WTM moving fastWest Timmins Mining to Acquire 75% Stake in Red Pine Exploration's Gold Property in Timmins
8/26/2009 8:02:37 AM - Market Wire
TORONTO, ONTARIO, Aug 26, 2009 (MARKETWIRE via COMTEX News Network) --
Red Pine Exploration Inc. (TSX VENTURE: RPX) ("Red Pine" or the "Company") announces it has entered into a Letter of Agreement with West Timmins Mining Inc. (TSX: WTM) ("West Timmins") pursuant to which West Timmins has the option to acquire a 75% undivided right, title and interest in Red Pine's hydrothermal gold "Costello" Property located in the Porcupine Mining Division of Northern Ontario.
The "Costello" consists of 9 claim units totaling approximately 160 hectares in Bristol Township of the Porcupine Mining Division of Northern Ontario, located 18 kilometres due west of Timmins Ontario.
It is positioned one (1) kilometre east of Lake Shore Gold's "Timmins West" (Holmer) Gold Deposit and two (2) kilometres east of West Timmins' Thunder Creek Gold Property.
Kirk McKinnon, President and CEO of Red Pine stated, "We are very pleased to have concluded a Letter of Agreement outlining the principle terms of an agreement between Red Pine and West Timmins. Their seasoned management and very knowledgeable team of geologists possess an in-depth understanding of the area. We have been very encouraged with the recent ground work and analysis completed from the soil sampling completed this year on the Property, and by the gold mineralization being intersected by West Timmins Mining. This partnership with West Timmins will allow us to further develop the exploration potential of the Costello Property."
The Costello Property
The highly prospective Bristol Fault, which intersects the Thunder Creek Fault proximal to the Timmins Mine, crosses through the Costello Property. Initial work by Red Pine indicates the presence of gold mineralized quartz-tourmaline veins, which are an important component of the Timmins Mine gold system and located in close proximity to the Bristol Fault on the Property.
Immediately after acquiring the Costello Property in 2008, Red Pine carried out a detailed ground magnetometer survey, which defined several prospective structural lineaments.
The Company subsequently trenched an area surrounding a historic gold showing, located in the south-central part of the property and realized anomalous channel sample values of 1.68 g/t gold over 15 cm; 0.22 g/t gold over 30 cm; 0.24 g/t gold over 15 cm; and 0.68 g/t gold over 1.5 m. These gold values were hosted in narrow quartz veins intruding Porcupine age sedimentary rocks.
In November, 2008, Red Pine carried out a magnetic total field survey at 100 m line spacing and 12.5 m station spacing, covering most of the Costello property. Several dike features were recognized either terminating or changing direction at the interpreted Bristol Fault (Archean shear zone).
In June, 2009, Red Pine carried out a soil sampling survey over most of the Costello property along the cut lines at 50 m sample spacing. Results are pending and will be further processed by proprietary methodology used by Dr. Larry Hulbert of Calgary.
Red Pine is encouraged by the presence of gold-bearing quartz tourmaline veins on the Costello Property that are spatially associated with interpreted deformational and structural geological features that may have provided the necessary conduit through which gold-rich solutions could pass.
The Agreement
In order to acquire its interest in the Property from Red Pine, West Timmins must make the following payments to Red Pine within specified timelines outlined in the agreement:
i) cash payment in the amount of $150,000;
ii) issue an aggregate of 150,000 common shares of West Timmins; and
iii) incur expenditures on the Property of at least $300,000 on or before the date which is 18 months from the Effective Date.
The agreement is subject to respective Board and TSX Venture Exchange approvals. All securities issued with respect to this transaction are subject to a four month hold period.
The Parties have agreed to execute a Definitive Agreement forthwith which will incorporate the principal terms of the Letter of Agreement including an industry standard dilution clause.
About Red Pine
The Company has a long tradition of gold exploration and production including the Edwards property and the Edwards Gold Mine in the Wawa area. Red Pine Exploration's current exploration projects focus on gold properties in Northern Ontario, specifically which are either in or near the prolific gold district of Timmins. Red Pine Exploration is based in Toronto, Ontario, Canada and trades on the TSX Venture listed company under the symbol RPX.