Sherwood Mining Corporation: Property Acquisition-Financing
Monday December 29, 12:42 pm ET
VANCOUVER, British Columbia--(BUSINESS WIRE)--Dec. 29, 2003--Sherwood Mining Corporation (TSX VENTURE:SWM - News) is pleased to announce that it has, subject to regulatory approval, entered into an option with Miramar Mining Corporation (TSX:MAE, AMEX:MNG) to acquire a 60% interest in the Chicago Area of the Hope Bay Belt, encompassing the Chicago/Kell trend, and the newly discovered Heku trend. (See Company Website for related maps).
The Chicago Area consists of 11 claims covering 9,162 hectares located in the southwest portion of the Hope Bay Belt, and lies approximately 15 km southwest of Miramar's Boston Camp. The Hope Bay belt in Nunavut, Canada, is being actively explored by Miramar and contains multiple gold deposits and showings.
Chicago Trend
Exploration to date by Miramar and previous operators within the Chicago trend has identified three gold and base metal showings (Kell, Kell South & Linear) within an eight km long trend of anomalous gold-silver-copper-zinc values. Mineralization comprises chalcopyrite, pyrite and sphalerite hosted within altered felsic volcanics. The Kell and Kell South showings, separated by 775m of overburden covered terrain, are believed to represent the near surface expression of a larger volcanogenic massive sulphide or epithermal system.
Channel Sample Highlights, Kell Showing
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Sample Number Sample Type Width (m) Gold (g/t) Silver (g/t)
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18165 Channel 0.50 45.0 6,393
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19606 Channel 0.55 169.1 3,232
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19602 - 19603 Channel 0.75 13.7 1,066
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18178 Channel 0.30 45.3 2,569
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17376 - 17377 Channel 0.40 15.5 1,266
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18152 Channel 0.50 12.0 2,701
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17349 - 17351 Channel 1.60 6.10 1,166
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17344 - 17347 Channel 2.40 8.26 2,559
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17361 - 17364 Channel 2.15 4.41 334
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17367 - 17370 Channel 2.15 9.32 779
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19626 Channel 0.50 15.81 4,438
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Heku Trend
Reconnaissance mapping and prospecting by Miramar in the south-western portion of the Hope Bay belt during 2003 returned significant gold assays from a horizon containing semi-massive chalcopyrite within felsic volcanic rocks (highlights below). This is a newly discovered mineralized corridor that runs parallel to the multi-element, silver-copper-gold Chicago trend that hosts the high grade 'Kell' showing. The Heku multi-element anomaly has been traced over an area 150m by 600m within frost heave and poor outcrop exposure. Additional work is recommended to advance this new discovery.
Surface Sampling Highlights - Heku Trend
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Sample-ID Sample Type Gold (g/t) Silver (g/t) Copper (%)
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62609 Grab 9.9 41.1 6.0
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62610 Grab 3.1 40.4 2.4
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62622 Grab 2.1 29.7 2.1
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62626 Grab 0.6 20.1 0.5
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62627 Grab 0.7 43.2 5.4
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Work Program
Sherwood is currently planning a program of work for 2004 that could entail a combination of reverse circulation and core drilling, combined with geophysics and surface exploration.
Agreement Terms
Under the terms of the agreement Sherwood has been granted an option to earn up to a 60% interest in the Chicago Trend by spending $3.1 million on exploration work in phases over a period of three years. Miramar will have a one time back-in right whereby Miramar may back-in to a 50% interest in the Chicago Trend by paying $500,000 to Sherwood. Miramar may elect to exercise its back-in right within 120 days of receiving notice that Sherwood has completed their earn-in.
In consideration for entering into the Chicago option, Sherwood has granted to Miramar a 30 day right of first refusal to acquire all or any portion of the Elu Property should Sherwood propose to sell all or any portion of the Elu Property. Sherwood grants to Miramar the right to acquire a 50% interest in the Elu Property and be the operator of all work thereon, exercisable within 90 days of completion of a feasibility study on the Elu Property by Sherwood. To acquire the 50% interest Miramar must pay Sherwood an amount equal to 100% of the amount that Sherwood has spend on exploration and development of the Elu Property to the date of election.
Sherwood has also granted to Miramar the right to participate in all future equity offerings by Sherwood in proportion to Miramar's then ownership of Sherwood.
Financing
Subject to regulatory approval, a non-brokered private placement of 1,250,000 units for proceeds of $350,000 has also been arranged. Each unit shall consist of one common share and one half of a share purchase warrant, with a whole share purchase warrant allowing the holder to purchase one common share at the price of $0.40 for a period of two years. The private placement consists of both flow through and non flow through shares, at the election of the subscriber.
Miramar owns 10 million shares of Sherwood, representing approximately 40% of the issued shares of Sherwood.
ON BEHALF OF THE BOARD OF DIRECTORS
D. Bruce McLeod, President
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release.
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