October 22, 2010
Saskatoon, SK (October 22, 2010) — Foran Mining Corporation (TSXV: FOM) (“Foran”) is pleased to announce that it has entered into a definitive agreement to consolidate 100% ownership of the McIlvenna Bay deposit by purchasing the 25% interest held by Copper Reef Mining Corporation (“Copper Reef”) in the McIlvenna Bay Joint Venture Agreement, subject to closing and regulatory approval.
The acquisition provides for an exchange of assets, shares and cash between Foran and Copper Reef. The effect of the transaction is that Foran will receive:
- 25% of McIlvenna Bay joint venture which it does not already own giving Foran 100% of McIlvenna Bay deposit;
- 3.0 million Copper Reef shares giving Foran aggregate ownership of 9.0% of the issued and outstanding shares of Copper Reef on a non-diluted basis (Foran currently owns 3,799,500 shares of Copper Reef); and
- the North Hanson, Saskatchewan exploration project which is in close proximity to the current McIlvenna Bay joint venture property.
Copper Reef will receive:
- 4.0 million Foran Shares giving Copper Reef aggregate ownership of 8.0% of the issued and outstanding shares of Foran on a non-diluted basis;
- a cash payment of C$1.0 million;
- a Net Tonnage Royalty of C$0.75 per tonne of ore extracted from the McIlvenna Bay joint venture property subject to a right of first refusal in favour of Foran; and
- five Manitoba properties to be selected by Copper Reef from the Foran Manitoba property portfolio.
This value enhancing transaction is an important step in Foran’s previously stated goal of establishing itself as a significant polymetallic exploration and development company. The McIlvenna Bay deposit is one of the largest undeveloped VMS deposits in the world. As 100% owner of the McIlvenna Bay deposit, Foran will have complete flexibility in dealing with potential strategic partners, project financiers and off-take consumers.
Foran has identified the following immediate and key objectives as essential to become a significant polymetallic exploration and development company (see press release of October 6, 2010):
- Consolidate all existing historical data and begin exploration on some of the Company’s key assets.
- Recruit a Canadian based management team with a proven track record.
- Attract further Canadian based directors with proven track records.
- Strategically develop Foran to enable it to achieve its goal of increasing shareholder wealth.
Foran has appointed Equity Exploration as exploration managers to achieve the first objective (see press release of October 6, 2010). Acquisition of a 100% interest in the McIlvenna Bay deposit will result in the achievement of the fourth objective. The recruitment of a first class Canadian based management team and additional directors to develop the McIlvenna Bay deposit into a producer is underway.About Foran Mining Corporation
Foran Mining is a junior exploration company currently focused on the McIlvenna Bay deposit, which is comprised of 26 claims totalling 12,950ha, and is located approximately 1 kilometre south of Hanson Lake, Saskatchewan, approximately 375 km northeast of Saskatoon and 65 km west south-west of Flin Flon, Manitoba.
“ON BEHALF OF THE BOARD OF DIRECTORS”
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
FORWARD LOOKING STATEMENTS:
This news release contains forward-looking statements. These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management’s expectations. Forward-looking statements include estimates and statements that describe the Company’s future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results relating to, among other things, results of exploration, project development, reclamation and capital costs of the Company’s mineral properties, and the Company’s financial condition and prospects, could differ materially from those currently anticipated in such statements for many reasons such as: changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with the activities of the Company; and other matters discussed in this news release. This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company’s forward-looking statements. The Company does not undertake to update any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.
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