Post by Zoinkers on Aug 1, 2006 16:14:55 GMT -5
Press Release Source: Blue Note Metals Inc.
Blue Note Acquires Caribou & Restigouche Mines from Breakwater Resources
Tuesday August 1, 12:47 pm ET
Symbol & Exchange: BNT-TSXV
MONTREAL, Aug. 1 /CNW/ - Blue Note Metals, Inc. (BNT: TSX-V) reports that it has completed the acquisition of the Caribou & Restigouche mines (the "Acquisition") from Canzinco Ltd., a wholly owned subsidiary of Breakwater Resources Ltd. following the receipt of approval from the New Brunswick government.
The proceeds of the $75 million brokered private placement (the "Offering") which was co-led by Octagon Capital Corporation and TD Securities Inc. and included Blackmont Capital Inc. and Northern Securities Inc. (the "Agents") and which closed on May 11, 2006 will be used to re-open and develop the mine. Pursuant to their terms the subscription receipts sold under the Offering were automatically converted today into Common Shares of Blue Note and the $60 million held in escrow under the Offering has been released to Blue Note.
Part of the consideration paid by Blue Note for the acquisition of the mines is the issuance by Blue Note of a $15,000,000 principal amount unsecured subordinated convertible debenture in favour of Breakwater Resources Ltd. with a maturity date of five years following closing. The debenture is convertible into common shares of Blue Note at the option of Breakwater at any time after one year from the commencement of commercial production on the mines and prior to maturity, at a conversion price of $0.36 per common share.
Alternatively, Breakwater has the right to convert the debenture in exchange for a direct 20% ownership interest in the mines which must be exercised within one year from the commencement of commercial production of the mines. The debenture is repayable at maturity at the option of Blue Note by paying cash or the issuance of common shares at the conversion price of the average price of the shares for the previous 20 consecutive day trading period.
"We haven't waited for the closing to start our work," said John Martin, President of Blue Note. "We have already started de-watering the mines and commissioned engineering work. We've also been busy recruiting some of the best milling and mining talent in the business."
"I think this deal stands out in terms of its quality, size and timing," said Michael Judson, Chairman & CEO. "This is continued proof of our ability to identify great deals, finance them and close them."
The Caribou Mine site is located 50 kilometers west of Bathurst, New Brunswick and includes a fully developed underground mine to a depth of 300 meters, a 3000-tonne per day concentrator (mill) and a permitted tailings facility. The Restigouche open pit mine site is located 30 kilometers further west.
According to the re-opening plan, based on the following life-of-mine average prices; zinc US$0.65/lb, lead US$0.38 per pound and silver US$7.00 per troy ounce, mining consultants Micon International of Toronto estimate the project will yield an IRR of 28.7%.
The proven and probable mineral reserves at Caribou and Restigouche show the project will produce over 565 million pounds of zinc, 239 million pounds of lead and 5 million ounces of silver. The projected metallurgical recovery rates are 79.9% for zinc and 64.5% for lead produced.
Micon's report states that potential exists to extend the initial mine life by firming up and expanding on the inferred resource at Caribou which is estimated to be 3,944,000 tonnes grading 7.36% zinc, 3.59% lead, and 107 g/t silver. A preliminary assessment suggests that the project life could be extended to nine years if all the inferred resource can be converted to measured and indicated resources. However, it should be noted that inferred resources are too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and that there is no certainty that the outcome of any preliminary assessment will be realized.
John Martin, BASc, P.Eng, President of Blue Note Metals Inc. is a Qualified Person and has reviewed the technical information contained in this press release.
Blue Note Metals is a mineral exploration and mine development company with properties in New Brunswick. The company's shares trade on the TSX Venture Exchange under the symbol BNT.
Forward-Looking Statements
This news release contains discussion of items that may constitute forward-looking statements within the meaning of securities laws that involve risks and uncertainties. Although the company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Factors that could cause actual results to differ materially from expectations include the effects of general economic conditions, actions by government authorities, uncertainties associated with contract negotiations, additional financing requirements, market acceptance of the Company's products and competitive pressures. These factors and others are more fully discussed in Company filings with Canadian securities regulatory authorities.
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this news release.
For further information
LORNE WOODS, VICE PRESIDENT, INVESTOR RELATIONS, BLUE NOTE METALS, (800) 937-3095, lwoods@bluenotemetals.ca, www.bluenotemetals.ca
Blue Note Acquires Caribou & Restigouche Mines from Breakwater Resources
Tuesday August 1, 12:47 pm ET
Symbol & Exchange: BNT-TSXV
MONTREAL, Aug. 1 /CNW/ - Blue Note Metals, Inc. (BNT: TSX-V) reports that it has completed the acquisition of the Caribou & Restigouche mines (the "Acquisition") from Canzinco Ltd., a wholly owned subsidiary of Breakwater Resources Ltd. following the receipt of approval from the New Brunswick government.
The proceeds of the $75 million brokered private placement (the "Offering") which was co-led by Octagon Capital Corporation and TD Securities Inc. and included Blackmont Capital Inc. and Northern Securities Inc. (the "Agents") and which closed on May 11, 2006 will be used to re-open and develop the mine. Pursuant to their terms the subscription receipts sold under the Offering were automatically converted today into Common Shares of Blue Note and the $60 million held in escrow under the Offering has been released to Blue Note.
Part of the consideration paid by Blue Note for the acquisition of the mines is the issuance by Blue Note of a $15,000,000 principal amount unsecured subordinated convertible debenture in favour of Breakwater Resources Ltd. with a maturity date of five years following closing. The debenture is convertible into common shares of Blue Note at the option of Breakwater at any time after one year from the commencement of commercial production on the mines and prior to maturity, at a conversion price of $0.36 per common share.
Alternatively, Breakwater has the right to convert the debenture in exchange for a direct 20% ownership interest in the mines which must be exercised within one year from the commencement of commercial production of the mines. The debenture is repayable at maturity at the option of Blue Note by paying cash or the issuance of common shares at the conversion price of the average price of the shares for the previous 20 consecutive day trading period.
"We haven't waited for the closing to start our work," said John Martin, President of Blue Note. "We have already started de-watering the mines and commissioned engineering work. We've also been busy recruiting some of the best milling and mining talent in the business."
"I think this deal stands out in terms of its quality, size and timing," said Michael Judson, Chairman & CEO. "This is continued proof of our ability to identify great deals, finance them and close them."
The Caribou Mine site is located 50 kilometers west of Bathurst, New Brunswick and includes a fully developed underground mine to a depth of 300 meters, a 3000-tonne per day concentrator (mill) and a permitted tailings facility. The Restigouche open pit mine site is located 30 kilometers further west.
According to the re-opening plan, based on the following life-of-mine average prices; zinc US$0.65/lb, lead US$0.38 per pound and silver US$7.00 per troy ounce, mining consultants Micon International of Toronto estimate the project will yield an IRR of 28.7%.
The proven and probable mineral reserves at Caribou and Restigouche show the project will produce over 565 million pounds of zinc, 239 million pounds of lead and 5 million ounces of silver. The projected metallurgical recovery rates are 79.9% for zinc and 64.5% for lead produced.
Micon's report states that potential exists to extend the initial mine life by firming up and expanding on the inferred resource at Caribou which is estimated to be 3,944,000 tonnes grading 7.36% zinc, 3.59% lead, and 107 g/t silver. A preliminary assessment suggests that the project life could be extended to nine years if all the inferred resource can be converted to measured and indicated resources. However, it should be noted that inferred resources are too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and that there is no certainty that the outcome of any preliminary assessment will be realized.
John Martin, BASc, P.Eng, President of Blue Note Metals Inc. is a Qualified Person and has reviewed the technical information contained in this press release.
Blue Note Metals is a mineral exploration and mine development company with properties in New Brunswick. The company's shares trade on the TSX Venture Exchange under the symbol BNT.
Forward-Looking Statements
This news release contains discussion of items that may constitute forward-looking statements within the meaning of securities laws that involve risks and uncertainties. Although the company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Factors that could cause actual results to differ materially from expectations include the effects of general economic conditions, actions by government authorities, uncertainties associated with contract negotiations, additional financing requirements, market acceptance of the Company's products and competitive pressures. These factors and others are more fully discussed in Company filings with Canadian securities regulatory authorities.
The TSX Venture Exchange does not accept responsibility for the
adequacy or accuracy of this news release.
For further information
LORNE WOODS, VICE PRESIDENT, INVESTOR RELATIONS, BLUE NOTE METALS, (800) 937-3095, lwoods@bluenotemetals.ca, www.bluenotemetals.ca