Mount Pearl, NL, Canada: Cornerstone Capital Resources Inc. ("Cornerstone") (TSXV-CGP) (F-GWN) (B-GWN) (OTC-CTNXF) today announced that it has signed a formal option agreement ("the option agreement") granting Great Western Minerals Group Ltd (TSXV-GWG) ("Great Western") the right to earn a 51% interest in Cornerstone's Chaleur rare earth element (REE) property in northern New Brunswick. The general terms of an earlier letter agreement ("the letter agreement") between Cornerstone and Great Western respecting a portion of the Chaleur property were previously announced on May 19, 2010 (see Cornerstone News Release).|
Under the option agreement the size of the subject property has increased from 200 mineral claims (the letter agreement) to 380 claims and, as a result, the underlying payment and work commitments have been revised. Great Western fulfilled its initial commitments under the letter agreement by issuing to Cornerstone 25,000 GWN shares and expending a minimum of $50,000 on exploration. Upon execution of the option agreement, Great Western made a cash payment to Cornerstone of $35,000 and will issue an additional 65,000 GWN shares following receipt of regulatory approval. Great Western may elect to make further payments of cash and shares totaling $75,000 and 340,000 respectively during the next three years and incur additional exploration expenditures totaling $1,350,000. The parties will then form a joint venture to further explore and develop mineral resources on the property. Great Western is operating the exploration programs during the option period in conjunction with their on-going Benjamin River REE project located adjacent to the Chaleur property.
"This option agreement validates Cornerstone's prospect generation business model," said Brooke Macdonald, President, Cornerstone Capital Resources Inc. "Our shareholders will benefit not only from the infusion of cash and shares from Great Western but also from their funding of a significant exploration program that is likely to greatly enhance the value of the Chaleur property."
The Chaleur property is underlain by the Siluro-Devonian Chaleurs Group, which comprises bimodal felsic and mafic volcanic rocks with minor intercalated sedimentary units. Locally these rocks are intruded by small bodies of Silurian or Devonian granites. In the district, a number of copper-iron skarn prospects are known in the metamorphic aureole of these intrusions. Great Western has been exploring its Benjamin River project immediately to the north where a number of heavy rare earth element enriched, apatite-diopside-magnetite dykes occur adjacent to one such intrusion.
2010 Exploration Program and Results
During 2010 Great Western completed exploration programs on two separate project areas on the Chaleur property: i) Claim Group 5323 (200 claims); and ii) Claim Group 5720 (180 claims). Exploration work included reconnaissance geological mapping, prospecting, mobile metal ion (MMI) soil geochemistry surveys and follow up bedrock chip sampling.
The MMI soil samples were collected at a grid spacing of 50 m x 100 m, and focused on areas where previous work by Cornerstone had identified anomalous REE concentrations in outcrop and stream sediment samples. A total of 819 MMI soil samples were collected over the east-central portion of Claim Group 5323, and 564 samples were collected over the southern portion of Claim Group 5720. With the exception of several isolated anomalies, the majority of MMI REE anomalies are concentrated along the banks and flood plains of streams and brooks. On Claim Group 5720, rock chip sampling of rhyolite outcrops exposed along the banks of two streams immediately above the MMI soil anomalies did not return significant REE values. Planned exploration work during 2011 will focus on identifying the source of the MMI soil anomalies utilizing more detailed geochemistry surveys, geological mapping and prospecting.
All MMI soil samples were prepared and analysed at SGS Minerals Services (SGS) in Toronto, ON utilizing the MMI-M package. Rock chip samples were prepared and analyzed for REE and whole rock by lithium metaborate fusion and ICP-OES at SRC (SRC) Geoanalytical Laboratories in Saskatoon, SK. Both SGS and SRC follow strict QA/QC protocols which includes the insertion of blanks, duplicates and standard reference materials into the sample stream.
This press release was prepared by Terry Brace, P.Geo., Cornerstone's VP Exploration and a Qualified Person (QP) in accordance with National Instrument (NI) 43-101. Exploration programs on the Chaleur property are being carried out under the supervision of John Pearson, P.Geo., Great Western's VP Exploration and a QP in accordance with NI 43-101.
Cornerstone Capital Resources Inc. is a mineral exploration company based in Mount Pearl, Newfoundland and Labrador, Canada, with a diversified portfolio of projects in Canada, Ecuador and Chile, and a strong technical team that has proven its ability to identify, acquire and advance properties of merit. The company's business model is based on generating exploration projects whose subsequent development is funded primarily through joint venture partnerships. The company is well funded and commitments from JV partners constitute significant validation of the strength of Cornerstone's projects.
About Great Western
Great Western Minerals Group Ltd is an integrated Rare Earths processor. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the Company's wholly owned subsidiaries Less Common Metals Limited in Birkenhead, U.K. and Great Western Technologies Inc. in Troy, Michigan, these alloys contain aluminium, nickel, cobalt and Rare Earth Elements. As part of the Company's vertical integration strategy, GWMG has signed an Off-take Agreement for 100% of the Rare Earth Elements produced at the former producing Steenkampskraal mine in South Africa and holds 70.2% ownership in Rare Earth Extraction Co. Ltd., the owner of the Steenkampskraal mine. GWMG also holds interests in seven Rare Earth exploration and development properties in North America.
Certain statements contained in this press release may be considered as forward-looking. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from estimated or implied results. While Cornerstone anticipates that subsequent events may cause its views to change, it expressly disclaims any obligation to update the Forward-Looking Statements contained herein.
Further information is available on Cornerstone's website: www.cornerstoneresources.com or for investor, corporate or media inquiries, please contact:
North America toll-free: 1 (877) 277-8377
Martti Kangas - Direct Line: 1 (647) 521-9261
Paul Benwell / Pat Kairns - Direct Line: 1 (514) 904-1333
Investors can access and join the following Cornerstone social media channels:
YouTube channel (http://www.youtube.com/user/CornerstoneResource)
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On Behalf of the Board,
H. Brooke Macdonald
Further information is available on the Cornerstone Web site at www.cornerstoneresources.com; via e-mail at firstname.lastname@example.org; or toll free at 1-877-277-8377.
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