Trading Symbol TSX V: GTC
VANCOUVER, Sept. 15 /PRNewswire-FirstCall/ - Getty Copper
Inc (TSXV:GTC) announced today the signing of a letter of intent
("LOI") with EffiSolar Energy Corp., an affiliate of a large
Chinese conglomerate, Zhejiang Guoguang Science and Technology
Group (ZGSTG) , under which ZGSTG has acquired the right to carry
Getty's North, South and adjacent deposits in Highland Valley
British Columbia to production for a 51% joint venture interest in
the project. Under the LOI, ZGSTG is required to spend a minimum of
$5 million over 36 months to test the
expansion potential of the known copper reserves beyond the
currently estimated (proven and probable) figure of 86.6 million
tons grading 0.4% Cu (see May, 2010 prefeasibility study at
www.SEDAR.com). $3 million of the
$5 million is a firm commitment and
the balance is optional.
After investing $5 million in the
project ZGSTG will conduct and pay for such additional work as is
required to produce a feasibility report so that ZGSTG can arrange
100% of the debt and equity financing needed to take the project to
commercial production, the cost of which is currently estimated at
$400 million. Getty's share of the
required equity portion of the financing must be arranged on
Getty's behalf by ZGSTG and is recoverable by ZGSTG as priority on
90% of cash flow from the mine. If the participation in the project
by a major mining company is required to secure the production
financing, then Getty and ES will give up equal equity to the third
party but Getty will retain a minimum 33 1/3% interest in any event
and will then also have a priority over ES from cash flow (after
recovery of equity advanced) for the estimated amount of mine
value, represented by the mine NPV in the feasibility study, which
is given up to the major by Getty.
If ZGSTG elects to terminate its involvement after the first
$3 million is spent it can convert
its interest into 10 million Getty shares valued at $0.30 each (11% of Getty shares as of today) and
if ZGSTG terminates after that, it is limited to a 10% net profits
interest capped at 2 times aggregate investment by ZGSTG. The LOI
contemplates a final feasibility study at the latest within 54
months after which time production financing must be obtained by
ZGSTG within 6 months failing which Getty has the right for 6
months to secure the production financing and can then reduce ES to
the capped NPI. The initial $3
million program must be spent within 24 months and will
concentrate on Titan 24 geophysical and diamond drilling to test
the theory of a second fault zone and the interconnectedness of the
Getty North and South deposits and adjacent anomalies.
The LOI is subject to completion of ZGSTG's due diligence
review, TSX approval and the negotiation of a definitive agreement
all of which is targeted for 30 days. A further news release will
be made when definitive agreements are completed and the conditions
fulfilled.
Corby Anderson, Getty CEO
commented, "We are pleased that the potential of the known Getty
deposits has been recognized by a partner that is capable of moving
them at least to the next level and if warranted all the way to
production. We look forward to working with the Zhejiang Guoguang
Group and getting back to advancing the project on the ground".
William Xu, the Canadian
representative of ZGSTG said "We have confidence in the value of
copper and we chose Getty after looking at other possible copper
projects. This project hosts a significant deposit at grades higher
than the large mine next door is now profitably mining. We look
forward to investing and working together to push this project
forward."
About Zhejiang Guoguang Science and Technology Group
----------------------------------------------------
ZGSTG is based in the City of Quzhou, China and has divisions engaged in chemical,
electrical transformers, and medical machinery production and it
has also made large investments in renewable energy. ZGSTG has 2500
employees and annual turnover in the US$150
million range.
About Getty Copper Inc.
-----------------------
Getty is a Vancouver based
company focussing efforts on advancing its 200 square kilometre
copper property which is immediately adjacent to Teck's Highland
Valley copper mine. Getty recently filed a 43-101 compliant
pre-feasibility study over the two known copper deposits which
cover less than 10% of the property area.
ON BEHALF OF THE BOARD OF DIRECTORS
Dr. Corby G. Anderson QP CEng FIChemE, President and COO.
Dr Anderson is the Qualified Person who assumes responsibility
of the technical contents of this news release.
This release includes certain statements that may be deemed
"forward-looking statements". All statements in this release, other
than statements of historical facts, especially those that address
the need for definitive agreements to be negotiated and executed,
and estimated resource quantities, grades are forward-looking
statements because they are based on future events or made on the
basis of estimation from limited information such as a fixed number
of number of drill holes and metallurgical studies. The Company
does not have reserves for US reporting standards and the estimate
of reserves for Canadian reporting purposes is conjectural being
based only on a pre-feasibility study which uses broadly defined
cost and production estimates. The study is available at
www.sedar.com. Although diamond drill hole core provides valuable
information about the size, shape and geology of an exploration
project, there will always remain a significant degree of
uncertainty in connection with these valuation factors until a
deposit has been extensively drilled on closely spaced centers
which has occurred only in specific areas on the Getty Project.
Although the Company believes the expectations expressed in its
forward-looking statements are based on reasonable assumptions,
such statements should not be in any way construed as guarantees of
the ultimate size, quality or commercial feasibility of the Getty
Project or of the Company's future performance. Subsequent results
and developments may differ materially from those postulated in the
estimates and forward-looking statements. Other factors that could
cause the Company's actual results and performance to differ
materially from those in forward-looking statements include adverse
market prices for metals, the conclusions of detailed feasibility
and technical analyses, lower than expected grades and quantities
of resources, mining rates and metal recovery rates and the fact
that necessary capital may not be available to the Company on terms
acceptable to it or at all. The need for compliance with extensive
environmental and socio-economic rules and practices and the
requirement for the Company to obtain government permitting can
cause a delay or even abandonment of a mineral project. The Company
is subject to the specific risks inherent in the mining business as
well as general economic and business conditions. For more
information on the Company, Investors should review the Company's
annual Form 20-F filing with the United States Securities
Commission and its home jurisdiction filings that are available at
www.sedar.com
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this release.
SOURCE Getty Copper Inc.
Copyright . 15 PR Newswire