Private Placement
On May 26, 2003 the Company announced a non-brokered private placement of up to
3,000,000 units at a price of C$0.12 per unit and on July 14, 2003 announced that this
would be increased to up to a maximum of 4,000,000 units. The Company is pleased
to announce that the TSX Venture Exchange have provided conditional approval for
the placement which is for a total of 3,464,867 units for total proceeds of $415,784.
Each unit will consist of one common share and one-half of one common share
purchase warrant. One whole common share purchase warrant entitles the holder to
purchase one common share at a price of C$0.16 per share for a one-year period from
the date of closing. The private placement will close when the Company receives final
approval from the TSX Venture Exchange.
Acquisition of Resource Property
On May 26, 2003 the Company announced that it had entered into a Heads of
Agreement pursuant to which it had agreed to purchase 100% of the share capital of
Minera Calipuy S.A.C. (Calipuy), a private company constituted under Peruvian law
by issuing a total of 2,400,000 million common shares in the Company. The
acquisition is subject to TSX Venture Exchange approval. Pursuant to TSX Venture
Exchange policies the Company is required to appoint a sponsoring broker for the
transaction and obtain shareholder approval. The Company is proceeding with
compliance with these requirements.
Calipuy has a binding Letter Agreement with Monterrico Metals PLC to earn up to a
75% interest in the Pico Machay gold project in Southern Peru subject to completing
the following work and expenditure schedule:
- Calipuy may earn an initial 60% interest in the Pico Machay project by
spending a minimum of US$2,000,000 on exploration over four years; and
- Calipuy has the option to acquire a further 15% interest, for a cumulative 75%
interest, by either spending an additional US$2,000,000 on exploration or by
completing a mine development plan in the following year. Calipuy’s mandate
is to identify drill targets and test higher-grade zones of mineralization with
the aim of developing a gold mining operation.
The Pico Machay project is a large high-sulphidation epithermal system where gold
mineralisation is hosted in Tertiary volcanic rocks. The project area is situated in the
Andean Cordillera of Peru and comprises a 3,800 hectare land package centered over
a 2.5 km x 1 km area of advanced argillic alteration with elevated gold values.
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