News ReleaseAzure Resources to option Seruyung interest
Azure Resources Corp (TSX-V:AZR)
Shares Issued 31,619,895
Last Close 6/1/2005 $0.05
Tuesday June 07 2005 - News Release
Mr. Adrian Rollke reports
SERUYUNG OPTION AGREEMENT
Azure Resources Corp. has entered into an option agreement to acquire a 90-per-cent interest in the Seruyung property located in East Kalimantan, Indonesia, from P.T. Sago Prima Pratama (Pratama), owned by Emmy Lasminisyah & Lies Nun Heriyatisyah of Indonesia. Under the terms of the option, Azure has to make a $20,000 payment for which Azure will be given a 90-day period from the date of such payment to conduct due diligence in respect of the project. In the event Azure wishes to acquire a 90-per-cent interest in the project, Azure must, within 90 days of the payment date, make an additional $30,000 cash payment and issue 14 million shares in its capital stock. In addition, six months after the payment date, the company must make an additional $50,000 payment to Pratama.
In order to retain a 90-per-cent interest in the project, Azure will be obliged to complete a positive feasibility study within five years, make an additional payment of $100,000 and issue an additional seven million shares to Pratama. In addition, Azure will be obliged to, within three years of the completion of the feasibility study, commence commercial production at the project, make an additional payment of $100,000 and issue an additional seven million shares.
Azure may acquire Pratama's 10-per-cent carried interest for $1-million at any time prior to the commencement of commercial production. Pratama will retain a 1-per-cent net smelter return royalty in respect of all gold production in excess of 500,000 ounces.
Azure will be seeking shareholder approval for this transaction, as well as for a share consolidation of 1:3.5, at the annual general meeting to be held July 8, 2005. In the event Azure shareholders approve the share consolidation, all shares issued to Pratama would be consolidated on the prescribed basis.
The Seruyung prospect contains high-sulphidation, epithermal-style mineralization. Previous work on the property was undertaken by P.T. Frontier Asian Resources Indonesia between 1997 and 2000. Frontier was previously a subsidiary of Ivanhoe Mines Ltd. The project area lies outside of any protected forest and has relatively good access.
During 1999, 41 drill holes for a total of 7,863 metres were completed by Frontier. Significant mineralization was intercepted in a number of drill holes, which include the following. Interpretation of available data indicates the vast majority of intercepts represent true widths of mineralization.
SE001: 73.45 metres at 3.07 grams per tonne Au, including 18.7 metres at 6.29 grams per tonne Au and 7.3 metres at 4.19 grams per tonne Au;
SE002: 93.03 metres at 1.15 grams per tonne Au, including 5.3 metres at 4.18 grams per tonne Au and 5.4 metres at 4.16 grams per tonne Au;
SE003: 75.1 metres at 1.25 grams per tonne Au, including 21.2 metres at 2.05 grams per tonne Au;
SE006: 106.9 metres at 1.5 grams per tonne Au, including 24.05 metres at 3.73 grams per tonne Au;
SE008: 26.65 metres at 2.64 grams per tonne Au;
SE010: 19.4 metres at 1.1 grams per tonne Au;
SE013: 37 metres at 3.21 grams per tonne Au, including 21.62 metres at 3.94 grams per tonne Au;
SE033: 22.95 metres at 1.53 grams per tonne Au; and
SE035: 60.27 metres at 1.04 grams per tonne Au, including 11.6 metres at 2.41 grams per tonne Au.
Results of the initial drill program indicate significant gold mineralization occurs in silicic and advanced, argillic-altered andesitic volcanics and breccia, which outcrop on G.Seruyung. Three distinct mineralized zones measuring up to 250 metres by 100 metres have been outlined by the previous work, two of which may be continuous.
In house studies undertaken by Frontier estimated a resource at 332,000 ounces of gold, with a total of 6.3 million tonnes at 1.63 grams per tonne Au, as reported by Ivanhoe Mines in news in Stockwatch on March 13, 2000. Azure has not undertaken work necessary to verify the classification of this resource, nor is Azure treating the results as a National Instrument 43-101 defined resource. Accordingly, the estimate should not be relied upon at this time.
The above summary is taken solely from exploration reports dated 1999 and 2000, of Frontier reviewed by Stephen Walters, MSc, MAIMM, a qualified person and a director of Azure, without the advantage of confirming the geology and mineralization from a field visit.
Trenching programs on the northern margin of the diatreme breccia (western breccia) and in the Ada'Raye zone on the southeast side of G.Seruyung, indicate further mineralization. The mineralized zone in the diatreme is 300 metres long and open ended, and has returned channel sampling from two trenches returning 31 metres at 1.5 grams per tonne Au and 96 metres at 1.25 grams per tonne Au. Previous work has not fully defined the extent of mineralization.
Information for this new release was provided by Mr. Walters.
© 2005 Canjex Publishing Ltd.