Samaranta Signs LOI to Secure Exclusive Negotiating Rights to Gold and Platinum Targets in Choco Department, Colombia
VANCOUVER, British Columbia, Oct. 5, 2011 /PRNewswire/ — Samaranta Mining Corporation (TSX.V:SAX or “Samaranta”) has signed a letter of intent with the Colombian Board of the High Community Council of Novita – Cocoman (the “Council”) granting it a 90 day period of exclusivity to finalize terms and execute an agreement such that Samaranta and the Council will collectively make application to INGEOMINAS(Geo-Scientific, Mining, Environmental and Nuclear Research and Information Institute of Colombia) for the 117,647 hectare concession referred to as the Novita Application. As the Council represents the indigenous people of the Choco area it holds certain preferential rights in the assignment of any future mining concession. Terms incorporated in the initial LOI include the Council retaining up to a 20% carried interest in the Novita Application, Samaranta will participate in the concession application process by offering the necessary legal and financial support. Negotiations of the terms of the final agreement with the Council are progressing well.
Colombia is recognized as one of the most prospective, yet under-explored countries in the world in regards to gold, platinum, copper, manganese and coal, oil and gas, and provides an attractive mix of different types of geological deposits with an extremely high exploration and discovery potential within a highly pro-mining business atmosphere.
The Novita application is intended to cover a 117,647 hectare area in the Colombian department of Choco, which is located on the border between Colombia and Panama. Mining of gold in Choco has been traced back to the 1600s. The Novita application is located approximately 130 km south east of the city of Qubido, the capital of Choco. Choco ‘s main source of income comes from the gold mining industry. UGSG reported in 2009, Colombia’s gold production increased to 47,800 kilograms (kg), or by 39%, compared with that of 2008. Antioquia Department continued to be the leading producer followed by Choco Department, which together accounted for about 80% of the gold production for the year. Novita application covers a tributary of the San Juan River valley a source of significant platinum in alluvial deposits.
The Novita Application has limited bedrock exposure, but regional mapping indicates it is primarily underlain by variably metamorphosed siltstones, sandstones, cherts, limestones, tuffs and agglomerates with lesser basalts and volcanic breccias. Portions of the concession are covered by alluvial deposits and flood plains. Internal concessions to the Novita property boundary cover portions of this artisanal alluvial material where place mining of gold has been ongoing since the 1700s. Choco, Colombia, is a known platinum district and historically was the world’s only source of platinum until 1820. Prior to WW2 Colombia was a major producer of platinum, ranked first in the world between 1917 and 1923. According to the USGS, the current average reported alluvial production is over 1,000kg platinum per year.
The source of the gold and platinum in the alluvial material is the basis for the Novita Application and the primary exploration target for Samaranta. As contemplated in the LOI with the Council, if the concession is awarded to Samaranta and the Council, Samaranta has agreed to pass any unallocated alluvial mining rights within the proposed concession to the Samarium Group, a non-arm’s length company with an office in common with Samaranta,
The letter of intent has a 90 day period during which time a more definitive agreement shall be entered into, however this period may be extended by mutual consent or events out of control of the parties. The area of the concession may be reduced should the Council have an interest of religious, cultural, medical or social importance in any area, said area will not form part of this agreement.
Both parties are working actively on the final contract and hope to conclude it soon.
Management is encouraged by the progress to date in negotiating the definitive agreement with the Council, however at this time the definitive agreement with the Council has not been completed and the application for the property has not yet been made to the government authorities and therefore has not been awarded.
“We have built a strong relationship with the Board of the High Community Council of Novita – Cocoman and are confident we can complete the agreement and acquire Novita concessions we are seeking,” stated Dr. Volkmar Hable, President of Samaranta. “The opportunities presented by these vast tracts of unexplored highly prospective ground are exceptional. Gold and platinum have been recovered from alluvial deposits for centuries and it stands to be a very exciting endeavor to try and locate the bedrock source of these precious metals.”
Technical information in this news release has been reviewed by Derrick Strickland, P.Geo., a qualified person as defined in NI 43-101.
SAMARANTA MINING CORPORATION
Per: Volkmar Hable,
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact: Volkmar Hable, President Barry Girling Tel: 604 641 1210 604 639 4528 ------------------ ------------ firstname.lastname@example.org email@example.com ----------------- ----------------------------
Or visit our website at www.samaranta.ca
SOURCE Samaranta Mining Corporation