Apr. 14, 2010 (TheNewswire.ca) --
Vancouver, BC - Medallion Resources Ltd (TSXV:MDL) (TSX.V: MDL) announces that it has signed a Letter of Intent ("LOI") with a private vendor (the "Vendor") to acquire an option on a 100% interest in a Red Wine REE exploration project, which consists of four Labrador mineral licences totalling 3325 hectares (the "Property"). The Property covers parts of the Red Wine peralkaline intrusive complex in an area approximately 100 kilometres northeast of Churchill Falls, Labrador. The main licence is about 20 kilometres east of provincial road #389.
"The acquisition of the Red Wine Property is an important step for us, as it expands Medallion's property portfolio with a potentially significant heavy-REE project," stated Medallion President Bill Bird. "Peralkaline rocks, in particular, those that contain the mineral eudialyte, are prime targets for heavy REE's and the Red Wine rocks are well-known for REE occurrences and high concentrations of eudialyte."
Dr. Bird added: "Our agreement provides for a full field season of exploration work before Medallion begins a series of payments to the Vendor. The Vendor has also agreed to purchase a $50,000 private placement of Medallion's shares to assist in funding this initial exploration work. These terms are indicative of the mutual goodwill and shared purpose of Medallion and the Vendor. Our intent is to work together to provide up-to-date data to judge the Property's merit. During the coming field season, the REE industries' best consultants, including members of Medallion's Advisory Board, will be involved as we map and sample, fly an airborne radiometric survey and conduct petrographic and mineralogical analyses. The data and conclusions will be presented in an NI43-101-compliant Technical Report."
Provided that necessary regulatory approvals are obtained, including those of the TSX Venture Exchange, and that Medallion is satisfied with its due diligence, the parties have agreed to the following terms:
-Medallion will complete a summer 2010 exploration program, including mapping, sampling, an airborne geophysical survey and a NI43-101-compliant Technical Report on the Property by 31 October 2010.
-As a condition of Medallion funding the summer 2010 exploration program, the Vendor agrees that it, or its nominee will subscribe to a $50,000 private placement of the common shares of Medallion.
-Upon completion of the summer 2010 exploration program and the delivery of the resulting data, or by 31 December 2010, which ever 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 Vendor over a period of five years, beginning from the date the TSX Venture Exchange provides final approval of the transaction, an aggregate of $525,000 cash and issue to the Vendor an aggregate of 1.9 million Medallion common shares.
-Medallion must complete, during the five-year period, $400,000 in exploration work on the Property.
-Medallion may purchase half of the 3% royalty, which is in favour of the Vendor, at any time by making a cash payment of $1.5 million to the Vendor.
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, super magnets and virtually all modern electronics. Medallion is well positioned to take part in potential breakthroughs in the exploration for these rare metals.
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 ten most promising REE prospects. Distribution studies indicate that the property has a potential for high neodymium and a significant heavy REE by-products. An eight-square-kilometre area of multiple-mineralization styles supports targets for mineralization over a large surface area. 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 Further Information visit: www.medallionresources.com or contact
William H Bird (888) 827-6611 williambird@medallionresources.com or
Erica C Bearss (604) 681-9558 ebearss@medallionresources.com
Neither TSX Venture Exchange nor its Regulation 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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