Lara Exploration Ltd.: Progress Report on the Curionopolis Iron Project in Brazil
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 10/27/11 -- Lara Exploration Ltd., ('Lara' or the 'Company') (TSX VENTURE: LRA) is pleased to report that partner Vertical Mineracao Ltda. ('Vertical'), has completed a US$10 million financing through the forward sale of one million tons of fine-grained iron ore from the Curionopolis Iron Project in Para State, northern Brazil. Proceeds of the financing are being used to complete purchase payments to Lara and surface rights owners, site preparation, to purchase milling equipment and to complete a further 7,000 metres of diamond drilling for reserve definition and mine planning.
Delays in closing the financing, originally negotiated in April, have caused delays to the drilling and certain project work, which was scheduled for completion in 2011. The funding now in place is sufficient to complete the proposed drilling, resource modeling, mine planning, environmental studies and reporting, with the plan now to file applications for a mining license in Q3-2012. Vertical has acquired surface rights, ordered milling equipment and initiated the site preparation and infrastructure necessary for a pilot mining operation, with a decision to proceed in Q1-2012 subject to completion of permitting.
Under the terms of the agreement with Vertical, an area of 1,348 hectares of the Curionopolis Property was ceded in exchange for payments to Lara of US$807,500 (US$100,000 paid at closing, US$100,000 in August, 2011) in cash and royalties of US$1.50/ton on sales of granular iron ore and US$0.75/ton on sales of fine-grained iron ore from the Project. Lara and Vertical have agreed that the remaining payment of US$607,500 plus a late fee of US$100,000 will be paid in twelve monthly instalments of US$55,688 the first of which was received October 4, 2011. Vertical may elect to complete full payment before October 30, 2011 in which case the late fee will not apply.
Quality Control
Michael Bennell, Lara's Vice President Exploration and a member of the Australasian Institute of Mining and Metallurgy (AusIMM), is a Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects and is responsible for the preparation and verification of the technical information in this release.
About Lara
Lara is an exploration company following the Prospect Generator business model, which aims to minimize shareholder dilution and financial risk by generating prospects and then exploring them in joint ventures funded by partners. The Company currently holds a diverse portfolio of prospects and deposits in Brazil, Peru, Colombia and China and has signed agreements for thirteen joint ventures, seven of which are expected to see partner-funded drilling in 2011. Lara's common shares trade on the TSX Venture Exchange under the symbol 'LRA'.
For further information on Lara Exploration Ltd. please consult our website www.laraexploration.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Lara Exploration Ltd.
Chris MacIntyre
VP Corporate Development
1 416 703 0010
www.laraexploration.com