Company Press Release
Cerro Dorado, Inc. Announces Agreement With Medinah Gold, Inc. to Acquire a 60% Interest in the Isle D'Ipun Gold Properties in Southern Chile
SALT LAKE CITY--(BUSINESS WIRE)--June 25, 1999--Under the terms of the agreement, Cerro Dorado, Inc. will issue to Medinah Gold, Inc., 500,000 shares of Cerro Dorado, Inc. in exchange for a 60% interest in the Ipun properties and 100,000 shares of Cerro Dorado, Inc. to Medinah Mining, Inc. for reimbursement of its costs and expenses incurred to date.
Medinah Gold, Inc. owns the properties by way of an agreement signed with Sr. Juan Jose Quijano in April 1998, and will retain a 40% carried interest.
Consulting Engineer, Ralph Bonham, recently visited the Ipun properties that are located 250 miles south of Puerto Mont, Chile. The Island is 6 miles wide, 12 miles long, has fresh water lakes, mild climate and can be worked year round. Ipun is the site of reported large areas of gold bearing placer sands covering major sections of the shoreline and dunes inland. Bedrock-hosted gold deposits are the source of these placers.
The first trip to the Island by Bonham was brief and was designed to test numerous reports of gold placers in the beach sands. Bonham has confirmed that gold is present in the sands and has recommended programs to confirm commercial viability. Gold was found in several streams that he tested and, he therefore concluded that bedrock sources probably exist nearby. The first test site was a stream on the southeast side of the Island that showed enough free gold to bring back ore samples for assay. The second test site, also a stream, showed free gold in the assays. The third site was the largest stream to be sampled and carried the best visual showing on the Island so far. The stream is about 10 feet wide and meanders to the ocean behind sand dunes. Bonham indicates the probability of old streambeds carrying gold.
''Ipun Island, with a little more testing and found to be commercial, could be put into production within a short period of time and be producing a profit with a minimal capital expense.''
Management of Cerro Dorado, Inc. has approved Mr. Bonham's recommendations for a return trip to Ipun and the undertaking of extensive testing to determine production feasibility.
Note: This News Release may contain certain ''forward-looking statements'' within the meaning of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of Cerro Dorado Inc. are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future could differ materially from those anticipate in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed under the heading ''Risk Factors'' and elsewhere in documents filed from time to time with the United States Securities and Exchange Commission and other regulatory authorities.
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