Jeff: NEWS!!!!!!!
NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: RIOSUN RESOURCES CORPORATION
VSE SYMBOL: RSR
JUNE 30, 1997
Riosun Resources - Calgary Company Finalizes China Mining
Deal
CALGARY, ALBERTA--Riosun Resources Corporation announced Monday it
has entered into two separate memoranda of understanding with
Tongling Chingshan Iron-Sulfur of the Peoples Republic of China
(PRC) to develop and bring into production two mineral resource
properties containing gold, copper and sulfur in Anfei Province.
Riosun President P.C. Cochrane told the company's annual meeting
last Thursday that under the interim agreements Riosun will
contribute the company's mining expertise, undertake technology
transfer and provide access to capital resources, in return for a
share of the joint venture's production of gold, copper and
sulfur.
He said that in addition to promising gold mineralization the
sites also have extensive evidence of copper, which is in short
supply in China. Because of the shortage, the country has paid a
premium of up to 30 percent over the international price for
copper.
Riosun will immediately undertake technical studies and due
diligence on the properties, utilizing western mining techniques,
after which a feasibility study will be commissioned, Mr. Cochrane
said. In addition, personal meetings will be held by Mr. Cochrane
and international trade expert Ken Hughes of Calgary with local
authorities. Mr. Hughes is also a director of Riosun.
"The company's investments in these promising mining interests is
in keeping with the company's strategy to provide a stronger base
for shareholder returns by diversifying Riosun's interests, both
geographically and by mineral resource," Mr. Cochrane said.
One of the projects is an existing iron-sulfur mine, which the PRC
government believes would benefit from western mining practices.
The other is a polymetallic property containing copper, sulfur,
lead, zinc, gold and silver mineralization. Once the technical
reviews and due diligence are completed, Riosun will commission
feasibility studies on both projects, estimated to cost between US
$300,000 to US $500,000 each.
Riosun is required to produce a model mine and extraction
facilities for each project if warranted. Tonling will obtain the
required government permits to operate the projects. Each
memoranda is subject to completion of a formal agreement and
government approvals, by July 30, 1997. Each will be operated as
a foreign joint venture, through a joint venture company that is
to be formed.
The first of the interim agreements provides that before recovery
of capital expenditures, profits will be shared 51 percent to
Riosun and 49 percent to Tongling. After repayment of capital,
profits will be shared equally. The other interim agreement
provides that profit sharing will be agreed upon after completion
of the feasibility study and the determination of capital costs.
"We are honored to have been selected by the Peoples Republic of
China and the Tongling City government to participate in the
development of these important projects," Mr. Cochrane said. "We
look forward to a mutually rewarding relationship."
The agreement guarantees the sale to China of all of the sulfur
produced. The country is experiencing a shortage of sulfur, a key
component in the manufacture of most of the agricultural
fertilizers used there. Preliminary estimates are that up to 20
percent of the production from the mines is expected to be sulfur.
A finders fee will be payable to Global Nexus Pty Ltd., an
Australian resource consulting firm specializing in mining
projects in China, payable in cash and shares of Riosun, to the
maximum extent allowed under the policies of the Vancouver Stock
Exchange.
Riosun Resources Corporation is an international mining company
headquartered in Calgary. It specializes in the mining of gems,
minerals and precious metals, and has mining interests in
Madagascar and the Peoples Republic of China. Its shares are
listed on the Vancouver Stock Exchange and trade under the symbol
RSR. |
