Ivernia Announces Prairie Downs Lead/Zinc Exploration Joint Venture as Next Step in Growth Strategy
Tuesday, Jun 15, 2010
Ivernia Inc. ("Ivernia") (TSX:IVW) has signed a binding heads of agreement in respect of the formation of a joint venture arrangement with Prairie Downs Pty Ltd ("Prairie Downs") to acquire up to 80% of the Prairie Downs lead-zinc project in Western Australia (the "Joint Venture").
The highlights are:
-- Part of Ivernia's growth strategy to create a portfolio of base metal
projects
-- Opportunity to explore and establish a significant lead - zinc project
-- Synergies with Ivernia's nearby (within 250 kilometres) flagship
Magellan lead mine in Western Australia
-- A$3 million exploration program focused on a range of defined
prospective targets Option to acquire a 60% interest for A$10 million
after completion of the exploration program with a right to increase to
80% following further exploration expenditure
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The Joint Venture, via wholly owned subsidiary Ivernia Australia Exploration Pty Ltd, represents an important first stage in Ivernia's strategy to develop and grow a portfolio of advanced base metal projects. This strategy builds on the success and strong cash flow potential of Ivernia's existing Magellan lead mine, approximately 250 kilometres to the south of Prairie Downs (see Figure 1).
Previous drilling at Prairie Downs has concentrated only on the known resource with limited work on other deposits in the belt or on associated mineralization.
Under the Joint Venture arrangement Ivernia has committed to an immediate and accelerated initial A$2 million exploration program of infill sampling and drilling. This program will take place within 12 months and will test a number of geological, geochemical and geophysical targets in the vicinity of the known deposits at Prairie Downs.
A recent mineral resource estimate, by independent consultants Optiro Pty Ltd, has re-interpreted Prairie Downs as a number of en-echelon lodes in the major structure and highlighted new extensional targets along strike and down plunge of the known lenses.
The current mineral resource estimate reports an Indicated resource of 2.3 million tonnes @ 5.2% zinc, 1.6% lead,15 grams per tonne silver and an Inferred resource of 0.7 million tonnes @ 4% zinc, 1.6% lead, 15 grams per tonne silver.
The initial drill targets include fault splays off the main deposit, such as the Gabbro lode, the Wolf prospect and a number of high priority geochemical targets along strike on the regional structure, such as Hyena (see Figure 2 and Figure 3).
The key features of Ivernia's Joint Venture arrangement with Prairie Downs include:
-- An option in favour of Ivernia to purchase a 60% interest in the Prairie
Downs Base Metal Project (the "Project") for A$10 million in cash or its
shares (at Ivernia's election) exercisable by Ivernia after expenditure
by it of A$3 million in 18 months (subject to the condition that a
minimum expenditure of A$2 million must be spent in the first 12 months)
or A$5 million within 36 months.
-- Upon the purchase by Ivernia of a 60% interest in the Project, the
formation of an unincorporated Joint Venture between it and Prairie
Downs with respect to the Project.
-- The ability for Ivernia to increase its 60% interest to 80% by spending
a further A$5 million on exploration within two years of earning the
initial 60% interest.
-- If either party fails to contribute its proportion of costs, its
interest in the joint venture will dilute proportionally until it is
2.5%, at which point the joint venture interest will convert to a free
carried interest.
-- If the diluting party's interest falls to 5%, the other joint venture
participant has a right to acquire that interest at fair market value.
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Ivernia owns 100% of the Magellan deposit near Wiluna and restarted lead production operations in February 2010. Exploration drilling is currently underway to test a number of new targets around the Magellan mine, improve the knowledge of the inferred resources, extend the known mineralization and extend the potential mine life of the region beyond the current eight years.
Maps and geological charts are provided on the following pages. A detailed summary of the Prairie Downs project is available on the Ivernia website at www.ivernia.com.
About Ivernia:
Ivernia is an international base metals mining, exploration and development company. The Company is the sole owner and operator of the Magellan lead mine in Western Australia. Magellan is the only significant pure lead mine in the world and at full production produces approximately 2% of the total world lead mine supply.
Ivernia trades under the symbol "IVW" on the Toronto Stock Exchange. Additional information on Ivernia is available on the Company's website at www.ivernia.com and at SEDAR at www.sedar.com.
To view Figure 1. Prairie Downs location near Newman in Western Australia, Figure 2. Recent geochemistry survey showing potential targets on regional geology and Figure 3. Prairie Downs ore body viewed from the north showing ore zones and drill holes, please visit the following link: http://media3.marketwire.com/docs/ivernia_maps_jun_13.pdf
Qualified Person
The information in this press release which relates to Mineral Resources is based upon information compiled by Ian Glacken who is a Fellow of the Australasian Institute of Mining and Metallurgy. Ian Glacken is an employee of Optiro Pty Ltd and has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and is a Qualified Person within the meaning of National Instrument 43-101. Ian Glacken consented to the inclusion in this press release of the matters discussed.
Source: Marketwire
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