Canadian Dealing Network Millstream Mines Ltd.
Symbol - MLSM
Suite 2001
44 Victoria Street
Toronto, Ontario
Tel: (416) 368-9595
Fax: (416) 368-0584
27,501,376 shares issued
FOR IMMEDIATE RELEASE April 15, 1999
LIMITED PARTNERSHIP TO FUND POTTER PROPERTY PROGRAM
UP TO $19,000,000
Ernest Harrison, Chairman of Millstream Mines Ltd. (MLSM-Z) is pleased to
announce that Millstream has entered into an agreement in principle with
Hunter Dickinson Group Inc. ("HDG") pursuant to which limited partnerships
("LPs") associated with HDG have the right to fund up to $19,000,000 on
exploration of Millstream's Potter copper-zinc-cobalt massive sulphide
property. HDG is a private Canadian corporation affiliated with the Hunter
Dickinson team who are among Canada's most successful explorationists.
Under the agreement in principle, an LP, providing it expends a minimum of
$600,000 will earn under a farm-out, a 1% working interest for each
$133,000 expended on the Potter property in a $4,000,000 Phase 1 program
(maximum 30%). HDG has the right to involve LPs in two additional programs
with the earn-in cost escalating for a $10,000,000 second phase program to
a 1% working interest for each $400,000 expended (maximum 25%) and in a
$5,000,000 third phase program to a 1% working interest for each $1,000,000
expended (maximum 5%). It is not contemplated that the LPs will
cumulatively earn an aggregate of more than a 30% working interest at any
one time. In the event an LP ceases funding exploration work, Millstream
retains a call privilege in certain events to reacquire the working
interest earned by paying 130% of the exploration expenditures incurred by
the LP. The acquisition of the working interest would be completed by
issuing Millstream shares valued at market prices prevailing at the time of
exercise of the call. Millstream will also issue shares dependent on
certain performance events as well as based upon the reduction of the share
dilution which Millstream will enjoy under the LP financing structure when
compared with conventional equity financing. The exact number of shares
issuable in these circumstances cannot be currently determined but is not
expected to affect control. The agreement in principle also provides for
restrictions on Millstream's issuance of common shares for other corporate
purposes as long as the LP arrangements are outstanding. The agreement is
subject to completion of definitive agreements, regulatory approval and
financing of an LP.
Robert Dickinson of Hunter Dickinson said, "Millstream's drilling program
at its Potter property represents one of the most promising mineral
exploration projects in Canada. Recent drilling up to 660 metres (2000
feet) below the former Potter mine workings has returned excellent results
indicting a major copper-zinc-cobalt deposit is in the making.
Furthermore, geophysical targets located nearby on the property require
immediate testing."
Millstream has recently focused its activities on its 100% owned Potter
Mine property, which is situated in northeastern Ontario, near Highway 101
approximately 80 km east of Timmins. The Potter Mine was a former base
metal producer (1967-72) and occurs within an east-southeast trending
Archean succession of mafic to ultramafic volcanic and intrusive rocks
referred to as the Kidd-Munro Assemblage. This Assemblage hosts
world-class copper-zinc volcanogenic massive sulphide deposits (ie. Kidd
Creek, 138 million tonnes).
During 1996, Millstream carried out geophysics and mapping in the shaft
area of the property. This work identified favourable targets below and
beyond the historical Potter Mine workings. Old mining records indicated
that the ore zones were becoming thicker and higher grade with depth.
Therefore, in 1997 and 1998, the Company completed its first phase of
drilling below the historical mine workings. Eleven diamond drill holes
were completed. Five of these holes intersected significant widths of
copper-zinc-cobalt massive sulphides up to 330 metres (1000 feet) below the
historical mine workings proving that mineralization continues to depth.
(See Table 1)
Table 1
Summary of 1997 - 1998 Drill Results
Core Length Cu Zn Co Ag Vertical Depth
Drill Hole Intercept Interval Below Surface*
(#) Metres (m) (ft) (%) (%) (%) (oz/ton) (m) (ft)
S97-08A 489.00-494.40 5.40 17.70 1.72 4.93 0.073 0.73 425.8 1397.2
S98-05 507.40-519.70 12.30 40.36 1.53 2.05 0.131 0.42 444.7 1459.2
S97-09 604.60-627.50 22.90 75.13 2.65 2.70 0.083 0.76 533.5 1750.4
S98-06 653.90-680-66 26.76 87.80 2.57 1.68 0.082 0.61 578.1 1896.1
S98-01 695.15-702.60 7.75 25.40 5.34 3.24 0.067 1.16 605.4 1986.2
* Vertical depth from surface to mid-pierce point of intersection.
Recently, Millstream drilled Hole S99-01A to test the downward continuity
of the copper-zinc-cobalt massive sulphide horizon a further 330 metres
(1000 feet) below the 1997-98 drill intersections and 660 metres (2000)
feet below the historical mine workings. This hole intersected the
favourable horizon downhole from 1131 metres (3711 feet) to the bottom of
the hole at 1193 metres (3914 feet) for an intercept length of 62 metres
(203 feet). The favourable horizon contained four copper-zinc-cobalt
massive sulphide intervals. (See Table 2)
Table 2
Assay Results for Deep Drill Hole S99-01A
Intercept
Interval Core Length Cu Zn Co Ag Vertical Depth
Below Surface
Metres Metres Feet % % % oz/t m ft.
1171.9 - 1179.7 7.82 25.66 1.96 3.18 0.085 0.53 914 3000
1165.2 - 1166.2 1.00 328 1.26 1.18 0.036 0.29 903 2963
1161.0 - 1162.0 1.00 3.28 1.71 0.46 0.037 0.34 900 2953
1158.4 - 1159.9 1.55 5.09 2.11 1.40 0.093 0.50 899 2947
Millstream's drill results to date indicate a significant
copper-zinc-cobalt deposit is in the making. Planning has commenced to
comprehensively drill-off the Potter deposit and explore other high
priority deposit targets.
For more information visit the Company's website: www.millstreammines.com
The principle objective of Millstream Mines Ltd. is to enhance and develop
known mineral properties to production potential. Millstream holds mineral
claims or interests, directly or through wholly owned subsidiaries in
Canada, USA, and the Czech Republic.
-30-
For further information contact:
Mr. Ernest Harrison, EM Phone: 705-474-7282
Mr. Marty Martinello, B.A. Fax: 705-474-5491
Or
Mr. Peter Brodie Brown Phone: 416-368-9595
Mr. Robert Chase, B.A. Fax: 416-368-0584
Email: mlsm@passport.ca
Website: www.millstreammines.com |
