Hidefield
Gold plc ("Hidefield" or the
"Company", HIF:AIM) is pleased to announce
that following completion of due diligence work on the Golden Zone Project,
Alaska, the Company and its joint venture partner Mines Trust Inc. (the
"Vendors") have received notice from Fire River Gold Corp. ("FAU")
(CNSX:FAU) of its intention to enter into a formal option agreement (the
"Option Agreement") under which FAU will be entitled to acquire
up to a 100% interest in the Golden Zone Project. Hidefield
holds a 60% interest in the project and Mines Trust Inc. holds the
remaining 40% interest.
Under the terms of a memorandum of understanding (the
"MOU") with FAU, the Vendors granted FAU certain conditional
rights to acquire all of their respective interests in the Golden Zone
Project. FAU paid an initial US$20,000 on signing of the MOU and an
additional US$30,000 will be paid within seven days of signing of the
Option Agreement. Further cash payments of US$225,000 in total are to be
paid to the Vendors over a period of three years and are due on or before
May 31, 2012. All payments to the Vendors are to be shared pro rata to
their respective interests in the Golden Zone joint venture.
In addition to the cash payments referred to above, following the
signing of the Option Agreement, FAU will issue the Vendors with 500,000
FAU common shares. In addition FAU shares, with an aggregate value of
US$1,300,000, are to be issued to the Vendors over a four year period up to
May 31, 2013.
FAU must also undertake a total of US$2,500,000 in work expenditure
by 31 December 2014 with a minimum annual commitment of US$250,000.
Upon FAU having completed cumulative exploration expenditures of
US$1,000,000, made cumulative cash payments of US$200,000 and issued the
initial tranche of 500,000 FAU common shares and additional US$650,000 FAU
common shares, then FAU will be deemed to have earned a 51% interest in the
Golden Zone Project.
Following the payment of all cash payments, the completion of all
FAU shares issues and cumulative exploration expenditure to the value of
US$2,500,000, FAU's interest in the Golden Zone
Project will rise to a 100% interest which will be subject to a 2.5% Net
Smelter Royalty ("NSR"). Under the terms of the Option Agreement
FAU can acquire 1% of this royalty for US$1,000,000 leaving the Vendors
with an aggregate 1.5% NSR.
Hidefield intends
to use the proceeds from the foregoing option for general corporate
purposes. At this time, Hidefield has no plans
regarding the retention or disposal of any FAU shares which may be acquired
under the foregoing option.
Golden Zone Project
The Golden Zone Project is located 240 km north of Anchorage, Alaska on
the south flank of the Alaska Range. The
project is accessible by road, and is just 19 km from the Parks Highway,
which connects Fairbanks and Anchorage. A fully
self contained camp and work facility is on site.
The project contains a measured and indicated resource of
approximately 253,000
ounces of gold, 1,180,000 ounces
of silver and 6,114,000
pounds of copper. A technical report prepared by
Norwest Corporation in May, 2005 is available on the Hidefield
website. FAU has indicated it intends to confirm the stated resource in
preparation for an updated National Instrument 43-101 compliant technical
report later in 2009.
About Hidefield
Hidefield is a
gold company with a focus on the acquisition and development of highly
prospective projects in North and South America.
The Company has a diverse portfolio of projects, those of which in South
America are directly held as are the projects in Alaska,
while those in Canada, Nevada and Arizona
are held in independent, self-funded associate companies.
Hidefield's
substantial direct gold project interests are principally in Argentina where the Company is actively
exploring the advanced stage Don Nicolas gold project in Santa Cruz Province.
In Brazil the Company is
focused on the evaluation of the advanced stage Cata
Preta gold project near the historic city of Ouro Preto in the productive Quadrilatero Ferrifero region
of Minas Gerais state.
Enquiries:
Hidefield
Gold Plc
Ken Judge, Chairman: + 44 773 300 1002
Investor Relations
Jon Bey (North America):
+ 1 800 689 2599
Hanson Westhouse Limited
Tim Feather / Matthew Johnson: + 44 113 246 2610