Valterra Resource Corporation

Valterra Resource Corporation

October 23, 2006 13:23 ET

Valterra Wines Ltd. Name Changed and Corporate Update

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Oct. 23, 2006) - Valterra Resource Corporation (the "Company") reported today further details of its reorganization as previously reported in news release dated July 5, 2005 (NR 01-05).

Name Change

Effective April 20, 2005 the company changed its name to Valterra Resource Corporation to reflect its entry into the mineral resource sector following cessation of its business of wine production and sales through its wholly owned subsidiary, Hester Creek Estate Winery Ltd.

Board Composition

Effective June 1, 2006 the company expanded its Board of Directors with the appointment of the following persons, all of whom have significant experience as noted:

Lawrence Page, Q.C. - Mr. Page has served in the past (March 2003 - June 2005) as a Director and President of the company and currently serves as President and Chief Executive Officer. Mr. Page is also the principal of Manex Resource Group Inc. which provides administrative services to public companies in the mineral resource sector including Valterra. He currently is a Director of a number of reporting issuers on the TSX.-Venture Exchange, including Quaterra Resources Inc., Bravo Venture Group; Southern Silver Exploration Corp. and Fortune River Resource Corp. He is the founder of Saturna Beach Estates Ltd. which owns and operates a 78 acre vineyard and winery on Saturna Island, British Columbia.

Edward A. Odishaw LLB, - Mr. Odishaw commenced the practice of Law in 1968 following his tenure as Executive Assistant to the Premier of Saskatchewan and Provincial Cabinet Secretary. He serves on the Board of a number of private and public companies including United States Lime and Minerals Inc. (USLM listed on NASDAQ) and Austpro Energy Corporation. He is a Director and Chairman of Estey Centre for Law and Economics in International Trade. He served on the Board of Directors of the company from November 2003 to June 2005.

Robert E. Swenarchuk - Mr. Swenarchuk serves as a director of several mineral exploration companies including Fortune River Resource Corp., Bravo Venture Group; Southern Silver Exploration Corp. He has more than 25 years of successful practice in the corporate and investor relations sectors of the natural resource industry. He is President of Rescom Consultants Ltd., which he founded in 1980 to provide a range of financial and investor services to public companies. Over the past 16 years he has been involved in arranging financing for mineral exploration and development projects in Canada, the United States, Mexico, Russia, Kazakhstan and China. He has extensive financial community contacts throughout North America, Europe and Asia.

Messrs. Page, Odishaw and Swenarchuk join incumbent Director, Barry Schindel on the Board of Directors of the company.

Debt Settlement

Subject to proposed partial revocation of outstanding Cease Trade Orders made by the British Columbia and Alberta Securities Commissions against the Company respectively (the "CTOs"), Valterra has agreed to settle an aggregate $1,523,695 of debt with its significant creditors by the issuance of an aggregate 6,084,780 shares at a deemed value of $.25 per share.

Debt Guarantee Bonus

In 2004, the company borrowed $200,000 from HSBC, the repayment of such debt being guaranteed by Semper Investments Limited. As consideration for the grant of such guarantee which remains outstanding, the company has agreed subject to partial revocation of the CTOs to issue 200,000 shares to Semper Investments Limited at a deemed value of $0.25 per share.

Property Option

By agreement dated March 27, 2006, the company has acquired an option to purchase the Swift-Katie group of mineral claims for consideration as set out below:

To earn 60% interest in the Swift-Katie claims, Valterra must make the following cash payments and, subject to revocation, in whole or in part, of the CTOs, share issuances, and incur the following exploration work expenditures:

Date Cash Work Shares Vesting
Signing $ 12,500 - - 0%
Upon approval of
agreement by a
recognized Stock
- - 55,000 0%
Dec. 31, 2006 $ 12,500 $ 50,000 55,000 0%
Dec. 31, 2007 $ 25,000 $100,000 110,000 0%
Dec. 31, 2008 $ 35,000 $200,000 110,000 0%
Dec. 31, 2009 $ 35,000 $250,000 110,000 60%
Totals $120,000 $600,000 440,000 60%

And to earn the remaining 40% interest in the Swift-Katie Claims, Valterra must make the following cash payments and share issuance, and incur the following exploration work expenditures:

Date Cash Work Shares Vesting
Dec. 31, 2010 $ 60,000 $350,000 225,000 60%
Dec. 31, 2011 $ 60,000 $350,000 225,000 60%
Totals $120,000 $900,000 550,000 100%

The Swift-Katie property is located 7 kilometers southwest of the town of Salmo, in southeast British Columbia and comprises of 8 mineral tenure claim blocks totaling 5,415.13 hectares. The claims are owned by Gerald G. Carlson (33.75% - held on behalf of KGI3 Management Ltd.), John A. Chapman (33.75%), Doublestar Resources Ltd. (22.50%) and Ken Murray (10,00%).

The company commissioned the preparation of a mineral report dated May 23, 2006 on the Swift-Katie property by David K. Makepeace, P. Eng. of Geospectrum Engineering. A "Qualified Person" under National Instrument 43-101, he reported that the property qualifies as a property of merit based upon a preliminary mineral resource calculation generated to identify the mineral potential of the Swift-Katie deposit.

Based on the report, the mineral resources at a 0.15% Cu cutoff are:

Measured Mineral Resource - 22.0 MT @ 0.26 g/t Au and 0.26% Cu
Indicated Mineral Resource - 48.7 MT @ 0.21 g/t Au and 0.22% Cu

The report recommends a two phase exploration program consisting of an IP survey and magnetometer survey followed by diamond drilling exploration. The IP and Mag surveys are scheduled to be conducted in 4Q 2006 followed by diamond drilling in 2Q 2007.

Private Placement

Subject to partial revocation of the CTOs, the company intends to proceed with a private placement of 3.0 million common shares to be issued at $0.10 per share for a total of $300,000. Intended use of the placement funds is to fund costs associated with the reorganization of the Company and to fund the 2006 exploration program on the Swift-Katie group of mineral claims.

Cease Trade Orders

The shares of the company remain subject to the CTOs made by the British Columbia Securities Commission ("BCSC") and Alberta Securities Commission ("ASC"). The company has made application for a partial revocation of CTOs to allow the issuance of shares to conclude the transactions noted herein. The CTOs were made as a result of the failure by the company to file quarterly and annual financial statements during the time when the company was in the winery business and its wholly owned subsidiary, Hester Creek Estate Winery Ltd., entered bankruptcy.

The company has retained auditors to prepare and deliver audited financial statements which will be filed, together with quarterly statements, with the BCSC and ASC in support of applications for full revocation of the CTOs at which time the company intends to apply to a Canadian stock exchange for listing of its shares.

Rob Macdonald, (P.Geo) is the Qualified Person responsible for reviewing the technical results reported in this release.

On Behalf of the Board of Directors

Lawrence Page, Q.C., President and Director

Valterra Resource Corporation

This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs including drilling, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Although Valterra expects the exploration programs as listed above to move forward, Valterra has no control over how or when exploration takes place, only the contractual minimum amount of expenditures. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

The Securities represented herein for the private placement is not for dissemination in the U.S. and have not been and will not be registered under the United States Securities Act of 1933, as amended,(the "1933 Act") or the securities laws of any State, and may be offered, sold or otherwise transferred only (A) to the Company, (B) outside the United States in accordance with Rule 904 of Regulation S under the 1933 Act and in compliance with applicable State Securities Laws, or (C) with the prior written consent of the Company, pursuant to another exemption from the registration under the 1933 Act and any applicable State Securities laws.

The TSX Venture Exchange neither agrees nor disagrees with the information contained herein.

Contact Information

  • Valterra Resource Corporation
    Lawrence Page
    Q.C., President and Director
    (604) 684-9384
    (604) 688-4670 (FAX)