OCTOBER 30, 1997
Caribgold Seeks Stake in Pure Gold and Reclamation's
Sweetgrass Arch Property, Southern Alberta
VANCOUVER, BRITISH COLUMBIA--Donald R. Sheldon, President of Pure
Gold Resources Inc., is pleased to announce that the Company has
entered into an option agreement with CaribGold Resources Inc.
(TSE-CG) on the Lethbridge Property, an area totalling 1.4 million
hectares situated in southern Alberta.
The Lethbridge Property covers the north-northeast trending
Sweetgrass Arch one of the two oldest arches in Alberta, the other
being the Peace River Arch where Ashton Mining of Canada and Pure
Gold have discovered a number of important diamondiferous
kimberlites. Both arches intersect Archean Cratons, the Buffalo
Head and the Hearne Province cratons. Mr. Wilf Jones, Diamond
Consultant to Pure Gold, believes that the potential of locating
clusters of unexplored kimberlitic intrusions associated with
splay faults close to the Ohinge zoneO of the Sweetgrass Arch is
high. Past exploratory work south of the Lethbridge block has
uncovered seven intrusive bodies proximal to the Ohinge zoneO.
The best documented intrusion is the Black Butte pipe which
reportedly recovered one micro-diamond from a surface trench
sample.
The Company has recently begun a detailed high resolution magnetic
survey covering a wide area straddling the Ohinge zoneO of the
Sweetgrass Arch. It is anticipated that the survey will take
approximately 4 weeks to complete.
The Property is currently held 75 percent by the amalgamated Pure
Gold and Cayo Resources (see news release dated October 24, 1997)
and 25 percent Reclamation. As a first option, CaribGold can earn
a 25 percent undivided interest pro rata from Pure Gold and
Reclamation. To exercise its option, CaribGold will make a cash
payment of $125,000 on signing and another payment of $125,000
before the first anniversary of the Agreement and spend $1,000,000
on exploration expenditures within the first two years of the
option. A minimum of $500,000 will be spent in the first six
months.
By spending an additional $2,000,000 by the fourth anniversary of
the Agreement and issuing 100,000 shares CaribGold can earn an
additional 15 percent interest in the property.
The Property is subject to a 2 percent GOR and 2 percent NSR in
favor of the staker.
This agreement is subject to regulatory approval. |
