Vancouver, Canada (PRWEB) April 26, 2005
Solomon Resources Ltd (SRB:TSX-V) today announced that it has executed a Formal Option Agreement granting it options on each of 20 gold and copper projects in Mongolia, from Gallant Minerals Ltd.
The Agreement includes GallantÂs most advanced gold projects, including Bayantsagaan, located 35 kilometres southwest of the Boroo Mine; the Onon gold project, southwest of the 17 million ounce Bayley Gold District; and the Zos Uul project, a Carlin-type gold discovery in southeast Mongolia. In total, Solomon has optioned 6 gold projects, 6 porphyry copperÂgold projects, and 8 early stage gold and copperÂgold projects. Most of the projects are located within the productive South Gobi Arc terrane (Oyu Tolgoi) or the Ervana Terrane (Erdenet Mine) as shown on the attached map.
Under the Agreement, Solomon has the option to earn a minimum 80% interest in each of the projects. Once Solomon has earned that interest, Gallant can then either participate on a joint venture basis with a 20% interest, or elect to convert its interest into an NSR royalty.
Gallant Minerals Ltd. was founded by Mr. Mohamed Al Fayed, and started exploration in 1997,by integrating advanced technology and rigorous field exploration to evaluate large tracts of the country, acquiring properties with potential to host major gold and porphyry deposits. Mr. Al Fayed stated ÂI am very pleased that Solomon has acquired our best gold properties in Mongolia. I am confident that they will rapidly advance these properties to achieve the full value and potential of each property.Â
Keith Laskowski, President and COO of Solomon said ÂMongolia is highly endowed with gold and copper, and its strategic location, next to major import markets of China make it one of the best places in the world to explore and develop. Many of SolomonÂs new projects are close to the southern Mongolian border, proximal to entry ports into China. The Government of Mongolia continues to support a pro-investment, pro-development, and probusiness environment. We are very excited to have this chance to explore and acquire these properties from Gallant Minerals.Â
The Option Agreement includes 37 exploration licenses covering 185,000 hectares of land in Mongolia (see map). The portfolio is divided into three major groups, based on the types of commodities sought and the level of exploration. The following table is a summary of the properties in Mongolia subject to the Option Agreement:
Solomon Mongolia Properties
Gold Projects 6 17
Porphyry and Base
Metal Projects 6 10
Prospects 8 10
Totals 20 37
SolomonÂs Option and Financial Obligations
Under the Option Agreement Solomon has been granted an exclusive option to acquire 60% of the shares of a Mongolia holding company Braveheart Resources XXK, incorporated to hold the Projects. The option will be exercisable during a period of three years on the condition that Solomon makes the following payments and deliveries to Gallant and incurs the following expenditures on the Projects:
a. Solomon has delivered to Gallant on the execution of the formal Option Agreement (which deliveries have been made):
i. 1,000,000 common shares of Solomon
ii. a payment of US$110,000;
b. on or before April 18th 2006, Solomon shall complete US$1,000,000 of work expenditures on the Projects or pay any remaining balance to Gallant;
c. and deliver to Gallant:
i. US $200,000 worth of common shares of Solomon, and
ii. a payment of US$200,000;
d. on or before April 18, 2007, Solomon shall expend an aggregate of US$3,000,000 of work expenditures (including expenditures spent during the first year) on the Projects or pay any remaining balance to Gallant;
e. and deliver to Gallant:
i. US$450,000 worth of common shares of Solomon, and
ii. a payment of US$300,000;
d. on or before April 18, 2008, Solomon shall expend an aggregate of US$6,000,000 of work expenditures (including expenditures spent during the first and second years) on the Projects or pay any remaining balance to Gallant;
e. and deliver to Gallant US$400,000.
Gallant has also granted to Solomon a second option, subject to Solomon making all payments and exercising its option to acquire 60% of Braveheart Resources, to acquire an additional 20% interest in any Project on which Solomon commits to spend, and then does spend, a further $1,000,000 on or before the fourth anniversary of the Closing Date.
GallantÂs Option to participate or Dilute or Convert to NSR Royalty
For any Project on which Solomon has earned an additional 20% interest, taking its total direct and indirect interest in that Project to 80%, Gallant may at its sole discretion then elect either to:
a. participate in all future expenditure on that Project on a joint venture basis pro rata to its remaining 20% , or
b. convert its 20% interest to an NSR Royalty.
If Gallant elects to dilute to an NSR Royalty on any Project, Solomon shall have the right to reduce the NSR payable to Gallant through purchase at a pre-determined price.
Solomon has paid a finderÂs fee of 200,000 common shares to an armÂs length third party at a deemed price of $0.37 per share in consideration of that party facilitating Solomon acquiring its interest in the transaction.
Qualified Person under National Instrument 43-101
SolomonÂs CEO, Lawrence J. Nagy, P.Geol., a Âqualified personÂ for the purposes of National Instrument 43-101, has reviewed the information contained in and supervised the preparation of this news release.
Forward Looking Statements
Certain information regarding the Company contained herein may constitute forward-looking statements with the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The Company cautions that actual performance will be affected by a number of factors, many of which are beyond the CompanyÂs control, and that future events and results may vary substantially from what the Company currently foresees. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration results, continued availability of capital and financing and general economic, market or business conditions. The CompanyÂs forward-looking statements are expressly qualified in their entirety by this cautionary statement.
About Solomon Resources Ltd.
Solomon Resources Ltd. is a Canadian public company focused on the acquisition, exploration and development of gold mineral properties world wide. The Company is managed by a proven team of explorationists credited with the discovery of a number of significant deposits in the world, including the SNIP Gold Mine and the Eskay Creek Mine in British Columbia and the Brewery Creek Mine in Yukon and the Segala Gold Deposit in Mali, West Africa.
SolomonÂs shares trade under the banner SRB on the TSX Venture Exchange (TSX-V). SolomonÂs other active mineral properties include three large contiguous projects located in the highly productive Eastern Goldfields of Western Australia: the former producing Kalgoorlie Southeast Project (KSP), the Newcrest-KSP J/V and the Harmony- Glandore J/V.
For additional information visit SolomonÂs website at http://www.solomonresources.ca.
On Behalf of the Board of Directors of
SOLOMON RESOURCES LIMITED
Lawrence J. Nagy
Chairman & CEO
Contact Information - Toll Free Phone: 1-866-831-6666
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.