Weststar Resources Corp. : WESTSTAR OPTIONS AXE PROPERTY TO WORLD'S FOURTH LARGEST COPPER PRODUCER
(Thomson Reuters ONE) -
Suite 4006 - 1011 West Cordova Street
Vancouver, B.C. V6C 0B2
Telephone: (604) 678-5308
Fax: (604) 678-5309
Vancouver, BC - April 3, 2012: Weststar Resources Corp. (TSX-V: WER) (the
"Company") is pleased to announce that it has entered into an option agreement
with Xstrata Copper Canada (a division of Xstrata Canada Corporation)
(Xstrata-XTA: LSE) and Bearclaw Capital Corp. ("Bearclaw") dated March
21, 2012 (the "Option Agreement"). The Company and Bearclaw are parties to a
joint venture (the "Axe JV") in which they hold the beneficial interest in 25
mineral claims located in British Columbia, Canada, known as the Axe Property,
with the Company holding a 70% interest and Bearclaw holding a 30% interest (the
"Participating Interest").
The Axe Property is an advanced stage project with known porphyry copper
mineralization, which has been the subject of numerous drill programs since the
1960s. The Axe Property consists of 25 mineral claims (4,983 hectares), located
in the Similkameen Mining Division, 20 km north of Princeton, British Columbia.
The Axe Property was acquired in the 1960s by Adonis Mines Ltd., which commenced
exploration for porphyry copper style of mineralization. Major exploration
programs were completed by Adonis, Amax Exploration Inc. and Cominco Ltd. during
the 1970s and early 1980s. In total, 185 holes, comprising some 14,000 metres
were drilled during this period. Amax provided the initial historic resource
estimate in 1971, followed by estimates of Adonis in 1972 and 1973. The main
area of the Axe Property has been continuously held under title since 1967. A
fourteen-hole diamond drill program was completed by Weststar in 2006 and 2007
totalling 3,401 metres.
President, Mitchell Adam states, "We as a Company feel this is an excellent
opportunity to advance the Axe Property and could unlock the value of the Axe
Property for the benefit of our shareholders. To have a company of Xstrata's
calibre spend up to $18 million on the Axe Property is a major milestone for the
project. Additionally, we are of the opinion it is a great vote of confidence
in the British Columbia copper mining industry."
Under the terms of the Option Agreement, the Company and Bearclaw have agreed to
grant Xstrata an option to earn a 51% interest in the assets of, or held
pursuant to the Axe JV, including the Axe Property (the "Option").
Axe JV - Acquisition of 51% Interest
Pursuant to the Option Agreement, from the date of the execution (the
"Commencement Date") of the Option Agreement and continuing until the earlier
of: (i) four years from the Commencement Date; (ii) the exercise of the Option;
or (iii) the termination of the Option Agreement (the "Earn-In Period"), the
Company and Bearclaw have granted Xstrata the sole and exclusive right to carry
out exploration activities on and evaluate the Axe Property for minerals and to
grant Xstrata the Option.
In order to exercise the Option, during the Earn-In Period, Xstrata must incur
CDN$3,000,000 of expenditures in exploration activities on the Axe Property by
the end of the Earn-in Period.
In order to maintain the Option during the Earn-in Period, Xstrata must pay to
the Company and Bearclaw (collectively, in proportion to their Participating
Interest in the Axe JV):
(a) CDN$25,000 on the Commencement Date;
(b) CDN$25,000 on the first anniversary of the Commencement Date;
(c) CDN$30,000 on the second anniversary of the Commencement Date;
(d) CDN$40,000 on the third anniversary of the Commencement Date; and
(e) CDN$60,000 on the fourth anniversary of the Commencement Date.
If Xstrata exercises the Option, a joint venture will be formed between Xstrata,
the Company and Bearclaw with respect to Axe Property as evidenced by a formal
joint venture agreement with Xstrata as the initial operator holding a 51%
Participating Interest and the Company and Bearclaw a 34.3% and 14.7%
Participating Interest respectively.
Upon exercise of the Option, Xstrata will have the option to acquire an
additional 24% undivided interest in the Axe Property (increasing its interest
to 75%, absent other adjustments) by either completing a feasibility study on
the Axe Property or incurring no less than CDN$15,000,000 in feasibility study
expenditures on the Axe Property and providing the Company and Bearclaw with
evidence of such expenditures. In the event Xstrata exercises the second option
and acquires an undivided 75% interest in the Axe Property, then the Company
will have a 17.5% and Bearclaw a 7.5% Participating Interest in the Axe Property
respectively.
Under the Option Agreement the Company and Bearclaw have also granted Xstrata a
right of first refusal ("ROFR") over any direct or indirect sale or transfer by
the Company and/or Bearclaw of any of their respective interest in the Axe
Property, which ROFR will terminate at the end of the Earn-in Period if Xstrata
has not exercised the Option.
For further info on the Company please visit www.weststarresources.com or email
info(at)weststarresources.com Telephone: 604-678-5308.
On Behalf of the Board
Mitchell Adam, President
Weststar Resources Corp.
"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."
Website: www.weststarresources.com
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Weststar Resources Corp. via Thomson Reuters ONE
[HUG#1599585]
Unternehmensinformation / Kurzprofil:
Datum: 03.04.2012 - 08:00 Uhr
Sprache: Deutsch
News-ID 131347
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