Oro Mining Announces Option and Joint Venture Agreement With DFX Exploration
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 11/30/11 -- Oro Mining Ltd. (TSX VENTURE: OGR) ('Oro' or the 'Company') announces that the Company and its subsidiaries Oro Gold de Mexico S.A. de C.V., Minera Oro Silver de Mexico S.A. de C.V. (collectively the 'Oro Parties') have entered into a definitive option and joint venture agreement (the 'Agreement') with DFX Exploration Ltd. ('DFX') and its subsidiary Grupo Promotor Minero, S.A. de C.V. (collectively the 'DFX Parties') whereby the DFX Parties have been granted an option to acquire 100% interest in certain assets located in Mexico.
Pursuant to the Agreement, the Oro Parties granted the DFX Parties: (i) the option to acquire a 100% interest in certain mineral concessions, concession applications and contractual agreements in Mexico and the transfer of a Panamanian back-in option agreement in consideration for $200,000; and (ii) the option to acquire an initial 80% interest in the Cimarron property by incurring $3,000,000 in exploration expenditures on or prior to November 30, 2014. In addition, DFX can acquire the remaining 20% interest in the Cimarron property by paying Oro $5,000,000 (in cash or DFX shares) within six months of the initial exercise for an 80% interest. Oro will retain a 1% NSR or the right to acquire certain underlying third party NSRs from any future production from the optioned properties.
John Brownlie, Oro's Chief Executive Officer commented, 'We are pleased with this transaction as it enables us to focus on our core asset, the Trinidad property, where we are advancing the Taunus gold deposit towards production. In addition, the transaction allows us to monetize the Cimarron property while maintaining an interest and reducing our corporate expenditure and property taxes.'
The Agreement is a non-arm's length transaction for purposes of the TSX Venture Exchange policies since DFX is a private company controlled by Darren Bahrey, President and a director of Oro and Frank Powell, Executive Vice President of Oro. However, as a condition of the Agreement, Messrs Bahrey and Powell have resigned from the Company effective immediately and Mr. Bahrey shall remain a director of Oro until the next annual general meeting of the Company. Both Mr. Powell and Mr. Bahrey will have consulting agreements with Oro in the event their services are required to assist on exploration-related activities. Among other things, Oro established a special committee of non-related directors to review the transaction and obtained a valuation in respect of the transaction. The transaction is subject to final acceptance by the TSX Venture Exchange. The transaction is exempt from the formal valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 under sections 5.5(a) and 5.7(1)(a) of such instrument.
Oro Mining continues to focus on development activities and is currently completing preliminary economic assessment and feasibility studies. Significant exploration potential remains on Oro's property portfolio of over 100,000 hectares.
About Oro Mining
Oro Mining is a publicly-listed company on the TSX Venture Exchange with properties located in Sinaloa and Zacatecas, Mexico. Oro Mining's priority is to advance properties toward production. The Trinidad property that hosts the Taunus gold deposit continues to be the priority focus of the Company's development activities.
ON BEHALF OF THE BOARD OF DIRECTORS
John Brownlie, Chief Executive Officer
Certain disclosure contained in this news release, including the payments and earn-in upon the successful completion of certain milestones, may constitute forward-looking information or forward-looking statements, within the meaning of Canadian securities laws. These statements may relate to this news release and other matters identified in the Company's public filings. In making the forward-looking statements the Company has applied certain factors and assumptions that are based on the Company's current beliefs as well as assumptions made by and information currently available to the Company. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Readers are cautioned not to place undue reliance on forward-looking statements. The Company does not intend, and expressly disclaims any intention or obligation to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Oro Mining Ltd.
John Brownlie
CEO & COO
(604) 646-1580
(604) 642-2411 (FAX)
jbrownlie@oromining.com
www.oromining.com
Investor Relations and Media:
Marston Webb International
Victor Webb
(212) 684-6601
marwebint@cs.com
