Rainmaker Resources Ltd. Acquires Bray Frac Sand Property, Arkansas; Receives Highly Encouraging Test Results
19 6월 2014 - 7:00PM
Marketwired Canada
Rainmaker Resources Ltd. (TSX VENTURE:RMG) ( "Rainmaker") is pleased to announce
that it has entered into a binding Letter Agreement with Arkansas Silica LLC
("ASL") to acquire an Option to Purchase the 304-acre Bray Frac Sand property,
located in NE Arkansas. ASL has entered into an Option to Purchase Agreement
(the "Option") with the landowners, dated May 30, 2014. This Option gives ASL
the right to purchase the property outright for US$1,100,000 on or before
January 5, 2015.
Highly encouraging results have been received from testing on sand samples
obtained during a preliminary test drill program.
Prior to negotiating the terms, Company management and technical representatives
visited the property on several occasions to test and sample the property. This
included a two day drill program, using an inexpensive water well rig, to drill
three test holes. The three drill holes demonstrated sand thicknesses of 80 ft.,
greater than 90ft. and greater than 120 ft. respectively. Analytical work on two
composite samples yielded results that were better than the industry standard
recommended values for all parameters. Details are presented below.
The Company will now commence a comprehensive sonic drill program with the
objective of completing an NI 43-101 compliant resource estimate.
Test Drilling:
The drilling consisted of three mud-rotary holes to test the thickness of the
sand formation, and to collect sand material for subsequent testing. The three
holes were all collared in sand, and intersected sand as follows:
Hole B-1 depth to base of sand 80 feet
Hole B-2 hole stopped at 120 feet, still in sand
Hole B-3 lost circulation at 100 feet, still in sand at 90 feet.
Two composite sand samples were prepared from the drill cuttings, and were
submitted to Stim-Lab, Inc in Duncan, Oklahoma. The samples were dried, weighed
and washed through a 200 mesh screen. The two composites were then tested for
sphericity, roundness, acid solubility, bulk density, apparent density and crush
resistance (K-value). The procedures followed were as stated in ISO
13503-2:2006/API RP19C:2008.
The sieve test yielded the following results:
Percentage of sand within size fraction
Size fraction Composite 1 Composite 2
----------------------------------------------------------------------------
20/40 6.1 5.7
30/50 28.4 26.2
40/70 58.0 56.2
70/140 33.0 35.3
Note - these percentages add up to more than 100% because the ranges of the size
fractions overlap.
It was decided that the full testing would proceed on the 30/50 size for
Composite 1, and on the 40/70 size for Composite 2. Results as are follows:
----------------------------------------------------------------------------
API test
results
----------------------------------------------------------------------------
Comp 1 Comp 2
30/50 size 40/70 size Notes
----------------------------------------------------------------------------
Sphericity 0.8 0.7 minimum recommended value = 0.6
----------------------------------------------------------------------------
Roundness 0.7 0.7 minimum recommended value = 0.6
----------------------------------------------------------------------------
Acid maximum recommended value for
solubility 1.45% 1.30% 30/50 = 2.0%, for 40/70 = 3.0%
----------------------------------------------------------------------------
Bulk density 1.45 g/cm3 1.42 g/cm3
----------------------------------------------------------------------------
Apparent
density 2.63 g/cm3 2.64 g/cm3
----------------------------------------------------------------------------
highest stress value generating no
K-value 6K 8K more than 10% crushed material
----------------------------------------------------------------------------
Director of Rainmaker, Alan Young, P.Eng, commented, "This sand is an excellent
quality frac sand that exceeds all the key attributes as outlined by the ISO/API
standards referenced above, for the specified sand sizes. These attributes will
make the sand a solid technical contender for use in either US or Canadian
fracture stimulation applications. We are confident that the additional
delineation wells will serve to prove up the extent and potential value of the
play."
Letter Agreement:
ASL will assign its interest in and to the Option in consideration of payment of
$175,000 and the issuance of 2,500,000 shares of Rainmaker's capital stock,
payable in five installments over a four year period from the effective date of
the agreement. In addition, Rainmaker will pay ASL a royalty of $1.00 per short
ton of frac sand extracted, processed, sold and delivered.
Bray Property:
The Bray Frac Sand property is located in Izard County, north-central Arkansas,
and has excellent access from State highways. The property is approximately 30
miles north of the city of Batesville, AR. Rail access is available in
Batesville, with several potential loading sites present. The currently
operating Bluebird Sand LLC frac sand operation is located approximately 5 miles
southwest of the Bray property.
The property is underlain by the St Peter Sandstone, of Ordovician age, and is
homogeneous pure quartz sand. The St Peter sandstone (also known as the Ottawa
sand in commercial operations) is considered to be a major source of frac sand
within the United States, especially in Wisconsin. The Arkansas Geological
Survey reports that in the nearby Mt. Pleasant area the sand ranges from 135 -
150 feet in thickness. On the Bray property, drilling by Rainmaker has
demonstrated thicknesses in excess of 120 feet. Bluebird Sand LLC produces frac
sand from the same formation.
Rainmaker President and CEO, Rick Patmore commented, "The Bray Frac Sand
property is ideally situated to service the Eagle Ford, Fayetteville and New
Albany shale plays. The Ottawa sands are of a top pedigree of frac sand in this
industry. We look forward to briskly moving this project toward development for
the benefit of all shareholders. With Mexico now lifting their moratoriums this
is another avenue Rainmaker could have for a client base. We are very excited
about this opportunity as we believe that the size of this property could turn
Rainmaker into a real contender in this arena for years to come."
The transaction is subject to acceptance by the TSX Venture Exchange.
Chris M. Healey, P.Geo, a Director of Rainmaker, is the qualified person
responsible for the technical content of this release.
On behalf of the Board of Directors
Rick Patmore, President and CEO, Rainmaker Resources Ltd.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the
proposed transaction and has neither approved nor disapproved the contents of
this press release.
The TSX Venture Exchange has not reviewed and does not accept responsibility for
the adequacy or accuracy of the content of this News Release. WARNING: The
Company relies on litigation protection for "forward looking" statements. Actual
results could differ materially from those described in the news release as a
result of numerous factors, some of which are outside the control of the
Company. This news release does not constitute an offer to sell or a
solicitation of an offer to sell any of the securities in the United States. The
securities have not been and will not be registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities Act") or any state
securities laws and may not be offered or sold within the United States or to
U.S. Persons unless registered under the U.S. Securities Act and applicable
state securities laws or an exemption from such registration is available.
FOR FURTHER INFORMATION PLEASE CONTACT:
Rainmaker Resources Ltd.
Judy A. McCall
Corporate Communications
604.638.8030
news@rainmakerresources.ca
www.rainmakerresources.ca
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