Eurasian Minerals Inc. and Antofagasta
Minerals S.A. Sign Joint Venture and Regional Strategic Alliance
Agreements for Copper Exploration in Sweden and $5 Million Financing of
Eurasian
Vancouver,
British Columbia, February 18,
2011 (TSX Venture: EMX) -- Eurasian Minerals Inc. (the
"Company" or "EMX") is pleased to announce that it
has entered into a Strategic Alliance and Earn-In Agreement (the
"Agreement") with Antofagasta Minerals S.A. ("AMSA")
focused primarily on copper exploration in the country of Sweden. AMSA is
the mining division of Antofagasta Plc ("Antofagasta"), a
Chilean-based mining company listed on the London Stock Exchange. The
Agreement includes a regional strategic exploration alliance that covers
all of Sweden (subject to certain exclusions), an agreement to designate
the Kiruna South copper property as a
Designated Project with the right of AMSA to earn up to a 70% interest
therein, and a $5,005,000 CAD private placement into Eurasian.
The Strategic Alliance will seek to capitalize on EMX's ongoing
exploration efforts in Sweden, and advance several properties already in
the portfolio. To date, EMX has acquired 10 exploration licenses and has
an additional five applications on file with the Swedish Mines
Inspectorate, comprising 600 square kilometers of mineral rights. These
properties contain a variety of porphyry copper and
Iron-Oxide-Copper-Gold (IOCG) exploration targets, in addition to known
areas of copper, gold, and platinum group element (PGE)-enriched styles
of mineralization.
Regional Strategic Alliance and Designated Projects
AMSA and EMX, through the establishment of a technical committee, will
conduct a regional generative exploration program to identify additional
prospective properties for acquisition, with EMX serving as operator (the
"Alliance Phase"). AMSA will contribute funding of at least
$250,000 USD annually for a two year period. At the end of the period,
the Alliance may be extended by mutual agreement with AMSA funding a
minimum of $250,000 USD annually for as long as the agreement is in
place. The focus on copper does not prohibit the Alliance from exploring
for other minerals if the opportunity arises. In the event a property
reviewed during the Alliance Phase meets certain criteria it may be
classified as a Designated Project ("DP"), and will be subject
to the terms and earn-in conditions described below. Properties will be
acquired in the name of EMX, and if a property is declined as a
Designated Project, EMX is free to advance that property on its own terms
with no further obligation to AMSA.
All existing properties in the EMX portfolio in Sweden will be subject to
the terms of the Strategic Alliance agreement, and EMX will be reimbursed
acquisition costs for any projects that it nominates, and AMSA accepts,
as a Designated Project.
Kiruna South Designated Project
Upon execution, seven properties known collectively as the "Kiruna
South Properties" will become an initial Designated Project. These
include EMX's Pikkuj�rvi 1, 2, 3 and 4, Puoltsa 10, and the Kalixfors 1 exploration
permits, and an additional property that is under application for an
exploration permit. The Pikkuj�rvi and Puoltsa properties contain several
IOCG targets, including a zone of historic drill-defined copper and gold
mineralization on the Pikkuj�rvi 1 license. Coincident geophysical and
geochemical anomalies persist for approximately 4 kilometers along
strike; these areas have not yet been drill tested.
Porphyry-style alteration and copper-gold mineralization was intersected
at the nearby Sakkek prospect in a shallow 80 meter hole drilled by the
Swedish Geological AB (a state-owned exploration service company) in the
mid 1980's. The hole was drilled along the margin of a prominent 1.5
kilometer x 1 kilometer geophysical anomaly that coincides with a stock
of quartz-feldspar porphyry, and contains one meter intercepts of up to
2.07 percent copper and 0.31 grams per tonne gold. In addition, a number
of untested copper and molybdenum geochemical anomalies as well as
porphyry copper-gold-molybdenum occurrences are located elsewhere in the
"Kiruna South Properties".
Other EMX Properties in Sweden
EMX has applied for and has been granted several other exploration
permits in Sweden, in addition to two permits acquired as part of the
purchase of the Phelps Dodge Exploration Sweden AB ("PDES")
subsidiary from Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) (see
Company news release dated August 12, 2010). Properties acquired by EMX
to date include:
- The
Stor�sen copper-gold-PGE property in west central Sweden, which
contains a zone of drill-defined copper, gold and PGE mineralization
that extends for nearly one kilometer along strike along with
numerous surface geochemical anomalies, mineralized boulders and
mineral occurrences that have yet to be
tested.
- The
Norrmyran permit, part of the PDES acquisition, which includes
outcropping copper-gold mineralization and geology favorable for
further discoveries.
- Several
other permit areas are prospective for IOCG and porphyry copper-gold
type deposits.
Earn-in
terms for the Kiruna South DP and other
Designated Projects
AMSA may earn 51% interest in any DP (other than the Kiruna
South DP described below) by spending an aggregate of $5,000,000 USD over
five years (the "First Option Expenditures") and making a
one-time cash payment to EMX on or before the fifth anniversary equal to
the product obtained by multiplying 225,000 pounds of copper times the
average of the price of copper for the previous 30 trading days. In the
case of the Kiruna South Designated Project,
the above conditions also apply except that the earn-in commitment is
$10,000,000 USD over five years.
If AMSA completes the First Option Expenditures in a DP, the parties will
incorporate a company to hold each party's respective interests, i.e.
AMSA 51% and EMX 49%.
AMSA has the option to earn an additional 19% in the DP by sole funding
further exploration work and maintaining work commitments that escalate
to $2,000,000 USD per year by the fourth anniversary of the initial
earn-in (the "Second Option Expenditures"), delivering a NI
43-101 compliant feasibility study, and making another one-time cash
payment to EMX equal to the product obtained by multiplying 225,000
pounds of copper times the average of the price of copper for the
previous 30 trading days.
In the event AMSA completes the earn-in requirements to hold a 70%
interest in any DP, each party will fund its share of further
expenditures on a go forward basis. Standard dilution clauses will apply,
and if either party's interest is diluted below 10%, their interest will
automatically be converted to a 2% NSR. EMX will also retain the right to
convert its participating interest in a DP into a 2% net smelter return
at any time after AMSA earns its 70% interest in such DP and until
commercial production is reached. The conversion option also includes an
annual advance royalty payment equal to the product obtained by
multiplying 90,000 pounds of copper times the average of the price of
copper for the previous 30 trading days.
If AMSA fails to complete the Second Option Expenditures, each party's
interest will remain at AMSA 51% and EMX 49%, but EMX will take control
and management of the project.
Any other properties that emerge from the regional program will be
subject to the same earn-in and obligations as described above.
Private Placement
As part of the transaction, AMSA will purchase 1,540,000 units from EMX
at a price of $3.25 CAD per unit. Each unit will consist of one common
share and one-half of one common share purchase warrant. Each full
warrant will entitle AMSA to purchase one additional common share of EMX
for a period of two years at a purchase price of $4.00 CAD. The placement
is subject to TSX Venture Exchange approval.
Dr. Duncan Large, Chartered Engineer (UK) and Eur. Geol., a Qualified
Person as defined by National Instrument 43-101 and consultant to the
Company, has reviewed and verified the technical information contained in
this news release.
EMX is exploring and investing in a first class mineral property and
royalty portfolio in some of the most prospective, but under-explored
mineral belts of the world.
About Antofagasta
Antofagasta plc ("Antofagasta") is a Chilean-based copper
mining company listed on the London Stock Exchange and a constituent of
the FTSE-100 Index, with interests also in transport and water
distribution. Its mining activities are managed through its mining
division based in Santiago, Antofagasta Minerals S.A. ("AMSA").
Currently, Antofagasta's activities are primarily concentrated in Chile
where it owns and operates three copper mines: Los Pelambres, El Tesoro
and Michilla. Total production in 2010 included 521,100 tonnes of copper
in cathode and concentrate, 8,800 tonnes of molybdenum in concentrate and
35,100 ounces of gold. With a fourth mine, Esperanza, now being
commissioned, the Group is expected to increase total production in 2011
to approximately 715,000 tonnes of copper, 9,300 tonnes of molybdenum and
324,000 ounces of gold. Antofagasta also has exploration and evaluation
or feasibility programmes in North America, Latin America, Europe, Asia,
Africa and Australia.
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For
further information contact:
David M. Cole
President and Chief Executive Officer
Phone: (303) 979-6666
Email: dave@eurasianminerals.com
Website: www.eurasianminerals.com
Valerie Barlow
Corporate Secretary
Phone: (604) 688-6390
Email: valerie@eurasianminerals.com
Neither
TSX Venture Exchange nor the Investment Industry Regulatory Organization
of Canada accepts responsibility for the adequacy or accuracy of this
release.
Forward-Looking
Statement
Some of the statements
in this news release contain forward-looking information that involves
inherent risk and uncertainty affecting the business of Eurasian Minerals
Inc. Actual results may differ materially from those currently
anticipated in such statements.