Westridge Resources Inc.
TSX VENTURE : WST

May 19, 2011 12:48 ET

Westridge Signs Letter of Intent to Option Charay Project

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 19, 2011) -Westridge Resources Inc.(TSX VENTURE:WST) (the "Company") is pleased to announce that it has entered into a letter of intent with Musgrove Minerals Corp. ("Musgrove") (TSX VENTURE:MGS) whereby the Company has been granted an option to acquire an 80% interest in and to certain mineral concessions in the United Mexican States known as the Charay Project (the "Charay Project").

The Option

Under the terms of the letter of intent, the Company has the exclusive right and option (the "Option") to earn an 80% interest in the Charay Project by: (i) paying to Musgrove an aggregate of $708,000, with $258,000 payable upon the date that the TSX Venture Exchange approves a definitive agreement with respect to the Option (the "Effective Date"), with $225,000 payable on or before the date which is 12 months from the Effective Date, and with $225,000 payable on or before the date which is 24 months from the Effective Date; and (ii) issuing to Musgrove an aggregate of 1,200,000 common shares in the capital of the Company, with 400,000 shares to be issued on the Effective Date, 400,000 common shares to be issued within 12 months of the Effective Date and 400,000 common shares to be issued within 24 months of the Effective Date.

After earning this 80% interest in the Charay Project, Musgrove's 20% interest will be carried to the earlier of commercial production, or the exercise by the Company of an option to acquire the remaining 20% interest. The Company will have the right at any time up to 60 months from the Effective Date, to purchase the remaining 20% interest from Musgrove for a single $5,000,000 lump sum payment.

Under the terms of the letter of intent, the Company has also agreed to complete a work program of not less than USD$500,000 before December 31, 2011, and to assume all property payments to September 1, 2013. The Company retains the right to terminate the Option on 30 days notice at any time following completion of the USD$500,000 work program. At all times, the Company will be the operator for all exploration and development activities on the Charay Project.

The Charay Project

The Charay property (pronounced "cha-rye"), also known as "La Mina El Padre", is comprised of three mineral concessions covering approximately 11,000 hectares, and is located at the north end of the State of Sinaloa, Mexico, approximately 36 km northeast of the city of Los Mochis.

The qualified person for the Charay Project, Phil Van Angeren, P.Geol, has prepared a 43-101 compliant report for Musgrove.

Geologically, the Charay property is classified as a low sulphidation, epithermal, gold-silver quartz vein with low base metal content. The pertinent points regarding this property are as follows:

  • High-grade, near-vertical, epithermal gold/silver vein system within an andesitic volcanic complex (El Padre vein): oxidized, hematitic, low-sulphide, banded quartz-vein and silicified breccia with a prominent silica cap (typical low-sulphidation epithermal features),
  • Vein width in the order of 1.0 to 2.0m; length in excess of 400m, extending to 50m depths, and open in all directions (indicated by drilling),
  • Existence of several mineralized and/or silicified structures indicated by workings and geology,
  • Potential for buried bonanza mineralization (indicated by drilling) as well as additional mineralization on strike,
  • Little or no comprehensive historical exploration. Surprisingly under-explored given the high gold grades. No workings reach deeper than 35m, no drill intercepts below ~50m depths,
  • A 27-hole drill program in 2005 intersected a 250 m long mineralized section within 50m of surface on the El Padre vein, at a weighted average of 18.75 gm/T Au and 120.2 gm/T Ag over a true width of 1.14m, recalculated in 2010 at 20.3 gm/T Au and 123.7 gm/T Ag across 1.29m, and
  • Location in an area with established mining logistics (eg, access to local mills, mining expertise, railway, powerline, and tidewater port).

Completion of the Option is subject to conditions

The completion of the Option is subject to a number of conditions, including but not limited to the execution of a definitive agreement, satisfactory due diligence, the approval of the definitive agreement by the Board of Directors of the Company and the approval by the TSX Venture Exchange. There can be no assurance that the Option will be completed as proposed or at all.

About Westridge Resources

Westridge Resources Inc. is a Canadian-based mineral exploration company focused on the acquisition, evaluation and exploration of mineral resource properties. To date, the Company has focused its exploration activities in the Province of British Columbia, with its primary property being the Fortuna Property located in the Mount Sicker area of southeastern Vancouver Island, B.C. Detailed geological mapping has been carried on the Northeast Copper Zone and Jane Prospect areas of the Fortuna Property and preparation for a diamond drilling program in the Northeast Copper Zone has been initiated.

ON BEHALF OF THE BOARD

"Chris Cooper"
President, Chief Executive Officer and a Director

Certain information regarding the Company including management's assessment of future plans and operations may constitute forward-looking statements under applicable securities laws. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements.

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

Contact Information

  • Westridge Resources Inc.
    Ron Cooper
    Investor Relations
    877-692-8288