went on to state that "detailed logging of recent drill core provides strong textural and mineralogical evidence of repeated hydrothermal events and telescoping of zones of alteration and mineralization over wide vertical and horizontal ranges in the veins of the Drumlummon Mine. Repeated telescoping of mineralizing hydrothermal systems have produced stacked ore bodies in similar districts and suggests the exploration potential for deeper and more extensive mineralization in some veins of the Drumlummon Mine."

Dr Capps recommended that "diamond and percussion drilling should continue as an effective measure of geological continuity, but studies in other similar mines (Dominey and others, 2000) have shown that grade distribution can only be reliably determined in high-grade fissure-vein type deposits by bulk sampling, close-spaced sampling, and trial mining. These techniques are recommended for determining grade distribution at the Drumlummon Mine Project."

Permission to dewater the mine has been granted to the Company by the Montana Department of Environmental Quality and initial preparations to dewater are complete. Installation of the water treatment facility is scheduled to begin next week.

The full report is being filed with this press release on the Company's information on SEDAR at www.sedar.com and on the CNSX website at www.cnsx.ca.

RX Exploration Inc. is a reporting issuer in good standing in the Province of Ontario whose shares are listed on CNSX (Symbol: RXE). There are currently 82,781,578 common shares issued and outstanding following completion of the private placements.

Forward Looking Statements: Statements made in this news release that relate to future plans, expectations, events or performances are forward looking statements. Such 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.

CNSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • RX Exploration Inc.
    John F. O'Donnell
    Chairman of the Board
    (416) 862-7330
    RX Exploration Inc.
    Murray R. Nye
    (204) 989-2434