Mr. Gregory Beischer reports
MILLROCK ACQUIRES OPTION ON EL PICACHO GOLD PROJECT, IN AN ALLIANCE ARRANGEMENT WITH CENTERRA GOLD, SONORA STATE, MEXICO
Millrock Resources Inc. has entered an option agreement to purchase the El Picacho project. The project consists of district-scale concessions that cover approximately 6,300 hectares, located in Sonora state, Mexico, 18 kilometres southwest of the San Francisco gold mine which is operated by Alio Gold Inc. The target is an orogenic gold deposit of similar scope to that present at San Francisco. The project was identified to Centerra Gold Inc. by Millrock and Centerra has agreed that El Picacho will become a designated project under the terms of the strategic alliance agreement in place between the companies. The alliance was announced here in early 2017. Centerra has provisionally approved a $460,000 (U.S.) exploration budget for 2017 for the El Picacho project.
Gregory A. Beischer, president and chief executive officer, commented: "One of the senior members of Millrock's Mexico exploration team is highly familiar with the San Francisco gold mine. In comparison to San Francisco, he reports many similarities in the rocks and structures exposed on the El Picacho project. This is the first designated project to come out of our alliance with Centerra and we look forward to working on this project with them."
At El Picacho Jurassic rocks are juxtaposed in a thrust fault relationship with much older Precambrian age rocks. Structural relationships, alteration and mineralization discovered to date all indicate favourable conditions for the formation of an orogenic gold deposit similar in geologic style to the prolific gold mines of the La Herradura district to the northwest, or to the nearby San Francisco gold mine.
Millrock has an option to purchase a 100-per-cent interest in the mineral estate. To complete the purchase $1,723,500 (U.S.) in option payments are due over a four-year period. An initial payment of $21,375 (U.S.) has been made. Seven equal option payments of $21,375 (U.S.) will be due at six-month intervals. A final option payment of $1,552,000 (U.S.) would be made to complete the purchase of the mineral rights. Millrock, with Centerra concurrence, may withdraw from the option agreement at any time.
Centerra Gold has the option to earn an 80-per-cent interest in El Picacho by making exploration and other expenditures of $2.0-million (U.S.). Millrock's team will execute the exploration work and be entitled to a modest management fee. At vesting, a joint venture will be formed, Millrock may participate by contributing its pro rata share of costs, or it can elect to dilute to a 1.0-per-cent net smelter return royalty.
The underlying surface owner will be paid $10,000 (U.S.) annually for the first four years of exploration. Millrock may extend the option for two additional years for $20,000 (U.S.) per year and may purchase a surface tract at the price of $1,000 (U.S.) per hectare.
The technical information within this document has been reviewed and approved by Gregory A. Beischer, president, CEO and a director of Millrock Resources. Mr. Beischer is a qualified person as defined in National Instrument 43-101.
About Millrock Resources Inc.
Millrock Resources is a premier project generator to the mining industry. Millrock identifies, packages and operates large-scale projects for joint venture, thereby exposing its shareholders to the benefits of mineral discovery without the usual financial risk taken on by most exploration companies. The company is active in Alaska, British Columbia, the southwestern United States and Sonora state, Mexico. Financing for drilling at Millrock's exploration projects is primarily provided by its joint venture partners.
We seek Safe Harbor.
(C) 2017 Canjex Publishing Ltd. All rights reserved.