Cancana Provides Update on Brazil Manganese Corporation
TORONTO, ONTARIO--(Marketwired - Oct 10, 2014) - The Board of Directors of Cancana Resources Corp. (TSX VENTURE:CNY) ("Cancana") provides the following update on its 30% minority equity interest in Brazil Manganese Corporation ("BMC") (currently known as Rio Madeira Comércio Importação e Exportação de Minérios Ltda. and to be renamed Brazil Manganese Corporation), the joint venture established between Cancana and Ferrometals BV, Cancana's largest shareholder.
Geophysics Exploration Programs
As previously stated in Cancana's press release dated September 5, 2014, BMC is currently moving ahead with exploration programs which include aerial geophysics.
Geophysical crews are mobilizing to commence ground surveys this month. The surveys will include a variety of techniques, including induced polarization, ground magnetics, and gravity. The prospects that are being targeted for the first phase of work include areas where manganese vein zones up to 1-3m thick have been observed. The exposure of the veins along strike is intermittent due to the presence of a shallow cover of soil and colluvium. The geophysical programs will provide an improved understanding of the depth and strike extensions of thicker vein zones for subsequent drill targeting.
In addition to the ground geophysical program, BMC has awarded a tender for an aerial geophysical survey. The aerial survey will provide a detailed, project-scale dataset at 100m line spacings. Magnetic and electromagnetic data will be gathered, which is expected to fast-track the definition of exploration targets across the region. Permit applications have been lodged with the Brazilian Minister of Defence for the aerial program to confirm the final scheduling.
Exploration from both ground and aerial geophysics will assist in defining extensions to the boulder fields that supply current mining operations and target primary manganese vein structures at depth.
As previously stated in Cancana's press release dated July 21, 2014, BMC is implementing work practices and programs to align the work force with Canadian and international mining and safety standards. Currently both BMC production plants are operational, enabling the optimization of workflow practices. Output from both plants is being stored, sampled and sold.
Legal Proceedings
Cancana has been advised by BMC that due to certain BMC tenements being in close proximity to indigenous title land, BMC could be affected by a civil public action between two Brazilian government departments.
BMC currently owns several tenements, which border the Povo Cinta Larga indigenous land. Due to illegal diamond mining activities by third parties within the Povo Cinta Larga indigenous land and surrounding areas, the Brazilian Federal Prosecutor's Office (the "FPO") has filed a civil public action against the Brazilian Mining Authority - National Department of Mineral Production (the "DNPM"). The FPO is requesting the DNPM to withdraw all existent research applications and mining authorizations within the indigenous land of Povo Cinta Larga and surrounding area (10km) adjacent to the indigenous land (buffer zone). The DNPM has filed appeals to block the FPO civil public action and the final ruling is pending.
The eventual imposition of a buffer zone would have a material impact on BMC's tenements as some of BMC's tenements straddle or are wholly within the proposed 10km buffer zone.
The area impacted by the proposed 10km buffer zone would be approximately 38 km2 (rounded to the nearest km), which is approximately 35% of the total BMC project area.
BMC has retained TozziniFreire Advogados, a preeminent Brazilian law firm, to represent the joint venture. On behalf of BMC, TozziniFreire has filed a motion to join the proceedings at the appellate level, claiming a stakeholders and all tenements mandatory joinder to the lawsuit, which, if granted, could render null all previous procedural acts, including the relevant Appellate Court ruling.
In parallel, TozziniFreire has also prepared a depth of legal arguments to request a revision of the FPO injunction concerning research applications and mining authorizations in order to prevent the withdrawal of stakeholders licenses until the issue is finally resolved.
Cancana is supportive of BMC's actions, as it believes that legal action in this instance is in the best interests of its shareholders. Cancana will continue to vigorously defend the interests of its shareholders, and will continue to inform its shareholders on the ongoing BMC legal proceedings.
Cancana's MLB Tenements
The proposed 10km buffer zone would have an impact on certain of Cancana's MLB tenements. The MLB area impacted by the proposed 10km buffer zone would be approximately 17 km2 (rounded to the nearest km), which is approximately 4% of Cancana's MLB project area. Cancana will continue to monitor the BMC legal proceedings and assess whether a separate motion should be filed.
About Cancana Resources Corp.
Cancana is an exploration stage company that has transitioned into production through a joint venture with Ferrrometals BV. The joint venture (BMC) is focused on developing manganese production in Rondonia, Brazil. BMC has acquired an established manganese producer Rio Madeira and Eletroligas whose claims are adjacent to and mainly contiguous with Cancana's MLB manganese operation. All available resource reports and information on Cancana's properties are located on the Company website www.cancanacorp.com.
Issued on behalf of the Board of Directors of Cancana Resources Corp.
Senator J. Trevor Eyton, Chairman of the Board
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 press release. This press release contains forward-looking information under Canadian securities legislation. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Cancana to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks described in Cancana's public documents filed on SEDAR from time to time. Although management of Cancana has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Cancana does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.
