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To: Goose94 who wrote (2502)	1/17/2014 7:55:20 AM
From: Goose94	Read Replies (2) \| Respond to of 203382

Cangold (CLD-V) Jan 16, '14 has signed a letter of intent, whereby Cangold will be granted an option to acquire, from Vista Gold Corp., up to a 100-per-cent interest (subject to certain underlying royalties) in the mining rights to the Guadalupe de los Reyes project in Sinaloa, Mexico. The Guadalupe de los Reyes project comprises 6,302 hectares, covering a past-producing district dating back to 1772. A preliminary economic assessment carried out on the project by Tetra Tech for Vista on March 4, 2013, estimated an indicated resource of 6.8 million tonnes at a grade of 1.73 grams per tonne gold and 28.71 grams per tonne silver (380,100 ounces gold and 6,315,300 ounces silver), as well as an inferred resource of 3.2 million tonnes at a grade of 1.49 grams per tonne gold and 34.87 grams per tonne silver (155,200 ounces gold and 3,639,000 ounces silver) at a cut-off grade of 0.5 gram per tonne gold. "We are very pleased to enter into this letter of intent with Vista for the advanced-stage Guadalupe de los Reyes project," stated Robert Archer, president and chief executive officer of Cangold. "With a significant compliant resource and a PEA already in place, and excellent exploration upside, we look forward to advancing the project further. It is our stated goal to turn Cangold into a junior gold producer, and our management team has the expertise to carry this out." Cangold is considering the resource in the preliminary economic assessment to be a historical estimate as Cangold's qualified person has not done sufficient work to classify the estimate as a current mineral resource for Cangold, as per National Instrument 43-101 requirements. Assuming Cangold signs the option agreement for the Guadalupe de los Reyes project, the company will update the resource within the time frame required. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The preliminary economic assessment includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized. The 2013 preliminary economic assessment envisaged an open-pit operation, while Cangold is considering a combined-open-pit-and-underground approach with a higher grade. Following the signing of a formal option agreement, the company plans to undertake a complete review of all previous work, update the resource, conduct additional baseline studies and diamond drilling, and advance the project to the prefeasibility stage. Terms of the option call for Cangold to pay to Vista a total of $5-million (U.S.) in staged payments over three years (a total of $1-million (U.S.) in the first year) in order to acquire a 70-per-cent interest in the project. Cangold may then purchase the additional 30 per cent by making a positive production decision and paying to Vista $3-million (U.S.) plus an escalator payment based upon the price of gold and the number of NI 43-101 measured and indicated gold-equivalent ounces over and above those in the March, 2013, preliminary economic assessment at the time of the decision. Should Cangold elect not to place the project into production, Vista will have the option to buy back the original 70 per cent for $5-million (U.S.) plus a similar escalator payment. In keeping with the proposed option and anticipated level of activity, the company is pleased to announce the appointment of Erick Bertsch to the position of manager, investor relations. Mr. Bertsch has 20 years of experience in the mining industry, and has held investor relations and corporate communications roles for Stratton Resources, Great Panther Silver and the Hunter Dickinson Group of companies. Robert Brown, PEng, director and vice-president, exploration, for Cangold, is the qualified person for the company. He has reviewed the technical information referenced above and has approved this news release.