TORONTO, Dec. 21 /PRNewswire-FirstCall/ - Gran Colombia
Gold Corp. (TSX-V:GCM) is pleased to announce that it has signed an
option agreement with Minatura International LLC and various
affiliated companies (collectively, "Minatura") providing
for an option to purchase 65% of Minatura's mining properties and
processing assets in the Segovia/Remedios area of Antioquia,
Colombia, which are within the
same geological structure of the Gran Colombia Mines (formerly
known as the Frontino Mines).
Maria Consuelo
Araujo, Chief Executive Officer stated: "We are pleased with
this opportunistic acquisition which allows Gran Colombia Gold to
further amalgamate properties in this area. The option
agreement provides us with exploration rights to the areas north of
our Remedios properties and south of our Gran Colombia properties
(the area formerly known as the Frontino property), where we plan
to prove continuity of the high-grade gold mineralized systems. The
investment provides us with ready and permitted processing capacity
for the ore from our Remedios properties, our Gran Colombia Mines
and small miners in the area. While our main priority in 2011
remains to increase production at our Gran Colombia Mines and
continue exploration at our other properties, this acquisition is a
perfect fit for our development strategy within the
Remedios/Segovia mining district."
The option includes: (i) six existing
mining concessions for a total acreage in excess of 662 hectares,
including the existing San Pablo Mine and the La Bartola Mine; (ii)
24,300 hectares of applications for concessions in the same area;
and (iii) existing permitted processing facilities of approximately
50 tonnes per day ("tpd") capacity (collectively, the
"Assets").
Under the terms of the option agreement,
Remedios Gold, S.A.
("Remedios"), a wholly owned subsidiary of the Company, paid
US$300,000 for a 90 day due diligence
term, which was paid with cash on hand. If the option is
exercised, Remedios will pay Minatura an additional US$7,700,000 for a 65% interest in the Assets and
will commit to: (i) a US$7,000,000 investment plan over two years,
which is designed to explore and evaluate geological resources with
the objective of developing an initial National Instrument 43-101
compliant technical report, and to upgrade and develop the San
Pablo Mine to bring it into production; and (ii) upgrade the
existing processing plant at the San Pablo Mine to at least 250 tpd
capacity, for an estimated investment of US$3,500,000.
The option agreement also includes a put/call
option between the parties for Minatura's remaining 35% of the
Assets for a period of three years from the closing date, for a
price equivalent the greater of: (i) US$10 million; and (ii) such percentage of the
measured and indicated resources at a value of US$60/oz Au and of inferred resources at a value
of US$20/oz Au, as per the initial
National Instrument 43-101 compliant report.
To view Map 1 please visit:
http://files.newswire.ca/920/grancolombiamap1.pdf
About Gran Colombia Gold Corp.:
Gran Colombia Gold is a Canadian-based gold
and silver exploration and development company focused on
acquiring, developing and operating properties of merit in
Colombia. The Company holds 95% of
the former Frontino gold and silver assets, including the largest
underground gold and silver mining operation in Colombia. It also owns four more exploration
projects in Colombia for total
exploration acreage of approximately 21,400 hectares. The Company
is committed to implementing its exploration and development
strategy with a comprehensive environment, safety and community
program, meeting international standards of best practice.
Additional information on the Gran Colombia
Gold can be found on the Company's website at
www.grancolombiagold.com and by reviewing the Company's
profile on SEDAR at
www.sedar.com.
Forward Looking Information:
This news release contains "forward-looking
information", which may include, but is not limited to, statements
with respect to the future financial or operating performance of
the Company and its projects. Often, but not always,
forward-looking statements can be identified by the use of words
such as "plans", "expects", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates", or believes" or
variations (including negative variations) of such words and
phrases, or state that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Gran Colombia to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements.
Forward-looking statements contained herein are made as of the date
of this press release and Gran Colombia disclaim, other than as
required by law, any obligation to update any forward-looking
statements whether as a result of new information, results, future
events, circumstances, or if management's estimates or opinions
should change, or otherwise. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, the reader is
cautioned not to place undue reliance on forward-looking
statements.
Neither 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.
SOURCE Gran Colombia Gold Corp.
Copyright . 21 PR Newswire
