CALGARY, ALBERTA--(Marketwire - May 17, 2012) - Geomark Exploration Ltd. (TSX VENTURE:GME) is pleased to announce that it has concluded a deal to acquire a 100% interest in the Kings Canyon gold property in the southwest corner of Utah. The transaction is a two part deal as follows:
a) Geomark assumes the existing Joint Venture (the "Crown JV") with Crown Resources Ltd. ("Crown") (an indirect subsidiary of Kinross Gold Corporation) on a claim block hosting a 200,000 oz. gold historical (non-NI43-101) mineral resource(ii). Under the Crown JV, Geomark has an all or nothing option to acquire a 100% interest in the lands (and the historical resource) by paying Crown US $1million prior to December 6, 2013. The property carries two Net Smelter Royalties ("NSR's") totaling 5%.
b) Geomark purchases a 100% interest in claims surrounding the Crown JV lands from Invenio Resources Corp. and Palladon Ventures Ltd. for CDN $325,000. NSR's on these claims range from 2 to 5%.
Geomark intends to begin drilling on the properties as soon as possible. The goal is to develop a critical mass of near surface, low grade gold mineralization of sufficient size to justify a low cost heap leaching operation. Several zones of gold mineralization, outside of the existing resource, have been identified on the claim block. The property has good exploration potential.
(ii) The reader is cautioned that the above referenced "Historical Mineral Resource" is considered historical in nature and is based on prior data and reports (Crown Resources 10-K Report December 2002) prepared by previous property owners prior to the existence of National Instrument 43-101. The historical resource is based on parameters of 6,800,000 tons at a grade of 0.03 oz/ton gold (1.02 g/t gold) for 204,000 ounces gold, using a cut-off of 0.013 oz/ton (0.44 g/t) gold. The work necessary to verify the reliability and classification of this mineral resources estimate has not been completed by Geomark and we confirm that the Historical Mineral Resource estimate therefore cannot be treated as NI43-101 compliant resources verified by a Qualified Person. Geomark is not treating the historical resource estimate as a current mineral resource or reserve. The historical estimate should not be relied upon and there can be no assurance that any of the historical resources, in whole or in part, will ever become economically viable. Geomark will determine what future steps will be required to upgrade the historical resource estimate to an NI43-101 compliant mineral resource.
Doug Dumka, P.Geo. is the Exploration Manager for Geomark Exploration Ltd. and is the designated Qualified Person (Q.P.) for the Kings Canyon Project.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 release.
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