METALS CREEK RESOURCES CORP. COMPLETES LETTER OF INTENT TO OPTION OGDEN TWP. PROPERTY FROM GOLDCORP CANADA LTD.
Toronto, May ●, 2008. Metals Creek Resources Corp. (the “Corporation”, TSXV: MEK) is pleased to announce it has signed a non binding letter of intent (the “LOI”) with Goldcorp Canada Ltd. (“Goldcorp”) to jointly explore Goldcorp’s mining claims located in Ogden and Deloro Townships, located six km south of Timmins city centre, Ontario. The package consists of 84 patented and unpatented claims totaling approximately 1184 hectares (the “Property”) and covers eight kilometers of strike length along the east-west striking, highly prospective, Porcupine-Destor “Break”. The Dome Mine complex and five large past producers are located between three and eight kilometers to the east of the Property along the gold trend. Past production of these mines include: the Delnite (920,000 oz), Aunor (2,502,000 oz), Buffalo-Ankerite (957,000 oz), Paymaster (1,192,000 oz), and Preston (1,539,000 oz). Goldcorp’s current operation at the Dome Mine Complex is located 8 km from the Property, and has produced in excess of 16 million oz of gold to date. (Source: Government of Ontario, MNDM, Gold Production in the Timmins Regional Resident Geologist’s District to the end of 2006). Recent discoveries in the district include Lake Shore Gold’s Timmins West project, located 10 km to the west of the Property, along the same gold trend. This project is the focus of shaft sinking and underground development to access an Indicated Mineral Resource of 1,291,000 oz (Source: NR, TSX:LSG, Nov. 20,2006).
Please click here to view compilation map of Timmins Area.
Within the Property, the Porcupine-Destor Break is represented as a sheared and altered contact between ultramafic and mafic volcanics. A discontinuous Timiskaming-aged conglomerate and a variety of felsic porphyries are found proximal to the Break and carbonate and sericite alteration is widespread. The Property hosts the past producing Naybob Mine, which had historic gold production of 50,731 oz (source: Government of Ontario, MNDM, Gold Production in the Timmins Regional Resident Geologist’s District to the end of 2006). Drilling in the past has been wide spaced and shallow with most of the drilling concentrated near the Naybob Mine and a cluster of shallow holes in the Thomas Ogden Zone, located 4 km to the west. Prior to 2000, claim ownership and gold exploration was disjointed and the Property had been comprised of at least six separate packages. Since then, the properties have been combined and a more systematic exploration approach has been made possible. Goldcorp has recently completed several limited drill programs and a number of surveys including: a detailed high resolution magnetic survey, IP surveying, an airborne gravity survey and a variety of geological compilations on the Property. Drilling will be initiated once a formal agreement has been finalized and the various gold targets prioritized.
The agreement allows for the Corporation to earn 50% of Goldcorp’s interest in the Property by funding total expenditures on the Property of $3,100,000 over four years as follows: (i) $400,000 in year one, (ii) $700,000 in year two and (iii) $1,000,000 in each of years three and four. The Corporation will also make cash and share payments to Goldcorp as follows: (i) $40,000 cash and $25,000 worth of common shares on signing, (ii) $35,000 cash and $25,000 worth of common shares on the first anniversary, (iii) $35,000 cash and $50,000 worth of common shares on the second anniversary, (iv) $100,000 worth of common shares on the third anniversary, and (v) $150,000 worth of common shares on the fourth anniversary (the issuance price of all common shares shall be in accordance with the policies of the TSX Venture Exchange). Within six months of the Corporation’s vesting at 50% interest in the Property, Goldcorp has the option to buy back a 20% interest from the Corporation for a cash payment of up to $310,000, expending $4,100,000 on the property within two years, and completing a feasibility study within three years. The Corporation will be the operator of the Property during the earn-in period and afterwards, provided it holds a 50% or greater interest in the Property. If either party becomes diluted to a 10% interest, that interest will be converted into a 2% Net Smelter Return Royalty.
Management of the Corporation feels this LOI will form the basis for a promising strategic acquisition. Alexander (Sandy) Stares, CEO of the Corporation, stated, “This property represents a potentially high quality gold project opportunity for Metals Creek, located within the prolific Timmins Gold Camp near several multi-million ounce producers along the Porcupine-Destor Break. We are excited to be partnering with a world class gold miner in Goldcorp.”
About Metals Creek Resources Corp.
Metals Creek Resources Corp. is incorporated under the laws of the Province of Ontario, is a reporting issuer in Alberta, British Columbia and Ontario, and has its common shares listed for trading on the Exchange under the symbol “MEK”. The Corporation is engaged in the identification, acquisition, exploration and development of mineral resource properties, and presently has mining interests in Ontario and Newfoundland and Labrador. Additional information concerning the Corporation is contained in documents filed by the Corporation with securities regulators, available under the company’s profile at www.sedar.com.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Alexander Stares, President and CEO
telephone: (709)-256-6060
fax: (709)-256-6061
email: astares@metalscreek.com
Toronto, Ontario: Metals Creek Resources Corp.