Westcore Energy Ltd.

December 12, 2008 15:24 ET

Westcore Announces Lift of Trading Halt and Filing of Technical Report

CALGARY, ALBERTA--(Marketwire - Dec. 12, 2008) - WESTCORE ENERGY LTD. (the "Corporation" or "Westcore") (TSX VENTURE:WTR.P), a capital pool company, is pleased to announce that the trading halt that has been in place since it announced its proposed non-arm's length Qualifying Transaction on August 21, 2008, will be lifted at the opening of markets on December 16, 2008. The Corporation also announces that it has received a final technical report prepared in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects, entitled, "Technical Report, Coal Properties - North 54 degrees, West 102 degrees, NTS 63 F4 and 63 F/5, Santon River and Rat Creek Areas Near Hudson Bay, Saskatchewan - December 1, 2008 for Westcore Energy Ltd." The technical report was prepared by MineTech International Limited of Halifax, Nova Scotia. The author of the report is Patrick J. Hannon, M.A.Sc., P.Eng., who will serve as the Corporation's Qualified Person in respect of the properties that are the subject of the report. A brief summary of the report follows:

Report Summary

Westcore has entered into a binding letter agreement dated August 20, 2008 with several private parties regarding the acquisition of all rights, title and interests held by such parties in certain Saskatchewan coal permits and certain Crown coal rights in the Province of Manitoba (such properties are collectively referred to as the "Assets"). The Assets are adjacent to the claim block hosting the coal discovery previously announced by Goldsource Mines Inc. ("Goldsource") near Hudson Bay, Saskatchewan on the Saskatchewan-Manitoba border. The vendors of the Assets are Ken MacNeill, BEC International Corporation, Lakeco Holdings Ltd. and T&N Holding Inc. (collectively, the "Vendors"). Mr. William MacNeill is the principal shareholder of BEC and Lakeco and Mr. Tom MacNeill is the principal shareholder of T&N.

Work completed on the properties to date includes prospecting, a desktop study of the geological setting, an airborne GEOTEM survey (electromagnetic and magnetic gradients) and the spotting of the first phase and second phase drill holes. Six holes will be drilled in Phase 1 to determine the stratigraphy and down hole geophysical response of the various rock types encountered. Contingent upon positive results in Phase 1, fifty holes will be drilled in Phase 2, at a spacing of 1,500 metres, to follow up Phase 1 work. The hole priority of the Phase 2 drilling will be adjusted based on the results of Phase 1.

Patrick Hannon, M.A.Sc., P.Eng., the Qualified Person and author of the report visited the properties on July 25, 2008. A helicopter tour of the properties was undertaken as it is difficult to travel the area by four-wheel drive.

The properties are in four blocks adjacent to the: Goldsource discovery block: one on the north side, two on the south side of the Goldsource block and the other on the Manitoba side of the border, to the east of the Goldsource discovery. Minetech was unable to verify the information released on the adjacent property and, the information is not necessarily indicative of the mineralization on the properties that Westcore has agreed to acquire.

The properties are at 52 degrees 45' to 53 degrees 30' North Latitude, 102 degrees West Longitude. The land area to be acquired includes 18,880.00 hectares in Manitoba, and 66,795.40 hectares in Saskatchewan for a total area of 85,675.40 hectares. The Saskatchewan Coal Prospecting Permits have been issued and the Manitoba Quarry Exploration Permit was granted October 14, 2008.

The permits were originally staked by Mr. William MacNeill (Saskatchewan Permits) and Mr. Jon. R. MacNeill (Manitoba Permits) on behalf of the Vendors.

Westcore has agreed to issue an aggregate of 8,000,000 common shares in the capital of Westcore to the Vendors at an ascribed price of $0.30 per share and grant the Vendors a gross overriding royalty of $2.00 per tonne of coal produced from the Assets (with no deductions). Upon closing, Westcore will pay the staking costs of $194,000.

Rental for the Saskatchewan Permits will be about $70,000 in year 1, increasing to about $135,000 in years 2 and 3. The work requirements are $40,000 per permit. There are 92 permits in total, and to keep all of the ground beyond three years would require a total expenditure of $3,680,000.

The access to the properties is provided by a network of loose-surfaced all-weather exploration and logging roads, maintained by petroleum and timber companies. These roads ultimately connect to the provincial Highway 55. There is a small airport at Hudson Bay, and airports at Prince Albert, Saskatchewan, about 250 km west-south-west of the properties. Flin Flon, Manitoba is about 170 kilometres due north of the properties. An international airport is at Saskatoon, about 4 hours by road from the properties.

Some of the terrain, especially the Pasquia Hills, is difficult to traverse. All-terrain vehicles and four wheel drive trucks are required for the logging road and off road work. Helicopter transport will be required to reach some areas for geological surveys.

The three main coal-bearing units in southern Saskatchewan are the Tertiary Ravenscrag Formation, the Upper Cretaceous Belly River Formation, and the Lower Cretaceous Mannville Group. Both the Mannville Group and the Belly River Formation in Saskatchewan are successions of sandstones, shales, and coals intercalated with and encased in marine shales.

Coal is formed from peat deposits which were formed in a waterlogged environment where plant debris accumulated. The stages of coalification proceed from peat to lignite, sub-bituminous coal, bituminous coal, anthracite coal, and finally to graphite. The peat to coal ratio is variable but around 7:1 to 10:1 for sub-bituminous coal. The Goldsource discovery at Hudson Bay would have had a peat horizon over 150 metres thick to result in 20 metres of coal. A very long period of low addition of mineral matter would be required to create over 20 metres of coal.

The top of the coal at the site of the Goldsource discovery is reported to be about 80 metres below the surface. The coal horizon subcrop would be about 10 km northeast of the northern block of permits Westcore has agreed to acquire. The overall dip of the rocks is to the southwest at approximately 1 metre per kilometre. Goldsource reported that the discovery coal is black and moderately hard and believed to be from the Mannville/Swan River Group of Cretaceous age. Samples from the first two holes indicates a High volatile bituminous C to Sub-bituminous A coal rank, an average Calorific Values (dry basis) of approximately 21,000 Kj/Kg (9,200 BTU/lb). Sulphur values ranged from 0.25 to 3.84% with an average around 1.5%.

To date, there has been no drilling or sampling of the coal horizon on the properties Westcore has agreed to acquire.

Goldsource reported that according to the standards for reporting coal in Canada, the coal deposit may be Low-Type B geological complexity and may be designated as a "surface" deposit type. Low type B category is based on the Alberta Plains coal seams greater than three metres in thickness.

There are no defined Coal Resources on the properties that Westcore has agreed to acquire. This is a new acquisition and there has been minimal ground exploration. Coal float - cobbles of coal - were found by prospector Wayne Fisher near the northwest corner of the northern block of the Saskatchewan properties that Westcore has agreed to acquire. No bedrock coal has been identified on the properties to this date.

Several companies applied for Coal Prospecting Permits in Saskatchewan and Quarry Exploration (Coal) Permits in Manitoba as a result of the Goldsource discovery. Wescan Goldfields Inc. and Westcore have most of the land adjacent to the Goldsource discovery.

The Westcore properties are well located with respect to the major coal discovery by Goldsource.

A two phase exploration program is recommended, with the second phase work being contingent upon encouraging results in Phase 1. A total of $307,000 is recommended for Phase 1 and about $1.5 million in Phase 2.

Drilling will be the main exploration tool. The Permit area should be fence drilled, with the fences oriented along the dip of the projected coal seam. Holes can initially be widespread to determine the geology, and then closer spaced to build resources. All holes are to be geophysically logged.

Phase 1 includes a wide spaced drill program, with six holes to be drilled in order to determine basic geology. An office should be set up in Hudson Bay, Saskatchewan, staffed with a geological crew. Open hole, rotary drill holes should be used to determine the broad scale stratigraphy, the depth to the coal horizon and the large scale structural geology on the permit ground. During the Phase 1 drilling, the rotary drill holes can be followed up by HQ size diamond drill holes. Hole depth will be 100 metres or less. Holes may be part open hole and part core. All holes to be geophysically logged and chip samples retained. Distance down hole can be reconciled with the geophysically logged distance. Piezometers can be installed so that the hole can provide information on the hydrogeology.

Phase 2 may include surface geophysics (resistivity, shallow seismic) if Phase 1 work suggests a good methodology. Drilling of 50 holes is anticipated, contingent upon success in Phase 1. Phase 2 will follow up the Phase 1 work concentrating on building resources, which will be documented in a new NI43-101 Technical Report at the completion of Phase 2 of the exploration.

Patrick J. Hannon, M.A.Sc., P.Eng., and Qualified Person for this news release has reviewed and approved its contents.

As an update to its news release dated August 21, 2008, Westcore advises that it is currently considering potential candidates to serve as an additional independent director and continues to anticipate that at least one additional independent director will be added prior to closing the Qualifying Transaction. Once a suitable candidate is identified and such individual agrees to serve, a further announcement will be made.

Forward Looking Statements

Except for statements of historical fact relating to the Corporation, certain information contained herein may constitute forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Except as required by applicable securities requirements, the Corporation undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Westcore Energy Ltd.
    Paul Conroy, President, Chief Executive Officer,
    Chief Financial Officer and Corporate Secretary
    (403) 697-4005
    (403) 263-0271 (FAX)