Jun. 23, 2010 (TheNewswire.ca) --
Vancouver, BC - Medallion Resources Ltd. (TSXV:MDL) , (TSX.V: MDL - "Medallion" or the "Company") announced today that it has added two additional mineral licences to the existing Red Wine heavy-rare-earth-element (REE) exploration property (the "Property"), in which Medallion can option a 100% interest (the "Option"). The two new licences are contiguous with the original northern block of the Property, which now covers an area of approximately 43 square kilometres. The Property is located about 100 kilometres northeast of Churchill Falls, Labrador. The largest licence is about 16 kilometres east of Provincial Route 389.
These new mineral licenses cover important key areas of the well-known northern Red Wine peralkaline intrusion, which is known to contain eudialyte, a mineral widely expected by experts to eventually supply a significant portion of the world's heavy-REE requirements. Heavy REEs are less common and more valuable than the light REEs.
"The addition of these two mineral licences builds on Medallion's excellent land position in the region," reports Medallion President Bill Bird. "The Red Wine intrusion is an exciting heavy-rare-earth prospect because the mineralogy appears to be similar to other important heavy-rare-earth properties such as Kipawa, Quebec and Dubbo, Australia. We believe that Medallion's Red Wine Property is some of the most prospective in the area and are looking forward to exploring it this summer."
The two new licences and the original four licences are subject to a revised Letter of Intent ("LOI") with Polaris Capital Ltd, a private corporation, and a principal shareholder (collectively, the "Vendors" of the Property). Following an initial payment of $2,160 to the Vendors for additional licence acquisition costs, the LOI provides for the evaluation of the Property with a 2010 summer exploration program, at an estimated cost of $125,000, before Medallion begins a series of Property payments to the Vendors. The 2010 exploration program will involve the REE industries' best consultants, including members of Medallion's Advisory Board, to complete an airborne radiometric survey, a geological map and a sampling program for assay, petrographic and mineralogical analyses. The data and conclusions will be presented in an NI43-101-compliant Technical Report.
As a condition of Medallion funding the summer 2010 exploration program, the Vendors have agreed that they, or their nominee, will participate in Medallion's current private placement with a subscription for Units worth $55,000.
In order to exercise the Option and acquire a 100% interest in the Property, subject to a 3% royalty to be retained by the Vendors, Medallion must complete the following, provided that Medallion is satisfied with its due diligence to be completed in the next 10 days:
-Complete a summer 2010 exploration program that is budgeted at $125,000 and completed by October 31, 2010. This program will include mapping and sampling, an airborne geophysical survey and an NI43-101-compliant Technical Report describing program results.
-Upon completion of the summer 2010 exploration program and the delivery of the resulting data, or by December 31, 2010, whichever is latest, Medallion may elect to proceed with the option to acquire a 100% interest in the Property. To maintain the option, Medallion must pay to the Vendors in instalments over a period of five years, beginning from the date that the TSX Venture Exchange provides final approval of the transaction, an aggregate of $525,000 cash and issue to the Vendors an aggregate of 1.9 million Medallion common shares. Medallion must also complete, during the five-year period, $400,000 in additional exploration work on the Property.
Medallion may purchase half of the Vendors' 3% Royalty at any time by making a cash payment of $1.5 million to the Vendors. The LOI remains subject to the approval of the TSX Venture Exchange.
Medallion Resources Ltd (TSX-V: MDL) explores for rare-earth elements, which are key components required by many new energy-saving technologies including wind turbines, electric and hybrid vehicles, supermagnets and virtually all modern electronics. Medallion is well positioned to take part in potential breakthroughs in the exploration for these rare metals.
In addition to the Red Wine HREE Project, Medallion has concluded an agreement with Rare Element Resources (TSXV:RES) to option a 65% interest in a joint venture to explore the Eden Lake REE property in Western Manitoba. The Eden Lake property is a recent discovery and one of North America's most promising REE prospects. Distribution studies indicate that the property has a potential for high neodymium and significant heavy REE by-products. The agreement with Rare Element Resources and the related filing of an NI43-101-compliant Technical Report on the Eden property remain subject to final regulatory approval.
For information: check Medallion's web site www.medallionresources.com or contact
William H Bird (888) 827-6611 williambird@medallionresources.com
Erica C Bearss (604) 681-9558 ebearss@medallionresources.com
Company Management takes full responsibility for content and preparation of this news release. Neither the TSX Venture Exchange, nor its Regulatory Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Some of the statements contained in this release are forward-looking statements, such as estimates and statements that describe the Company's future exploration and financing plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in these statements. Such risks include expectations that may be raised by discussing potential acquisitions. Also, in order to proceed with the Company's exploration plans, additional funding is necessary and, depending on market conditions, this funding may not be forthcoming on a schedule or on terms that facilitate the Company's plans.
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