/NOT FOR DISSEMINATION IN THE
UNITED STATES OR FOR DISTRIBUTION TO U.S. WIRE
SERVICES/
TORONTO,
Nov. 28, 2012 /CNW/ - Viking Gold
Exploration (TSX-V:VGC), the "Company" or "Viking Gold", is pleased
to announce that it has entered into a non-binding letter of intent
to acquire Trilogy Mining Corporation ("Trilogy"), a Canadian
mining exploration company active in Uruguay.
Trilogy, through its wholly owned subsidiaries,
owns the "Ecovent Projects", a property totaling over 30,000
hectares in the Florida Greenstone
Belt in southwestern Uruguay.
Trilogy also holds a 51% interest in an adjacent property with the
right to increase its ownership to 80% by investing $350,000 on the property prior to September 30, 2015. This property is identified
by Trilogy as the "Chamizo Project" and covers an area of
approximately 7,000 hectares. Two other permits, Rincon and El
Cuervo, are to be granted by the authorities and added to the
portfolio of the company.
The most advanced property of the Ecovent
Projects is "Carreta Quemada", a large gold mineralized system
inferred from stream sediment and soil geochemical surveys. Visible
gold particles are plentiful in the drainage system and the area
shows a good structural preparation potential for volume deposits.
This potential has been confirmed by a single trench over the best
soil anomaly that showed a stockworking style of mineralization
where leached surface rock samples returned as high as 1.3 g/t Au.
More than 700 soils samples were collected and analyzed and other
large soil anomalies are ready for testing.
The Chamizo property contains many targets, of
which two, Zones 13 and 14 exhibit potential ore grade gold
occurrences demonstrated by limited reverse circulation and diamond
drilling carried out by previous operators. In addition, a
new high-grade gold bearing vein set has been discovered at
Esperanza.
At Zone 13, gold mineralization has been
identified by RC drilling over a strike length of 300 metres with
the easternmost hole returning 2.78g/t Au over 8 metres starting at
surface in a sericite schist with pyrite. The Zone 14 was drilled
for high-grade quartz veins with the best intersection returning 9
meters at 4.5 g/t Au. None of this earlier drilling is NI 43-101
compliant. Esperanza is characterized by three
occurrences of a 3 to 4 metre wide quartz vein recognized over
1,200 metres along an East-West magnetic lineament. Chip samples of
the three occurrences have returned 25.9 g/t Au (Esperanza West), 8.7 g/t Au (Esperanza Center)
and 33.2g/t Au (Esperanza East).
Initial exploration will focus on expanding the
known gold bearing zones 13 and 14 and to explore Esperanza.
Geophysical surveys, MAG and IP, will be carried out over the
prospective areas and soil geochemical surveys will be extended to
cover all the drainage anomalies. At this time there are no defined
resources or proven reserves on these properties
As part of this acquisition, Viking Gold
acquires a team of seasoned professionals on the ground in
Uruguay led by Chris Clark, a successful Geologist that has had
many prospecting successes and put mines into production. The
Company is pleased to announce that Chris
Clark will be joining
its Advisory Board on closing
of this transaction. Mr. Clark will continue to run the
Uruguay operations on behalf of
Viking Gold after the closing. He spent 15 years with Rio Tinto
Group and then worked as a consulting geologist for numerous
companies until becoming the founder, President and CEO of Uruguay
Goldfields, (subsequently Uruguay Mineral Exploration and now
Orosur).
Viking Gold has agreed to a share-for-share
exchange with the shareholders of Trilogy and has agreed to issue
15,000,000 shares of Viking Gold in exchange for 100% of the shares
of Trilogy. The Viking Gold shares will be placed in escrow and
released in three tranches. The first tranche of 5,000,000 shares
to be released on closing, the second tranche of 5,000,000 shares
to be released two months after closing, and the final tranche of
5,000,000 shares within ten days of the Trilogy subsidiary
receiving a "prospecting permit" for the Ecovent Projects. In
addition, the Company has agreed to complete a private placement of
$500,000 within 120 days of closing
this transaction. The Company has also agreed to replace an
existing Cash Guarantee Environmental Bond amounting to
$50,000 within 12 months from
closing.
The Parties will execute a Definitive Agreement
after the completion of the necessary due diligence, as outlined in
the Agreement. The agreements and transactions contemplated
herein are subject to the approval of the TSX Venture Exchange, and
the Company's Board of Directors'. The transaction is scheduled to
close on January 31, 2013 assuming
all conditions in the agreement have been satisfied.
Joe Sandberg,
P.Geo., an independent "Qualified Person" as that term is defined
in NI 43-101, has reviewed and approved the technical disclosures
in this news release.
Neither the 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 press release.
This press release contains forward-looking
statements. All statements, other than of historical fact, that
address activities, events or developments that the Company
believes, expects or anticipates will or may occur in the future
(including, without limitation, statements regarding the estimation
of mineral resources, exploration results, potential
mineralization, potential mineral resources and mineral reserves)
are forward-looking statements. Forward-looking statements are
often identifiable by the use of words such as "anticipate",
"believe", "plan", may", "could", "would", "might" or "will",
"estimates", "expect", "intend", "budget", "scheduled", "forecasts"
and similar expressions or variations (including negative
variations) of such words and phrases. Forward-looking statements
are subject to a number of risks and uncertainties and other
factors that may cause the actual results, performance or
achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Factors that could cause actual
results or events to differ materially from current expectations
include, among other things, without limitation, failure to
establish estimated mineral resources, the possibility that future
exploration results will not be consistent with the Company's
expectations, the price of commodities and other risks identified
in the Company's documents filed with the Canadian securities
regulatory authorities on SEDAR.com. Any forward-looking statement
speaks only as of the date on which it is made and, except as may
be required by applicable securities laws, the Company disclaims
any intent or obligation to update any forward-looking
statement.
SOURCE Viking Gold Exploration Inc.