Acquisition
March 23 2006 - 2:00AM
UK Regulatory
Medoro Resources Agrees to Acquire Venezuelan Gold Properties
TORONTO, March 22 /CNW/ - Medoro Resources Ltd. (TSX-V/AIM: MRL)
announced today that it has entered into an agreement to acquire all of the
shares of Panwest Seas Corporation Ltd., which holds the rights to the Lo
Increible 4A & 4B exploration properties located in the El Callao area of the
State of Bolivar, Venezuela.
The Lo Increible 4A and 4B properties, totaling 2,216 hectares, are
located immediately north, and adjacent to, Crystallex International
Corporation's La Victoria property in the El Callao district of Venezuela. In
addition to Crystallex, Gold Fields, Hecla Mining and CVG-Minerven all have
producing gold mines and are actively exploring for gold in the area. The
properties are held under mining contracts granted by Corporacion Venezolana
de Guayana (CVG).
A significant amount of exploration work has been done on the Lo
Increible concessions over the past decade, resulting in reserve and resource
estimates for the La Cruz, El Tapon, La Sofia and La Loca showings, using a
1.0 g/t cut-off:
Tonnes Grade Gold
(000) (g/t) (ozs)
Indicated resource 5,920 3.9 746,000
Inferred resource 4,731 3.6 548,000
including
Probable reserves 2,068 3.4 225,000
The above resource and reserve estimates are historical in nature, have
not been verified by Medoro's qualified person, and should not be relied upon.
Medoro has initiated its own independent review, the results of which will be
available in the near future.
In addition to these resources, there are strong drill indications of at
least five additional targets - Lapa Dos, Corinas, Tabaire, Los Gritos and La
Cruz West. In addition, there are multiple, strong geochemical soil and rock
sample anomalies that have excellent exploration potential. Also, drilling has
shown that high grade ore shoots occur at depth below the La Cruz deposit.
Medoro intends to initiate an aggressive exploration and resource definition
program on the properties.
Medoro will issue 120,000,000 common shares to the shareholders of
Panwest in consideration of the acquisition of Panwest, and will pay
US$1,000,000 in cash, payable upon closing. The company has also agreed to pay
to the sellers a royalty of US$15 per ounce of gold on all production from the
Lo Increible 4A & 4B mining properties.
Panwest is incorporated under the laws of the British Virgin Islands and
is beneficially owned by a group of ten shareholders consisting of Corporacion
Vengroup, S.A, which owns 35% of Panwest's shares, The Carrington Trust (12%),
The BP Trust (12%), Torino Consultants Ltd. (12%), The KFK Trust (12%),
Orinoquia Belt, C.A. (7.5%), Socobal Corporation (3.25%), Andes Investments
A.V.V. (3.25%), Amerisur Corporation Ltd. (2%) and Peter Volk (1%). All of
these shareholders are at arms' length to the company, other than The BP
Trust, to which Serafino Iacono provides investment advice, Torino
Consultants, which is beneficially owned by Miguel de la Campa, The KFK Trust,
the beneficiaries of which are the family of Jose Francisco Arata, Orinoquia
Belt, which is beneficially owned by Miguel de la Campa and, indirectly, by
The BP Trust and Peter Volk. Each of Serafino Iacono, Miguel de la Campa and
Jose Francisco Arata are directors of the company and Peter Volk is an officer
of the company. As a result, the acquisition of Panwest is regarded as a
"related party transaction" under Ontario Securities Commission Rule 61-501
("OSC Rule 61-501"). Pursuant to OSC Rule 61-501, the Board of Directors,
excluding Messrs Iacono, de la Campa and Arata, have approved the transaction
subject to the receipt of an independent valuation of Panwest's properties. In
addition, the transaction is subject to regulatory approval and requires the
approval of a majority of Medoro shareholders, excluding shares held by
interested parties.
Medoro Resources is a gold exploration and development company focused on
acquiring properties of merit for potential joint ventures with senior
producers.
THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE
For further information: Peter Volk, Secretary, (416) 603-4653,
pvolk(at)medororesources.com
(MRL.)
END
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