Sep 21, 2010
Edgewater Completes Purchase Of Rio Narcea Gold Mines S.L. From Lundin Mining, Including The Corcoesto Gold Deposit, Spain Hosting 315,000 Ozs Measured And Indicated And 885,000 Ozs Inferred
Vancouver, British Columbia. Mr. George Salamis, President and CEO of Edgewater Exploration Ltd. ("Edgewater" or the "Company") is pleased to announce the Company has completed the purchase of all the outstanding shares of Rio Narcea Gold Mines S.L ("Rio Narcea") a wholly-owned indirect subsidiary of Lundin Mining Corporation ("Lundin", TSX:LUN, OMX:LUMI). Rio Narcea owns an undivided 100% interest in the Corcoesto gold deposit. The all cash purchase terms are: US$1.0 million paid on closing, US$4.0 million to be paid six months from closing, and US$3.0 million to be paid twelve months from closing, for a total of US$8.0 million. Lundin will retain a 1.5% Net Smelter Return ("NSR") Royalty upon the commencement of commercial production from the Corcoesto Gold Property subject to Edgewater having the right to re-purchase 1.0% of the royalty at any time after Closing for US$1,500,000.
Mr. George Salamis, President and CEO stated: "With the completion of the purchase of Rio Narcea Gold Mines S.L. from Lundin Mining Edgewater has acquired a 100% interest in an outstanding gold deposit in northwest Spain. The Corcoesto deposit hosts significant defined gold resources that are potentially amenable to open pit and underground mine development with resources open for expansion along strike and at depth. The acquisition of the Corcoesto deposit complements our existing joint venture with Red Back Mining Inc. on the Enchi gold project in Ghana. The Enchi project hosts numerous gold mineralized zones some of which have been extensively and successfully drilled by Red Back. Edgewater is planning to conduct major drill campaigns during 2010-2011 on both the Corcoesto and Enchi projects in order to define the ultimate gold potential of the Company's projects."
On September 2, 2010 the Company received an NI 43-101 technical report entitled; "Technical Report for the Corcoesto Gold Deposit" (the "Report") by Alan Noble, P.E. of Ore Reserves Engineering. The Report estimates a Measured and Indicated resource of 5,657,000 tonnes grading 1.73 g/t Au containing 315,000 ozs gold at a 0.65 g/t Au cutoff and an Inferred resource of 16,542,000 tonnes grading 1.66 g/t Au containing 885,000 ozs gold at a cutoff of 0.65 g/t Au for resources from surface to 200 m depth and a cutoff of 2.0 g/t Au for resources below 200 m. Cutoff grades were selected as reasonable cutoff grades for reporting resources likely to be mined by open pit methods for the upper portions of the deposit and by underground development for the lower portions of the deposit. The Inferred resource includes a higher grade resource below a depth of 200 m from surface of 1,857,000 tonnes grading 3.27 g/t Au at a 2.0g/t cutoff containing 196,000 ozs gold. Table 1 summarizes the Mineral Resources from the Report.
The technical content in this news release pertaining to the Corcoesto Gold Deposit was read and approved by Alan Noble, P.E., of Ore Reserves Engineering Inc., a professional mining engineer registered in the State of Colorado, USA and a Qualified Person ("QP") as defined by National Instrument 43-101.
The Company has now completed all of the final release conditions to its previously announced subscription receipt financing. The net proceeds from that financing have now been released from escrow to the Company. For further details regarding the financing please refer to the Company's press release dated August 31, 2010.
On behalf of the board of EDGEWATER EXPLORATION LTD.
President and CEO
For further information, please contact:
Ryan King, Vice President
Telephone: (604) 628-1012
THE TSX VENTURE EXCHANGE INC. HAS IN NO WAY PASSED UPON THE MERITS OF THE PROPOSED TRANSACTION AND HAS NEITHER APPROVED NOR DISAPPROVED THE CONTENTS OF THIS PRESS RELEASE.
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