Kootenay Options Prospective
Gold/Silver Concessions to First Mexican Gold and International
Millennium Mining
Kootenay Gold
Inc. (TSX.V: KTN) is pleased to announce that it
has entered into an Option Agreement with First Mexican Gold Corp
(TSX.V: FMG) and International Millennium Mining whereby they can
earn an undivided 60% interest in four properties, located in Sonora
State, Mexico.
The Option Agreement allows First Mexican and IMI to acquire a 60%
undivided interest by paying US$25,000 on signing, issuing an aggregate
1,200,000 common shares of FMG over 5 years and spending US$2 million on
the property over 5 years. Plus Kootenay retains a 1% NSR interest which
can be purchased for US$1 million. The earn-in period can be accelerated
at the discretion of FMG. At completion of the earn-in a JV Agreement
will be formalized.
States Kootenay President and CEO James McDonald, "We are
very pleased to have First Mexican and IMI as a partner. Their aggressive
consolidation of an 11,506 hectare land package contiguous with the Corex Gold Corp's Santana Property is an exciting
development. Our exploration team has been diligent in advancing this
prospect over recent months. The high grade gold results returned from
assays and the multiple 1Kg+ Silver Targets identified to date supports
that initiative and underlines the highly prospective nature of the
prospect.
Adds Kootenay Chairman Ken Berry, "The First Mexican Gold
joint venture provides our shareholders with multiple opportunities for
new drill discoveries. As we continue to prioritize the aggressive
ongoing development of our core asset the Promontorio
Silver Project in Sonora, Mexico, we have now successfully joint ventured
18 of our 100% owned precious metals properties in Canada and Mexico.
Collectively, these strategic partnerships afford Kootenay minimal
financial exposure and up to $20.7 million in exploration expenditures
over the next 5years."
The property package comprises 3,606 hectares and is considered very
prospective for gold and silver mineralization with numerous historic
workings present. The claims include La Cabana 1 Frac
I, La Cabana 1 Frac II, La Cabana 1 Frac III and Cuatas which
are 100% owned by Kootenay.
Sampling has been conducted by Kootenay Gold with over 120 samples
assayed with the highlights listed below. The samples from the Minas
Viejas area of the La Cabana Frac II property
is on trend and very close to the recently reported samples (see FMG news
release Feb 16, 2011) from Bailey zone of First Mexican.
Sample Highlights
- sample # FA1322G returned - 11.40 g/t
gold, 92 g/t silver
- sample # LM1041D returned - 1.54 g/t
gold, 672 g/t silver, .69% copper
- sample # CA1032D returned - 3.25 g/t
gold, 4620 g/t silver, .698% copper
- sample # CA984D returned - 12.20 g/t
gold, 877 g/t silver, 13.40% copper
- sample # LM1046G returned - 4.49 g/t
gold, 504 g/t silver, 2.70% copper
Table of Key Sample Results
LOCATION
|
SAMPLE NUMBER
|
AU (g/t)
|
AG (g/t)
|
CU (%)
|
SB ppm
|
PB ppm
|
CUATAS
|
|
|
|
|
|
|
Cruz de Mayo
|
FA1322G
|
11.4
|
94
|
.046
|
2080
|
|
|
LM1041D
|
1.54
|
672
|
.69
|
620
|
510
|
Urquidez
|
|
|
|
|
|
|
|
LM1118F
|
0.179
|
2
|
|
|
|
|
MK788
|
0.145
|
7
|
|
|
|
|
MK796
|
0.128
|
4
|
|
|
|
La CABANA FRAC II
|
|
|
|
|
|
|
Minas Viejas
|
CA1032D
|
3.25
|
4620
|
.698
|
11500
|
860
|
|
MK782
|
1.03
|
182
|
.08
|
370
|
2990
|
|
CA1034D
|
0.45
|
1595
|
.645
|
4830
|
70000
|
|
CA1028G
|
0.257
|
3050
|
.127
|
5410
|
116000
|
|
CA1029G
|
0.176
|
2540
|
.091
|
3400
|
115000
|
|
CA1038G
|
0.117
|
1560
|
.304
|
1040
|
15600
|
Prom
|
|
|
|
|
|
|
|
CA984D
|
12.2
|
877
|
13.40
|
15450
|
15650
|
|
FA1323D
|
0.46
|
53
|
.295
|
1200
|
14050
|
|
LM1045CH
|
5.42
|
119
|
.077
|
3710
|
3980
|
|
LM1046G
|
4.49
|
504
|
2.70
|
11750
|
33500
|
|
TR588
|
0.421
|
5
|
.070
|
120
|
2450
|
|
TR589D
|
.017
|
3
|
4.50
|
|
|
blanks = not significant;(Above samples are
highlights and range from background values to those above. Samples
ending with CH are channel samples, G are select prospector grab samples
of out crop, D are samples from old mine dumps and F are samples of proximal
Float.)
"The Kootenay Option Agreement allows First Mexican to acquire a
significant interest in ground considered highly prospective and on trend
with identified targets from our existing property package. Initial
reconnaissance has already begun and we intend to pursue exploration in
the immediate area of the Bailey zone, we look forward to working with
Kootenay going forward" said Jim Voisin,
President and Chief Executive Officer of First Mexican.
The foregoing geological disclosure has also been reviewed and verified
by Kootenay's CEO, James McDonald, P.Geo (a qualified person for the purpose of National
Instrument 43-101, Standards of Disclosure for Mineral Projects). Mr.
McDonald is a director of Kootenay.
About First Mexican Gold
First Mexican Gold Corp is an active explorer for precious metals in
Mexico and holds an option to acquire 80% interest in the Guadalupe
property package from a wholly owned subsidiary of International
Millennium Mining Corp. The Company now has an interest in 15,112
hectares in this high potential precious metals exploration area.
About Kootenay Gold
Kootenay Gold is actively developing mineral projects in the Sierra Madre
Region of Mexico and in British Columbia, Canada. The Company's flagship
property is the former producing Promontorio
Silver mine in Sonora State, Mexico. The Company's objective is to
develop near term discoveries and long term sustainable growth. Kootenay's management and technical team are proven
professionals with extensive international experience in all aspects of
mineral exploration, operations and venture capital markets. Multiple,
ongoing J/V partnerships in Mexico and Canada maximize potential for
additional, new discoveries while maintaining minimal share dilution.
-30-
For additional information, please contact:
James McDonald, CEO and President at 403-238-6986
Ken Berry, Chairman at 604-601-5652; 1-888-601-5650
To view an interview with James McDonald visit: www.kootenaygold.ca
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or the accuracy of this release.
Cautionary Note to US Investors: This news release may contain
information about adjacent properties on which we have no right to
explore or mine. We advise U.S. investors that the SEC's mining
guidelines strictly prohibit information of this type in documents filed
with the SEC. U.S. investors are cautioned that mineral deposits on
adjacent properties are not indicative of mineral deposits on our
properties. This news release may contain forward-looking statements
including but not limited to comments regarding the timing and content of
upcoming work programs, geological interpretations, receipt of property
titles, potential mineral recovery processes, etc. Forward-looking statements
address future events and conditions and therefore involve inherent risks
and uncertainties. Actual results may differ materially from those
currently anticipated in such statements. 2011 number 4
|