Network Picha Project with Lara Explorations
Network signs definitive agreement to option Picha Project with Lara
VANCOUVER, Oct. 19, 2011 /CNW/ - Network Exploration Ltd. (the "Company" or "Network") (TSX.V: NET) is pleased to announce the signing of the definitive agreement (the "Agreement") between Network and Lara Exploration Ltd. ("Lara") under which Network has the option to acquire up to a 75% undivided working interest (the "Option") in and to certain mineral concessions known as the Picha project (the "Property"), located approximately 125km NE of Arequipa Peru as referred to in the Company's press release dated April 11, 2011.
Picha Project Option
Under the terms of the Agreement, the Company may earn an initial 55% undivided working interest in the Property by paying to Lara an aggregate of US$200,000, with US$50,000 payable upon execution of the LOI (paid), an additional US$50,000 payable upon acceptance of the Agreement by the TSX Venture Exchange (the "Approval Date") and an additional US$100,000 on the date that is 12 months following the Approval Date. The Company has also agreed to issue to Lara 3,500,000 units (the "Units") within five days of the Approval Date. Each Unit is comprised of one common share in the capital of the Company (a "Common Share") and one non-transferable Common Share purchase warrant (a "Warrant"). Each Warrant will entitle Lara to purchase one Common Share at a price of
.10 per common share, exercisable for a period of two years from the Approval Date. The Company has also agreed to fund aggregate expenditures of US$3,000,000 on the Property, with US$500,000 to be funded on or before the date that is one year following the Approval Date, an additional US$1,000,000 to be funded on or before the date that is two years following the Approval and an additional US$1,500,000 to be funded on or before the date that is three years following the Approval Date. Upon the completion of the above payments, issuances and funding, the Company will hold a 55% undivided working interest in the Property.
Under the terms of the Agreement, the Company then may earn an additional 20% undivided working interest (for a total undivided interest of 75%) in the Property by paying to Lara US$1,000,000 within 30 days of electing to exercise this additional option (the "Election Date") and funding aggregate expenditures of US$5,000,000 on the Property, with US$1,000,000 to be funded on or before the date that is one year following the Election Date, an additional US$1,500,000 to be funded on or before the date that is two years following the Election Date and an additional US$2,500,000 to be funded on or before the date that is three years from the Election Date. The Company must also complete a pre-feasibility study compliant with National Instrument 43-101 "Standards for Disclosure of Mineral Projects" (the "Pre-Feasibility Study") and any such costs incurred in connection with the completion of the Pre-Feasibility Study will be included as work expenditures required to earn the additional 20% undivided working interest in the Property. Upon completion of the above payments and funding, the Company will hold a 75% undivided working interest in the Property.
Picha Project
The 6,000 hectare Picha Copper-Silver Project is located within the Tertiary Volcanic Arc of Southern Peru, host to various epithermal gold-silver deposits and copper porphyry-skarn deposits. The Property is adjacent to the properties of Gold Fields Limited and Compañía de Minas Buenaventura S.A., that are host to the recent Chucapaca discovery, with reported mineral resources of 5.6 million gold equivalent ounces. Lara's exploration work on the Picha Project in 2010, found widespread alteration, brecciation and vein stockworking, indicative of the presence of a porphyry system at depth, and outlined seven zones with anomalous copper and associated silver values (see Lara news release of September 21, 2010). Several of these mineral occurrences have been mined on a small scale in the past, from adits, shafts and small open pits, but to date the Property has never been drill-tested.
Quality Control and Qualified Person
This press release has been approved by Bob Friesen, P. Geo, a director of the Company and the Company's Qualified Person.
Closing of the transaction is subject to a number of conditions
The completion of the Option is subject to a number of conditions, including but not limited to the receipt of a satisfactory title opinion with respect to the Property, approval of a National Instrument 43-101 compliant technical report on the Property by the TSX Venture Exchange, financing, and the acceptance of the Agreement by the TSX Venture Exchange.
About Network
Network Exploration Ltd. is a mineral exploration company committed to building shareholder value through the acquisition of base and precious metal properties in North and South America. For additional information, please contact the office at 604-638-7363 or toll-free at 1-866-637-5138, or visit www.networkexploration.com.
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 release.