True North Gems Options Yukon Rare Earth Discovery to Great Western Minerals
True North Gems Inc. and Great Western Minerals Group Ltd. are pleased to announce that TGX has granted GWMG an option to acquire up to a 65% working interest in TGX’s True Blue property in the Yukon in exchange for carrying TGX through to completion of a bankable feasibility study.
The True Blue property is located 55 kilometres south of Ross River, Yukon and is accessible via all-weather road to the Ketza River gold mine, followed by 10 kilometers of summer-only road to the property.
The property covers a batholith of Mississippian-age syenite, coeval felsic volcanic rocks and lower Paleozoic clastic and carbonate rocks of Silurian age. During a 2009 exploration program on the property, TGX discovered three new Rare Earth Element (REE) showings which returned assays of up 6.02% Total Rare Earth Oxides + Yttrium (TREO) and 2.52% Niobium Oxide (Nb2O5) with a high proportion of Neodymium and Heavy Rare Earth Elements (see True North Gems News Release Nov. 24, 2009).
Under the terms of the agreement GWMG can earn 51% interest in the property with an initial cash payment of C$50,000 on signing; followed by additional cash payments totaling C$350,000 on or before January 30, 2013. In addition GWGM will issue TGX 300,000 GWGM shares on signing, followed by an additional 900,000 shares on or before January 30, 2012.
In order to earn an initial 51% interest GWMG has the option to complete a total of C$5.0 million in exploration costs on or before December 31, 2013 with a commitment to incur C$1 million in exploration during 2010. Once GWMG earns its 51%, GWMG is also granted a Second Option that will allow GWMG to acquire a further 14% interest (total 65%) by completing all expenditures through completion of a Bankable Feasibility Study. GWMG will also have the right to market TNG’s share of REE production with a renewal option to TGX every three years.
The agreement is subject to regulatory approval and upon receipt of the necessary permits, GWMG will begin its preliminary exploration activities on this project, including an airborne magnetic and radiometric survey, geological mapping, prospecting, trenching and geochemical sampling and in order to define the extent of the known mineralization, identify new areas of mineralization and to define drill targets for the 2011 program.
Jim Engdahl, President and CEO of Great Western Minerals Group said, “This is another great opportunity for Great Western Minerals as well as for True North Gems. The preliminary data that we have reviewed is very encouraging with high Yttrium, Neodymium and Heavy Rare Earth Element content making this potentially high value mineralization. As well, the property is easily accessible with good road access. We have a goal of diversifying our mineral project portfolio geographically and balancing our rare earth mix. This JV satisfies our immediate focus on high value, Heavy REE dominant mineralization, in areas of good infrastructure in order acquire a secure supply of raw materials for our processing plants in Michigan and England.”
Nick Houghton, President of True North said “We are very pleased to have the Great Western Minerals Group, experts in the evaluation and marketing of rare earth minerals, assume the responsibilities of advancing the True Blue property. This will allow our company to focus on our core gemstone exploration business model.”