NR: 12-03Virginia Energy Resources Inc. (TSX.V:
VAE) (OTCQX:
VAERF) is pleased to announce the execution of a definitive agreement to option its Hawk Ridge copper-nickel-PGM property in Ungava Bay, Quebec to Orient Venture Capital Inc. (TSX.V: OVC.H) for $3 million of cash and stock, as outlined in the Letter of Intent announced by VAE on February 7, 2012. Hawk Ridge is located 130 km north of Kuujjuak in the Labrador Trough and includes several deposits with significant past drilling.
The acquisition, when completed, will constitute the "Qualifying Transaction" of OVC pursuant to the policies of the TSX Venture Exchange. The resulting issuer will be re-named Nickel North Exploration Corp.
Under the terms of the agreement signed on March 29, 2012, OVC can earn a 100% interest in the Hawk Ridge property, subject to underlying royalty interests, by making staged payments totaling $2,000,000 in cash and $1,000,000 in OVC common shares to VAE. The agreement calls for an initial payment of $500,000 in cash and $250,000 in OVC common shares within 5 days of final Exchange approval of OVC's Qualifying Transaction. The second payment of $500,000 in cash and $250,000 of OVC common shares must be paid by December 31, 2012. The final payment of $1,000,000 in cash and $500,000 in OVC common shares must be paid by December 31, 2013.
In addition, OVC may be required to deliver up to $600,000 in OVC "concurrent financing units" (a unit being valued at $0.20 and consisting of one share plus one half of a warrant, with warrants exercisable at $0.40 in year 1 and $0.60 in year 2), in exchange for the expenses of an airborne geophysical survey to be completed by VAE in spring 2012. The final $1,000,000 cash payment would be reduced by an amount equal to 20% of the cost of the geophysical survey, and VAE will retain all Quebec tax rebates recoverable from the expenses of the survey.
The transaction is still subject to a number of remaining conditions, including, but not limited to, Exchange acceptance of the acquisition, acceptance by the Exchange of a National Instrument 43-101 technical report prepared by a qualified independent consultant, and a concurrent OVC financing of $5,014,000.
About Virginia Energy Resources Inc.Virginia Energy Resources Inc. is a uranium development and exploration company that holds a 29% stake in the advanced stage Coles Hill uranium project in Virginia. The Company is also pursuing active exploration programs in the Athabasca Basin of Saskatchewan and in the Otish Basin of Quebec.
On Behalf of the Board of Directors
VIRGINIA ENERGY RESOURCES INC.
Walter Coles Jr., President & CEO
For further information contact: Walter Coles, Jr., President/CEO
or Tony Perri - Investor Relations, Manager
Suite 611, 675 W. Hastings Street Vancouver, British Columbia, Canada V6B 1N2
Tel: (604) 669-4799 Website: www.virginiaenergyresources.com
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.