BARRA DA TIJUCA, Brazil (PRWEB) February 06, 2013
Lion Gold Brazil, Inc., a Nevada Corporation (Pink Sheets: LGBI) ("the Company"), and a leader in gold exploration and exploitation in Brazil, headquartered in Barra da Tijuca, Brazil, is pleased to announce that a revision of the original agreement with the Vendor, LOS ANDES MINERAÇÃO LTDA, to acquire the Heitorai Gold Project has been achieved.
The Company has already paid US$ 30,000 during 2012 and according to the amendment in the contract, it will now have the full year of 2013 to explore the project prior to the next payment. There is a commitment to expend at least US$ 100,000 for exploration during the first half of 2013 and the same value in the second half of the year and 2014 and 2015 to complete the exploration works.
According to the agreement, Lion Gold Brazil has the right to acquire 100% of the Heitorai Gold Project; it will acquire 51% by paying US$ 650,000 to the Vendor and spending a minimum of US$ 1 million in exploration over a three year period, and it can acquire an additional 24% equity by investing an additional US$ 1 million in exploration, prepare a pre-feasibility study, and the payment of US$ 2/oz premium to the Vendor based on the measured and indicated resources defined in the pre-feasibility study by the end of fourth year (2016); the remaining 25% can be acquired by paying the Vendor 5% of the value of the ounces defined as measured and indicated gold reserves in the pre-feasibility study limited to a minimum value of US$ 10 million.
Lion Gold may withdraw from the option arrangement at any time if, at its sole discretion, it decides that the project does not meet its financial objectives.
It is very important to note that the Heitorai Gold Project was previously explored by a major Australian mining company from 1985 to 1986 when gold prices were at $360 per ounce. Gold mineralization at Heitorai property was discovered during a regional stream sediment program and was delineated by soil sampling and RC (Reverse Circulation) drill holes (38 holes in 1,895 m). The program outlined a northwest trending gold-in-soil anomaly that is over 8,000 m in length. Short RC holes tested 1,000 m of this strike length to a depth of approximately 80 m; the mineralized zone varies from 1 to 4 meters thick and is open in all directions.
Gold mineralization is associated with sericite-silica-sulphide altered granitic Rocks, apparently shear controlled, splaying from a major low angle thrust regional fault. Gold mineralization above 0.30 gram/ton was intersected in 20 RC drill holes, with values ranging from 0.30 g/t to 3.82 g/t. The concession was allowed to expire by the major Australian mining company because of depressed gold prices at the time. The best concession (1,948 hectares) covering the Heitorai gold-in soil anomaly, where a gold deposit might be delineated, was subsequently pegged by Los Andes and acquired by Lion Gold Brazil in 2012.
The company intends to explore the entire 8,000 m gold-in-soil anomaly for a shallow gold mineralization in the oxide horizon amenable for immediate mining and for the blind flat lying mother lode, re-establishing the soil grid and infill sampling; also carrying on a follow up drilling (diamond drilling) of the shallow and high grade intersection of the historic drill holes such as the CRC-17 with 1 m @ 1.50 g/t, CRC-22 with 1m @ 3.82 g/t and the CRC-32 with 1 m @ 2.05 g/t, and conducting a ground geophysical (Induced Polarization) program across the zone with gold-in soil anomaly to inspect for blind lode.
The Heitorai gold project is located in the Goias State, Central Brazil; the region benefits from excellent infrastructure including paved road access, low cost electrical power and the availability of a local skilled workforce.
Mr. Abergel, CEO of Lion Gold, has commented “This agreement has given us the required time to raise the initial funds to start up the exploration activities in this exciting project which has the potential to add anywhere from 200,000 to 700,000 ounces in gold reserve to the company’s inventory and provide a shallow gold mineralization program ready and available to be mined as early as possible at no more than 12 months from plant funding”.
About Lion Gold Brazil Inc.
Lion Gold Brazil is a USA-based public company with focus on the acquisition, exploration, development and mining of gold properties located in northern and central Brazil. The Company has the option on 3 projects, 2 of them in the prolific Tapajós Mineral Province and one project in the Central Brazil; it intends to start production early in the exploration phase by defining shallow gold mineralization in the oxide horizon and in the alluvials.
Competent Person Statements
The information in this announcement that relates to historical exploration results is based on information compiled by the geological consultant Mr. Antonio de Castro, who is a Member of the Australasian Institute of Mining and Metallurgy (M. AusIMM). Mr Castro has sufficient experience which is related to the style of mineralization and the type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” . Mr Castro consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.
This announcement contains forward-looking statements which involve a number of risks and uncertainties. These forward looking statements are expressed in good faith and believed to have a reasonable basis. These statements reflect current expectations, intentions or strategies regarding the future and assumptions based on currently available information. Should one or more of the risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary from the expectations, intentions and strategies described in this announcement. No obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future development.