Strata Minerals Inc.
NEX BOARD : SMP.H
TSX VENTURE : SMP.H

Strata Minerals Inc.

June 26, 2017 19:30 ET

Strata Minerals Announces Property Consolidation and Financing Update

TORONTO, ONTARIO--(Marketwired - June 26, 2017) -

NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Strata Minerals Inc. (NEX:SMP.H) ("Strata Minerals" or, the "Company") wishes to provide the following update on the proposed consolidation of interests in mining claims comprising approximately 2,000 acres located in Lemhi County, Idaho (the "Acquisitions") announced on June 5, 2017 and known as the Arnett Creek Gold Project ("Arnett Creek" or, the "Project").

Strata Minerals has now substantially concluded its due diligence and final documentation on the Acquisitions and will, subject to regulatory approval, proceed with three of the originally proposed four individual purchase agreements. The Company will issue a total of 5,750,000 common shares and pay initial cash consideration of approximately $302,500 to acquire the Project.

Based on assessments to-date, the Company will focus its initial exploration efforts at Arnett Creek on a target known as the Little Chief Extension. The Little Chief Extension is reported to be open at depth and faulted off to the north with the faulted extension representing an obvious exploration target.

A summary of the Acquisitions is provided in the table below:

Arnett Creek Acquisition Agreements
Claims Acres Initial
Payment at Close/Effective Date
1st Year 2nd Year 3rd Year 4th Year NSR Royalty Residual
Interest C$ Shares US$ US$ US$ US$ Royalty Buy-Back
US$
Buyout
Option
US$
Otis Gold Corp.1 16 331 100% $ 100,000 2,750,000 0 0 0 0 1.0% $2 MM n/a
Bull Run Capital Inc.1 68 1,405 75% - 3,000,000 0 0 0 0 1.0% $2 MM $500,000
Private Individuals2 11 220 100% $ 202,500 0 $ 150,000 $ 150,000 $ 250,000 $ 250,000 2.0% $2 MM n/a
95 1,956 $ 302,500 5,750,000 $ 150,000 $ 150,000 $ 250,000 $ 250,000

Notes: (1) purchase agreement; (2) option agreement.

Arnett Creek is an advanced stage exploration project which, together with a number of other contiguous claims, was the subject of three historic geologic resource estimates prepared by Pincock, Allan & Holt ("PAH") in 1991, 1993 and 1994 (the "PAH Reports"). The Project is situated approximately four miles from the Beartrack open pit heap leach mine which was operated by Meridian Gold Inc. ("Meridian") from 1994 until 2000 and produced approximately 600,000 ounces of gold. The Beartrack mine closed at a time of low gold prices, below US$400 per ounce.

The most recent historic geological resource estimate encompassing Arnett Creek, titled the "PAH 1994 Update of Arnett Creek Conceptual Study" (the "PAH 1994 Update"), reported a historical indicated geologic resource of 12,042,000 tons at 0.027 ounces of gold per ton containing 327,300 ounces of gold and a historical inferred geologic resource of 2,864,000 tons at 0.018 ounces of gold per ton containing 53,000 ounces of gold. Based on reasonable assumptions derived from available reports, the Company estimates that approximately half the historic resource and four of the five mineralized areas included in the PAH 1994 Update are located within Arnett Creek. There are no more recent estimates or data available to the Company.

The PAH 1994 Update utilized a rock-type model. Compositing of assay data was done on ten foot lengths, and high-grade outlier composite grades were capped by rock type. PAH ran geological resources for both the capped and uncapped model and found there to be negligible difference in total ounces between the two models.

Using omni-directional and vertical variograms constructed within the main mineralized zones, PAH selected a search radius of 110 feet in plan and 150 feet vertically. A minimum of three composites were required for a block to be estimated by ordinary kriging. In order for a resource to be classified as indicated, at least one composite had to be within 80 feet of the estimated block or within a mineralized zone. Blocks outside a mineralized zone, and further than 80 feet from a composite, were classified as inferred. These classifications conform to those set out in NI 43-101, 1.2 and 1.3.

Strata Minerals notes that the PAH 1994 Update was based on reverse-circulation drilling conducted by American Gold Resources Inc. ("AGR"). Subsequent geological work conducted by Meridian in 1997 consisted of eleven diamond drill holes, three of which were twins of previous reverse-circulation holes. While these twin holes confirm the presence of gold from earlier drilling, they also demonstrate the high variability of gold grades over the short distances between twined holes and suggest that the results from reverse-circulation drilling below the water table may not always be reliable.

Strata Minerals believes that the historic drilling and the PAH 1994 Update support the existence of a significant mineralized system. However, any future resource estimates by Strata Minerals will be based on a larger component of core drilling and will use specific gravity measured from drill core samples.

In early 1998, Meridian submitted a two‐year proposal to the U.S. Forest Service for exploration at Arnett Creek and area. However, in mid-1998, Meridian terminated its involvement in the project, returning the claims to their original owners. No major exploration activities have been recorded since.

Strata Minerals cautions that the PAH Reports were prepared prior to the implementation of NI 43-101. Accordingly, the PAH 1994 Update does not constitute a mineral resource or a mineral reserve as defined by NI 43-101. The Project will require considerable further evaluation in order to verify the PAH 1994 Update. As of the date of this news release, a qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves and Strata is not treating the historical estimate as a current mineral resource or mineral reserve.

Financing Update

In connection with the Acquisitions, Strata Minerals announced its intention to undertake a non- brokered private placement of up to 6,000,000 units (each a "Unit") at a price of 30 cents per Unit for gross proceeds of $1,800,000 (the "Private Placement"). Each Unit will consist of one common share ("Common Share") and one half of one share purchase warrant (a "Warrant"). Each whole warrant will entitle the holder to acquire one Common Share for $0.45 for a period of two years. The private placement is subject to regulatory approval.

Proceeds from the financing will be used to help fund the Acquisitions and the preliminary Arnett Creek exploration program including data compilation, permitting and approximately 6,000 feet of core hole drilling.

The financing has been approved by the TSX Venture Exchange. The Company expects to close the Private Placement and Acquisitions by June 30, 2017. Regulatory approval includes an application by Strata Minerals to move the listing of the Company's common shares from NEX to Tier 2 of the TSX Venture Exchange.

Technical information in the press release has been reviewed and approved by Steven T. Priesmeyer, C.P.G., a consultant to the Company and a Qualified Person under National Instrument 43-101.

About Strata Minerals Inc.

Strata Minerals Inc. is a growth focused gold exploration and development company. The Company has entered into agreements to acquire the Arnett Creek Gold Project located in Lemhi County, Idaho. The agreements are subject to regulatory approval.

In addition to its interests in Arnett Creek, Strata Minerals is pursuing other gold exploration and development opportunities and holds a 51% interest in the Diamond Mountain phosphate project located in the State of Utah. Additional disclosure of the Company's financial statements, technical reports, material change reports, news releases and other information can be obtained on SEDAR at www.sedar.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

For further information, please visit www.revival-gold.com.

Cautionary Statement

This News Release includes certain "forward-looking statements". These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management's expectations. Forward- looking statements include estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, the ability to complete the acquisition of the Arnett Creek Gold Project, the relevance and reliability of the resource estimates in the PAH Reports, results of exploration, project development, reclamation and capital costs of the Company's mineral properties, and the Company's financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as: the inability to complete the acquisition of the Arnett Creek Gold Project on the terms as announced or at all; the resource estimates in the PAH Reports may not be accurate, valid or complete; changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the activities of the Company; and other matters discussed in this news release. This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. The Company does not undertake to update any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.

Contact Information

  • Andrea Totino
    (416) 366-4100