VANCOUVER, Dec. 13, 2012 /CNW/ - Guyana Frontier Mining
Corp. ("Guyana Frontier", TSXV:
GYG) wishes to update its shareholders on the status of the
proposed transaction with Horizonte Minerals Plc. ("Horizonte", AIM
and TSX: HZM) for the acquisition of the Falcao Gold Project
("Falcao"), and on the status of certain mineral exploration
properties in Guyana, South America and Ontario, Canada. As previously announced in
its news release of November 6, 2012,
Guyana Frontier has signed a definitive share purchase agreement to
acquire Falcao, located in northern Brazil, by purchasing all of the shares of a
subsidiary company of Horizonte.
Status of the Falcao Acquisition
Transaction
On December 11,
2012, Guyana Frontier submitted to the TSX Venture Exchange
("TSXV") a draft disclosure document that describes the proposed
acquisition of Falcao, which contains detailed technical and
financial information regarding Guyana Frontier, Falcao and the
subsidiary of Horizonte being acquired by Guyana Frontier (the
"Filing Statement"). Upon its review and acceptance by the TSXV,
Guyana Frontier intends to file
the Filing Statement on SEDAR (www.sedar.com), and subsequently
seek written consent from a majority of its shareholders approving
the acquisition of Falcao ("Shareholders' Written Consent").
Following the receipt and confirmation of such Shareholders'
Written Consent, Guyana Frontier would complete the acquisition of
Falcao in consideration for the issuance to Horizonte of 84,000,000
common shares of Guyana Frontier (the "Consideration Shares") at a
deemed price of $0.05 per
Consideration Share (the "Acquisition Transaction"). After the
closing of the Acquisition Transaction, and including the 8,000,000
common shares purchased by Horizonte in the private placement
announced on November 6, 2012,
Horizonte will beneficially own approximately 47.1% of the issued
and outstanding common shares of Guyana Frontier. Closing of the
Acquisition Transaction is now anticipated to occur in January 2013.
The Acquisition Transaction is subject to the
acceptance of the TSXV, and the Consideration Shares issued by
Guyana Frontier to Horizonte will be subject to a four month
trading restriction pursuant to applicable securities laws and the
policies of the TSXV. The Consideration Shares will also be subject
to escrow requirements pursuant to the policies of the TSXV.
Potaro-Maple Creek Property
In November 2012,
Guyana Frontier terminated its lease agreements with the vendors of
the Maple Creek, Pepper Creek,
Little Uewang, Queen of Diamonds and Alphonso-Parks properties,
collectively known as the Potaro-Maple Creek property ("Potaro"),
due to the ongoing costs of maintaining Potaro. At the same time,
Guyana Frontier completed purchase and sale agreements for its
wholly-owned mining equipment located at Potaro property for gross
proceeds to Guyana Frontier of GUY$24,000,000 (US$120,000), subject to a 12.5% commission
payable to an agent of Guyana Frontier. As a result of the
termination of all the property lease agreements and completion of
the sale of its mining equipment at Potaro, Guyana Frontier holds
no further interest in Potaro.
Guiana Shields Resources Properties
Guyana Frontier holds an option to acquire a
100% interest in the Guiana Shield Resources Inc. ("GSR")
properties, pursuant to a property option agreement between Guyana
Frontier and GSR dated August 15,
2009 (the "GSR Agreement"). Guyana Frontier can acquire a
100% interest in the GSR properties by issuing GSR an aggregate of
5,000,000 common shares and paying GSR an aggregate of US$700,000 (see Guyana Frontier news releases
dated April 6, 2009, May 28, 2009 and January
5, 2010). In addition, Guyana Frontier will issue GSR
1,000,000 common shares on the issuance of a mining licence in any
project area, and pay a supplemental amount of US$1.00 for each ounce of gold set out in the
mineral resource estimate contained in the feasibility study
submitted to the Guyana Geology and Mines Commission (the "GGMC")
in respect of the application of such mining licence. GSR will also
retain a 3% net smelter returns royalty in respect of the GSR
properties, which Guyana Frontier
may purchase back the first percentage point for US$1.0 million, US$2.0
million for the second percentage point, and US$3.0 million for the final percentage point.
Guyana Frontier has made the required payments and share issuances
necessary to effect the early exercise of the option granted
pursuant to the GSR Agreement, and is currently awaiting formal
acknowledgement from GSR regarding the early exercise of the
option.
On August 1, 2010,
Guyana Frontier entered into a separate property option agreement
(the "Otomung Agreement") with GSR, where it can acquire a 100%
interest in the Otomung property by issuing GSR an aggregate of
500,000 common shares and paying GSR an aggregate of US$125,000 (see Guyana Frontier news release
dated November 29, 2010). Guyana
Frontier has made the required payments and share issuances
necessary to effect the early exercise of the option granted
pursuant to the Otomung Agreement, and is currently awaiting formal
acknowledgement from GSR regarding the early exercise of the
option.
In April and August
2012, Mulgravian Ventures Corporation, Guyana Frontier's optionee for the GSR
properties, surrendered back to Guyana Frontier 10 prospecting licences within
the GSR property portfolio, namely the Aunama, Arawini, and Otomung
properties, while retaining the Whana and Masawaki properties. In
August 2012, at the time of their
anniversary dates, Guyana Frontier submitted renewal applications
for certain of the surrendered prospecting licences to the GGMC.
Subsequent to the submission of the renewal applications, Guyana
Frontier returned all 8 of the Aunama and Arawini licences back to
GSR, due to the cost of maintaining and exploring those licences.
Guyana Frontier intends to retain the two Otomung licences, and
awaits notice from the GGMC on the status of their renewal.
Canadian Properties
Beginning in March
2011 and up to October 2012,
Guyana Frontier surrendered all of its Canadian properties back to
their respective vendors, with the exception of the Favourable Lake
Silver-Gold Project ("Favourable Lake"), located in the Red Lake
Mining Division approximately 200 kilometres north of Red Lake, Ontario. On April 20, 2009, Guyana Frontier and Gold Canyon
Resources Inc. ("Gold Canyon") executed a joint venture agreement,
where Guyana Frontier initially held a 60% interest, and Gold
Canyon held a 40% interest in Favourable Lake. Under the terms of
the joint venture agreement, Guyana Frontier acts as operator at
Favourable Lake and solely funded exploration programs in 2010 and
2011. Because Gold Canyon did not contribute funding to these
exploration programs, Gold Canyon's participating interest was
diluted to 27.0%, while Guyana Frontier now holds a 73.0% interest
in Favourable Lake.
About Falcao
Falcao consists of three exploration permits and
one exploration permit application totalling approximately 32,460
hectares (80,209 acres) located in the Carajas Mineral Province of
northern Brazil. The Project lies
within the eastern extension of the Serra do Inaja greenstone belt
discovered by Mineracao Colorado, (BHP Minerals) in the mid-1980s
and covers a very large (more than 40 square kilometres) historical
multi-point gold, silver and copper geochemical anomaly. In 2011,
Horizonte as operator completed a 15-hole, 3,663 metre drilling
program at Falcao (for drilling results, see Guyana Frontier News
Release dated November 6, 2012).
Falcao is subject to an option agreement (the
"AngloGold Option Agreement") with AngloGold Ashanti Limited
("AngloGold"), one of the world's largest gold producers, whereby
AngloGold can earn an initial 51% interest in the Project by
incurring US$4.5 million in
exploration expenditures on the Project. AngloGold has
completed expenditures of over US$3.8
million to September 30, 2012,
and has a work commitment of approximately US$700,000 remaining.
About Horizonte
Horizonte is an AIM and TSX-listed mineral
exploration and development company focused on nickel and gold
projects, principally in Brazil.
Horizonte has two committed major mining partners: Teck Resources
Limited, a major strategic shareholder in the company, and
AngloGold, a joint venture partner on selected projects.
Horizonte's principal asset is its wholly-owned
Araguaia nickel project located in Pará State in Brazil. In January
2012, Horizonte released an updated National Instrument
43-101 compliant nickel mineral resource, which included an
Indicated Mineral Resource of 39.3 million tonnes grading 1.39%
nickel together with an Inferred Mineral Resource of 60.9 million
tonnes grading 1.22% nickel, both at a 0.95% nickel cut-off.
About Guyana Frontier
Guyana Frontier is a TSXV-listed public mineral
exploration company focused on the exploration, discovery and
development of precious metals deposits in Guyana and Brazil, South
America. Guyana Frontier began acquiring interests in
Guyanese exploration properties in 2007, and now holds rights to
obtain working interests in approximately 209,824 acres (84,915
hectares) of prospective lands in Guyana.
Guyana Frontier's primary goal is to develop a
significant gold resource at the Marudi Mountain Gold Project in
located in southern Guyana, and to
explore its other projects in Guyana and Brazil with joint venture partners.
Neither the TSX Venture Exchange nor its
Regulation Services Provider
(as that term is defined in the policies of the TSX Venture
Exchange)
accepts responsibility for the adequacy or accuracy of this
release.
Forward Looking Statements
This release contains "forward-looking
statements" within the meaning of applicable Canadian securities
legislation, including predictions, projections and
forecasts. Forward-looking statements include, but are not
limited to, statements that address activities, events or
developments that Guyana Frontier expects or anticipates will or
may occur in the future, including such things as the closing of
the Acquisition Transaction, the acquisition by Guyana Frontier of
an interest in the Falcao Project, Guyana Frontier's future
exploration activities and the growth of Guyana Frontier's
businesses and general operations and plans.
Often, but not always, forward-looking
statements can be identified by the use of words such as "plans",
"planning", "planned", "expects" or "looking forward", "does not
expect", "continues", "scheduled", "estimates", "forecasts",
"intends", "potential", "anticipates", "does not anticipate", or
"belief", or describes a "goal", or variation of such words and
phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be
achieved.
Forward-looking statements are based on a
number of material factors and assumptions, including the
completion of various conditions precedent to the closing of the
Acquisition Transaction, such as receipt of all regulatory
approvals, including that of the TSX Venture Exchange, and receipt
of the approval of Guyana Frontier's shareholders. Although Guyana
Frontier has attempted to identify important factors that could
cause actual actions, events or results to differ materially from
those described in forward-looking statements, there may be other
factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements.
Guyana Frontier does not assume the obligation to revise or update
these forward-looking statements after the date of this document or
to revise them to reflect the occurrence of future unanticipated
events, except as may be required under applicable securities
laws.
SOURCE Guyana Frontier Mining Corp.