Vancouver, British Columbia -- Artha Resources Corporation (TSX.V: AHC) is pleased to announce that the company has entered into an Option to acquire 5 exploration properties, 2 of which adjoin Silver Standard's Pirquitas Mine (see map). The Pirquitas mine was recently completed at a cost in excess of $US220 million, and is expected to produce 10.9 million ounces of silver, 2,500 tonnes of tin, and 6,500 tonnes zinc per year over its 14.5 year mine life, based on current reserves. With proven and probable reserves of 195 million ounces, Silver Standard reports that Pirquitas is the largest silver mine in Argentina and one of the largest primary silver mines in the world. Subject to approval, a NI 43-101 technical report details the 5 properties which cover an area of 25,862 hectares or 100 sq miles. The properties are highly prospective for silver, zinc, tin, gold, uranium and copper.
The option agreement, subject to TSX.V approval is with Davcha Resources International Ltd, (DRI) a BC registered private company. Upon execution of the formal agreement, DRI Managing Director Charles Straw will join the Board of Artha and become its Chief Executive Officer. Mr. Straw is an economic geologist with over 15 years in the mining industry. His experience is multi-faceted ranging from environmental management and planning through to mineral exploration, project development, valuation, finance and corporate management. He holds an honours degree in applied geology from UNSW in Sydney and is a member of the CIM and AUSIMM. He has lead the exploration and evaluation of precious and base metals projects in Australia, South America and China. He is currently an alternate Director and General Manager of ASX and London PLUS listed Silver Mines Limited.
The 5 DRI exploration properties are located in Argentina in the north-east of the mining Province of Jujuy within the Departments of Rinconada and Cochinoca, close to the Pirquitas Sn-Ag-Zn mining area and close to the south-east Bolivian border and north-east limits of Chile (see map). The geology of north-west Argentina is divided into three sub-parallel northerly-trending structural belts comprising from east to west, the Sub-Andean Range, the Eastern Cordillera and, the Altiplano (Puna). The exploration area is included in the latter structural belt which comprises Ordovician marine sediments, Tertiary continental sediments and, younger intrusives and volcanic rocks.
Mineral deposits in the region are dominated by base and precious metals as well as sulphur, borax and salts. Proterozoic rocks are dominant and include interbedded sandstones, shales and greywackes of the Ordovician Acoite Formation. These rocks are folded, typically with steeply-dipping axes that strike north to N30oW.
Mineralization at the Pirquitas Mine comprises a polymetallic deposit rich in tin, silver and zinc in the form of veins, stockwork veinlets and disseminations, hosted in the Ordovician Acoite formation. The mineralization is located on various groups of fractures of which the most important are orientated N 75o W and N 45o W.
Two of the properties surround the Pirquitas Mine on 3 sides (W, N and E), along strike and along potential lateral extensions of the mineralised structures that comprise the Pirquitas deposit. The old Pirquitas mine selectively worked the stronger veins within what has more recently been recognized as a stockwork system. Structures seen within the Pirquitas mine property pass into the DRI properties and are considered highly prospective. These two main properties are shown on the map as "Davcha JV" and "Davcha Option".
The Davcha JV property is owned by Cardero Resource Corporation whereby under notice of agreement dated 7th January 2007 DRI may earn a 55% interest by incurring exploration expenditures of US$1.0 million over 4 years. Upon DRI having earned its interest, the parties will enter into a Joint Venture (JV) and, thereafter each party is required to contribute its proportional share of further expenditures or be diluted on a straight-line basis.
The Davcha Option property is owned by Mr. G. Crosby and is under Option by Silver Star Resources Limited, an Australian registered company (SSR). SSR has assigned its 94% ownership in the Option to DRI for cash and retains a 2% NSR on the property. The total cost of the Option is approximately $US550,000 which includes payments to Crosby as per the Option agreement made over the last 2 years and to SSR for reimbursement of direct expenditure incurred on the property to date.
The three other properties (100% owned by DRI) are 32km to the east (Davcha 1), and 24km and 34km to the SW (Davcha 2 and 3 respectively). The Davcha 1 property was explored by the Mina Pan de Azucar Tin and Silver Mining Company some 40 years ago by trenching two separate oxide caps and, a quartz-baryte vein (Tupiza underground Mine) carrying some copper sulphides. All of these operations closed down some 30 years ago. Preliminary reconnaissance of the oxide caps indicates oxidized breccias and possible stockwork systems beneath.
The Davcha 2 and 3 properties are located on the east and west flanks of a 12km diameter volcanic ring complex with preliminary government reconnaissance sampling indicating anomalous tin-copper-gold.
DRI agrees to grant to Artha an option ("Option") to acquire the Property on the following principal terms.
Upon signing the LOI Artha will pay $25,000 to Davcha (completed).
To exercise the option Artha must issue and allot to Davcha 9,500,000 shares in its capital on the following schedule:
(a) 1,700,000 shares immediately following the acceptance for filing of a formal option agreement between the parties by the Exchange ("Acceptance Date");
(b)1,700,000 shares one year after the Acceptance Date;
(c) 1,700,000 shares two years after the Acceptance Date;
(d) 1,700,000 shares three years after the Acceptance Date;
(e) 1,700,000 shares four years after the Acceptance Date;
(f) 1,000,000 shares upon Artha receiving a bankable feasibility report ("BFR") on one of the Properties within eight years after the Acceptance Date; provided that if the BFR is not received within the said eight years the total consideration will be reduced to 8,500,000 shares of Artha.
Upon execution of the Formal Agreement, resolutions of the Directors of Artha will be passed to resign one existing Director and to appoint Charles Straw of Sydney, Australia, as a Director and as Artha's Chief Executive Officer.
It shall be a condition of the granting of the option and of the Formal Agreement becoming effective that DRI will through the efforts of its officers secure for Artha private placement share subscriptions for a minimum financing of $500,000.
States Todd McMurray, President & CEO "This is a very exciting opportunity for Artha and its shareholders as it provides an opportunity to expand not only into Argentina and in close proximity to a truly world class minerals deposit, but also to diversify its mineral portfolio into precious and base metals, a move the Board considers strategically important to Artha's continued growth.
Charles Straw, B.Sc., is the qualified person under NI 43-101 responsible for the technical information in this news release.
information in this news release.
Artha was founded by a team of mining industry professionals with a proven track record in project generation, exploration, mining and finance. The team's primary goal is to build Artha into a world class mining company, focused on the development and mining of economic minerals deposits world wide.
On Behalf of the Board of Directors,
President & CEO For Information Contact:
President and CEO, Director
Tel: 1 604 648 1530