January 21, 2009 - Vancouver, B.C.: Gold Star Resources Corp. (the "Company") (GXX � tsx.v) is pleased to announce the signing of an Agreement (the "Agreement") to acquire 90% of the issued and outstanding share capital of International Resource Strategies Liberia Energy, Inc. ("IRSLE"), a private company based in Monrovia, Liberia.
IRSLE is the holder of Hydrocarbon Reconnaissance License No. NR-001 issued by the National Oil Company of Liberia ("NOCAL"). The License grants exclusive rights to conduct exploration for oil, gas and any other hydrocarbon in an area of 1,366.37 square kilometers within the Roberts and Bassa Basins of south coastal Liberia.
The License is for an initial period of 12 months, and requires IRSLE to spend a minimum of (US) $1,750,000 on reconnaissance work on the property within the next 12 months, and may be renewed for an additional 12 month period. Upon successful reconnaissance work which identifies a hydrocarbon prospect, IRSLE shall have the first right of refusal to apply for a Petroleum Production Sharing Contract over the target area.
Prior to the signing of this agreement, the Company retained Dr. Martin Keeley, PhD, to accompany a representative from IRSLE to the project area. Dr. Keeley is an oil exploration professional with 28 years of international operational experience including work with Shell Oil, and is credited with commercial hydrocarbon finds in Egypt, Algeria and Columbia. He has also served as Visiting Professor in Petroleum Geology at University College of London, and was an editor of the Journal of Petroleum Geology.
While conducting due diligence on behalf of the Company, Dr. Keeley visited the License area and noted seepages indicative of potential hydrocarbon deposits.
Cost of the acquisition to the Company is as follows:
On signing of the Agreement, pay to IRSLE a total of (US) $125,000. On approval by the TSX Venture Exchange, issue to IRSLE 1,500,000 shares of the Company, and 1,500,000 non-transferable share purchase warrants, with each warrant entitling IRSLE to purchase one additional common share of the Company at a price of $0.20 per share for a two year period from the date of issuance.
Upon formalization of a subsequent joint venture or earn in agreement, on terms satisfactory to the Purchaser, issue to IRSLE an additional 1,500,000 common shares of the Company and an additional 1,500,000 non-transferable share purchase warrants, with each warrant entitling IRSLE to purchase one additional common share of the Company at a price of $0.20 per share for a two year period from the date of issuance.
As consideration for certain funds advanced towards the permitting process by third party investors (the "Guarantors"), and in conjunction with the Agreement, the Company will issue a total of 1,000,000 shares of the Company, and 1,000,000 non-transferable share purchase warrants, with each warrant entitling the guarantors the right to purchase one additional common share of the Company at a price of $0.20 per share for a two year period from the date of issuance. In addition, the Guarantors will be paid a total of (US) $50,000 as partial re-imbursement for funds advanced to IRSLE necessary for the permitting process.
A finders fee will be payable on this transaction as per TSX Venture Exchange policy.
The Agreement, and all share and warrant issuances are subject to the approval of the TSX Venture Exchange, and will be subject to hold periods as per TSX Venture Exchange policies.
Pat Morris, President of Gold Star commented, "We are pleased to put this transaction together, and look forward to commencing exploratory operations in Liberia. West Africa has shown increased promise to develop new hydrocarbon deposits in areas such as onshore Liberia, where previous exploration was never completed due to political concerns within the country. Thankfully, the Liberian political situation has become stable in recent years, with the local government encouraging international investment to further exploration for natural resources."
On Behalf of the Board,
"Patrick Morris"
Patrick Morris, President and CEO
For further information, contact Patrick Morris, President and CEO of the Company at:
pm@goldstarresources.com Telephone: (604) 641-4450 Facsimile: (604) 669-9335
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